Market makers – Chateau Langeais http://chateaulangeais.com/ Tue, 18 Oct 2022 07:01:48 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://chateaulangeais.com/wp-content/uploads/2021/10/icon-92-120x120.png Market makers – Chateau Langeais http://chateaulangeais.com/ 32 32 Market makers fight to recover millions trapped in former Russian broker https://chateaulangeais.com/market-makers-fight-to-recover-millions-trapped-in-former-russian-broker/ Tue, 18 Oct 2022 07:01:48 +0000 https://chateaulangeais.com/market-makers-fight-to-recover-millions-trapped-in-former-russian-broker/ Sova Capital fell into special administration after Russia invaded Ukraine Three of Europe’s biggest market makers, Jane Street, Flow Traders and GHCO, are fighting to recover millions of dollars in assets after Russian broker Sova Capital went into special administration following the invasion of the Ukraine by country. The trio all had funds held with […]]]>

Sova Capital fell into special administration after Russia invaded Ukraine

Three of Europe’s biggest market makers, Jane Street, Flow Traders and GHCO, are fighting to recover millions of dollars in assets after Russian broker Sova Capital went into special administration following the invasion of the Ukraine by country.

The trio all had funds held with the London-based company which filed for bankruptcy on March 3, just a week after the dispute began, as Russia was hit by a wave of financial sanctions from the west.

Consulting firm Teneo was appointed as a special co-administrator of Sova Capital, whose main activity was to provide its clients with access to Russian markets. At the time of its collapse, the company had $1.85 billion in assets on deposit and another $249.4 million in client money.

In its latest set of financial results, liquidity provider GHCO said it was seeking to recover $3.3 million in assets, including $1.2 million in two title transfer agreement (TTCA) accounts. ) and an additional $2.1 million in trades that had been executed but not yet. settled by Sova Capital.

Jane Street did not reveal how much they trapped in Sova Capital, however, ETF feeds understands that their assets represent almost 1% of the total funds held by the broker at the time of liquidation, or approximately $18 million.

According to its latest annual report, Flow Traders said it entered into an “interest-bearing credit facility” with Sova Capital in 2021, but did not disclose the value of the loan.

Jane Steet and Flow Traders will be an integral part of fundraising. The former was named a member of the creditors’ committee and the latter an observer, according to the first progress report from Teneo’s administration, published on September 26.

Jane Street and GHCO declined to comment. Flow Traders did not respond to a request for comment.

However, GHCO’s latest accounts have revealed that it expects to receive 40-60% of the value of its trapped assets within the next 12-24 months.

The company added that it had begun to reduce its exposure to Sova Capital in the week before the dispute began, due to “the potential impact of GH LLP’s activities” from sanctions imposed on Russian entities and the depository. Russian National Regulations. .

After the conflict, Western nations sought to limit Russia’s access to money, which ultimately led to the closure of the Moscow Stock Exchange, sending shockwaves through the ETF market.

MSCI said it was removing Russian stocks from its emerging markets indexes, while ETF issuers were forced to halt creation and redemption orders in primary markets.

In an October 6 creditors’ update, Teneo said it had received an offer to buy trapped assets worth £289million at a 15% discount from Dominanta, owned by the prominent man Russian businessman Roman Avdeev, also owner of the Moscow Credit Bank.

To proceed with the purchase, Dominanta LLC would need approval from the Central Bank of Russia, the Foreign Investment Control Commission or the President of Russia.

If approved, it is unclear whether Jane Street, Flow Traders or GHCO would receive any of the funds.

The dispute has had a far-reaching effect on ETF issuers, leading many, including BlackRock, to shut down their Russia-focused ETFs.

In September, ITI Funds said it was preparing to shut down its ETF business following the suspension of its two ETFs.

In August, PIMCO introduced the option to set up side pockets – cutting out highly illiquid assets from a fund – on its fixed income ETFs which are exposed to Russian sovereign debt.

