Friday, March 6, 2015

High-Frequency Trading Explained

Hashtag of the Week: #HFTPickupLines

(Mar. 4) On Twitter this week, high-frequency traders -- including Haim Bodek, the speed trader and whistleblower who inspired Scott Patterson's book "Dark Pools" -- amused themselves with double-entendre pick-up lines, putting a whole new spin on terms such as "hide not slide," "go flat," and "co-location."

Premature speculation by TBTF asset managers?

FSOC unconcerned with "day-to-day regulation"

(Mar. 5) Deputy Assistant Treasury Secretary Patrick Pinschmidt said the Financial Stability Oversight Council's work is "still in the risk-identification stage" and that it would be "premature to speculate on any particular course of action the Council may take." The FSOC executive director urged patience while the council considers possible steps to manage risk in the asset management industry.

SEC's proposed rules to impact asset managers

New rules to enhance supervision, disclosure & risk management

(Mar. 5) SEC staff is developing several proposed rules to enhance data reporting requirements, portfolio composition disclosures, and a rule that would require investment advisers to create plans to deal with investment advisers experiencing severe duress. Derivatives may be singled out for particular reporting and disclosure purposes because of the risks associated with the products.

CFTC works on changes to swap-trading facilities

Also on agenda: benchmarks, cybersecurity, clearinghouses

(Mar. 2) Speaking at the Institute for International Bankers Conference in Washington, Commodities Futures Trading Commission Chairman Timothy Massad said his agency has "been looking at the rules on trading of swaps on swap execution facilities and I expect we will make some adjustments to those over the coming months," adding that the CFTC is encouraging more participation on the facilities.

GASB issues new marked-to-market rules

Guidance responds to stakeholder request for clarity

(Mar. 2) The Governmental Accounting Standards Board issued new rules that require investments a government holds in an investment pool -- such as pension plans -- to be marked-to-market. The new rules, effective for financial statements for periods beginning after June 15, describe how fair value should be defined, measured, applied and what information about fair value should be reported in the notes to financial statement.

Transparency. Inclusiveness. Consensus.