ON THE MONITOR
Before Rules are Written, Technology is Advancing for OTC Derivatives Buyers
May 24, 2010
Efforts to ensure that trading in derivative securities cannot run amok will almost certainly result in major changes to this $604 trillion market. Key provisions in the financial reform legislation coming out of Congress include giving both the Securities and Exchange Commission and the Commodity Futures Trading Commission authority to regulate OTC derivatives, and central clearing and trading on public exchanges of derivative contracts that can be standardized.
But despite the fact that reforms await reconciliation of the House and Senate bills, technology serving hedge funds and other players in the huge and rapidly changing over-the-counter derivatives marketplace is rapidly advancing.
“I think there is great potential,” says Denise Valentine, a senior analyst with Boston-based research firm Aite Group, who has been covering OTC derivatives technology providers since 2004. “The OTC derivatives market remains a vibrant part of the capital markets landscape, and one that will continue to recover with the overall market in time.”
THE WEEK AHEAD:
MONDAY, MAY 24
SPEECH: SEC Commissioner Luis Aguilar
8:45 a.m., Compliance Week 2010, Mayflower Hotel, Washington, D.C.
OPEN MEETING: Joint CFTC-SEC Advisory Committee on Emerging Regulatory Issues
9 a.m., SEC Headquarters, 100 F Street NE, Room L-002 (Auditorium), Washington, DC
WEDNESDAY, MAY 26
WEBCASTS: FINRA Annual Conference
Through May 28. The Financial Industry Regulatory Authority, Baltimore, MD
7:30 a.m., Capital Markets Consortium, Bayards, New York
HEARING: Anti-Money Laundering: Blocking Terrorist Financing
10 a.m., House Financial Services Committee, Rayburn House Office Building
THE WEEK THAT WAS:
SEC Distributes $178 Million from Millennium Fair Fund
CFTC Establishes Technology Committee Focused on Derivatives
SIFMA Opposes Reform Bill Passed By Senate
Spending on IT By Banking, Securities Firms Tops Forecast
S&P Assails “Unintended Consequences” of Senate Reform Bill
DTCC Issues Own Version of Standardized Messages On Actions
Securities watchdog is changing, but maybe not fast enough
Goldman and Washington's Wall Street Takeover
CFTC Economist Theorizes High-Frequency Traders Can Tame Prices