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How Crypto Market Makers Are Unlocking Liquidity In The Digital World – CryptoMode https://chateaulangeais.com/how-crypto-market-makers-are-unlocking-liquidity-in-the-digital-world-cryptomode/ Thu, 13 Oct 2022 20:02:59 +0000 https://chateaulangeais.com/how-crypto-market-makers-are-unlocking-liquidity-in-the-digital-world-cryptomode/ We used to say that cryptocurrency is a young market with plenty of opportunities for its early explorers. And this is indeed the case, albeit relatively. Have you ever wondered how many tokens there are already? – more … than 12,000! Compared to the previous year, the number of digital coins has doubled in 2022. […]]]>

We used to say that cryptocurrency is a young market with plenty of opportunities for its early explorers. And this is indeed the case, albeit relatively. Have you ever wondered how many tokens there are already? – more … than 12,000! Compared to the previous year, the number of digital coins has doubled in 2022. But there is a simple explanation for this astonishing growth.

Thanks to the absence of barriers to entry and the interest in crypto assets, dozens of them are launched every day. As the market becomes too competitive, many good projects face liquidity issues that prevent mass adoption.

In order to overcome this problem, tokens associate with a crypto market maker – an institutional strength that creates an effective environment for all market players.

Who Are Crypto Market Makers?

The concept of “market makers” is as old as the traditional financial market. They act as an intermediary between a buyer and a seller, quoting orders from both sides to maintain a sustainable infrastructure for investors and traders.

Market makers serve the same purpose in the cryptocurrency market – they connect liquidity to various token projects as well as both centralized and decentralized crypto exchanges.

Who needs to partner with a crypto market maker?

As mentioned earlier, a liquid environment is critical to the survival of any project. An efficient market is naturally more attractive to traders and investors, which is why crypto tokens and exchanges with high levels of liquidity are bound to succeed.

Market Making for Crypto Exchanges

No crypto exchange can maintain a fair environment without a market maker. Liquidity is a hallmark of any trading platform – it serves as a green flag for investors and projects considering listing there.

  1. MM for CEX. An example below perfectly demonstrates why the need for market making is felt on centralized crypto exchanges. A trader places an order on illiquid CEX->the order takes a long time to fill because there is no trading activity->the order is miraculously filled with high slippage->the trader has no other choice but to go to another crypto exchange. In this case, the promise behind market making includes minimizing bid-ask spreads, maintaining trading activity, increasing order book depth, and preventing drastic market manipulation.

The more liquid an exchange is, the greater the number of new token listings. A sustainable environment is exactly what token issuers are looking for. You need to take the liquidity of your exchange seriously if you want it to thrive and grow.

  1. MM for DEX. Even though market making is generally considered an activity for centralized markets, there is work on decentralized platforms that can be done exclusively by specialized trading firms.

Since liquidity on DEXs is driven by automated market makers, all market making activities

solutions are linked to the management and constitution of liquidity pools. Crypto trading

companies are feeding liquidity on decentralized exchanges to prevent them from being

manipulated by pumpers and therefore encourage users to finance the pools themselves.

Market creation for tokens

Whether the token is listed or just planned to be, partnering with a market maker is essential for its effective performance on a crypto exchange. Having a crypto liquidity provider working for you guarantees:

  • Support for price and trade volume
  • Order book management
  • Additional Benefits of Arbitrage Trading
  • Built-in algorithms for liquidity risk management
  • Attract more sophisticated investors to your project
  • Pre-launch and post-launch support

The crypto market making ecosystem is diverse, with many operators in different markets. How do you choose one with deep expertise in a clear understanding of the market?

Say “Hi” to Bitquant!

BitQuant Capital is a value-focused market maker and one of the top-ranked crypto trading firms specializing in providing liquidity for digital assets and exchanges, including CEX and DEX.

Since 2019we have truly pursued our mission – to be a fair and reliable player helping token and exchange projects of all sizes achieve their secondary market liquidity and trading goals.

Our main competitive advantage stems from our strong quantitative approach, the expertise of our team and significant investments in breakthrough technologies.

What sets Bitquant apart from the rest?

Bitquant is more than a market maker – it’s your ecosystem partner in crime.

Conclusion

One of the biggest challenges for projects operating in the crypto space is liquidity and the only way to solve it is to partner with a market maker and a liquidity provider.

Market makers are a central part of the digital asset ecosystem, and even highly liquid exchanges and tokens use these services.

The best way to start your market making strategy is to consult an expert first. Fill in the brief form to receive a free consultation from one of Bitquant’s professionals. Or take a look at our website to fully explore our services and solutions.

CryptoMode produces high quality content for cryptocurrency companies. To date, we’ve provided brand visibility for dozens of companies, and you can be one of them. All our customers appreciate our value for money ratio. Contact us if you have any questions: [email protected]

None of the information on this website is investment or financial advice. CryptoMode is not responsible for any financial losses incurred while acting on the information provided on this website by its authors or customers. No advice should be taken at face value, always do your research before making financial commitments.

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The new market makers: what this change means for you https://chateaulangeais.com/the-new-market-makers-what-this-change-means-for-you/ Mon, 03 Oct 2022 10:36:10 +0000 https://chateaulangeais.com/the-new-market-makers-what-this-change-means-for-you/ Coin Liquidity Solutions (CLS Global) is a growing sales and marketing agency focused on cryptocurrencies. It provides various services to ensure that all the goals of your challenge project are met. With over five years of experience in the market, CLS Global has the knowledge and skills to bring you the best. Over the years […]]]>

Coin Liquidity Solutions (CLS Global) is a growing sales and marketing agency focused on cryptocurrencies. It provides various services to ensure that all the goals of your challenge project are met. With over five years of experience in the market, CLS Global has the knowledge and skills to bring you the best.

Over the years they have been in business, CLS Global has created over 60 marketing campaigns and currently has over 200 active clients. The platform also has over 80 integrated exchanges.

The crypto industry is growing more than ever, which is why crypto-related industries have discovered many innovative ways to improve their systems. Market makers are not excluded from this equation. As an integral part of the crypto industry, market makers have had to adapt to changes.

Nowadays, Market Making cannot be simply automated by software algorithms. It must be manually assisted with the most appropriate strategy developed for each project. This is the best way to achieve maximum efficiency. Customer centricity is one of the most important aspects of their business model, as they know that automated market makers aren’t as effective as they used to be. CLS Global is dedicated to providing the best to its customers, which is why they include guidance to cover their partners’ needs and help them grow.

CLS Global has grown over the years leading to the creation of new products designed to enhance the customer experience. The platform prides itself on its ability to deliver quality results at all times. You can grow your market quickly and seamlessly when you choose CLS Global.

New products were created taking into account the needs of customers. The growth that CLS Global has experienced over the years has been rapid but not shocking. CLS Global’s customer-centric approach to market building makes it an incredible platform that attracts many users. Companies that focus more on their customers tend to do better in the long run. CLS Global’s business model revolves around its customers and how best to serve them.

The team behind this agency is made up of industry professionals with years of experience. They have worked with several clients over the years and helped them achieve their project goals. They are determined to provide only the best to their customers.

The company provides CEX Trading development, market making and marketing development, and SMM for crypto projects. Clients can take advantage of these awesome tools and use them to enhance their projects.

Additionally, CLS Global will add a range of new products including DEX Volumes, Market Making, DEX AntiSnipe Bot and CLS GLobal Conference. The CLS Conference is an all-inclusive party that will take place on the highest rooftop in Dubai. It’s called “Network & Invest with CLS” and it will be a great opportunity for like-minded crypto enthusiasts to network and explore new business opportunities. All customers, partners and friends of the company are welcome.

This conference is exactly what you need if you want to meet industry leaders, investors, top experts, and influencers in the crypto field. Enjoy a magical night in a pleasant atmosphere to meet new people and exchange ideas. Quality networking is guaranteed for all guests present. The event will also include exclusive cocktails from Dubai’s top bartenders, delicious refreshments and entertainment. It will take place at “The Privilege bar”, one of the most emblematic places in the world. This bar is listed in the Guinness Book of Records and considered one of the tallest bars in the world

CLS Global has grown significantly since its launch over half a decade ago. This growth is due to the company’s determination to provide its clients with quality results in all circumstances.

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Hong Kong uses market makers for yuan-denominated stocks https://chateaulangeais.com/hong-kong-uses-market-makers-for-yuan-denominated-stocks/ Mon, 03 Oct 2022 07:00:00 +0000 https://chateaulangeais.com/hong-kong-uses-market-makers-for-yuan-denominated-stocks/ A government minister said the new connection scheme mechanism is expected to boost trading, helping the hub recover lost ground. A yuan trading system using a market maker mechanism will be implemented in the first half of 2023, according at the “South China Morning Post”, a local English-language daily newspaper (registration, possible paywall) which quoted […]]]>

A government minister said the new connection scheme mechanism is expected to boost trading, helping the hub recover lost ground.

A yuan trading system using a market maker mechanism will be implemented in the first half of 2023, according at the “South China Morning Post”, a local English-language daily newspaper (registration, possible paywall) which quoted a government minister discussing the developments with lawmakers on Monday.

The SCMP said the plan was first announced last month and approved by the China Securities Regulatory Commission (CSRC) last month.

The government intends to launch the new market maker mechanism with the Hong Kong Stock Exchange as part of an effort to strengthen the city’s position as a financial hub. As finenews.asia Recently reported, Singapore overtook Hong Kong to become the world’s third-largest international financial center due to the prolonged period of strict travel restrictions related to COVID-19.

Small business

The exchange has allowed companies to issue yuan-denominated shares since 2010, but limited turnover prompted very few to take the step, the SCMP said.

Christopher Hui Ching-yuthe government secretary responsible for financial services and the treasury, told the newspaper that a market maker mechanism will alleviate this problem, as it promotes liquidity, limits spreads as well as excessive price fluctuations.

According to the SCMP, the government intends to submit a bill by the end of the year exempting market makers from paying stamp duty if they provide liquidity for yuan-denominated shares. These duties currently account for 90 percent of trade costs, Hui said Monday. Additionally, mainland-based traders can currently only trade shares of the city in Hong Kong dollars, which would remove an additional hurdle and limit exposure to currency fluctuations.

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Boursa Kuwait organizes a seminar to discuss the role of market makers https://chateaulangeais.com/boursa-kuwait-organizes-a-seminar-to-discuss-the-role-of-market-makers/ Tue, 27 Sep 2022 12:34:58 +0000 https://chateaulangeais.com/boursa-kuwait-organizes-a-seminar-to-discuss-the-role-of-market-makers/ Kuwait – Boursa Kuwait organized a seminar for listed companies to shed light on the mechanism and performance of Market Makers and their role in improving securities liquidity. The seminar focused on the importance of liquidity and general mechanisms to improve it as well as the requirements of market makers and key factors to consider […]]]>

Kuwait – Boursa Kuwait organized a seminar for listed companies to shed light on the mechanism and performance of Market Makers and their role in improving securities liquidity. The seminar focused on the importance of liquidity and general mechanisms to improve it as well as the requirements of market makers and key factors to consider when dealing with them. Participants also discussed the willingness of companies eligible for the Premier upgrade to deal with market makers and the types of agreements between listed companies and their market makers.

The seminar was moderated by Mr. Bader Al-Nesef, Deputy Director of Institutional Investor Affairs at Boursa Kuwait, who was joined by panelists Mr. Fahad Al-Rushaid, Vice President of MENA Equities at Kuwait Financial Center “Markaz “, and Mr. Sulaiman Al-Musallam, Deputy Director – Market Maker Department in the Asset Management Sector of Kuwait Investment Company.

The seminar is part of Boursa Kuwait’s commitment to raise awareness of the effective role of market makers in improving liquidity, which can lead to attracting more investors wishing to benefit from the market’s investment environment. Kuwaiti capital.

Commenting on the seminar, which witnessed a lively interaction from the participants, Mr. Bader Al-Nesef said: “We are currently seeing growing interest from listed companies, especially those that qualify for the “Premier” market, for the market maker tool for its active role and ability to provide liquidity on securities.

“Hosting this seminar is part of Boursa Kuwait’s efforts to increase the efficiency of the market and all its players by raising awareness of the tools and products offered and promoting their adoption. On behalf of Boursa Kuwait, I would like to thank the speakers and all the participants for their valuable contributions, which undoubtedly enriched the seminar,” added Al-Nesef.

Market makers help improve the liquidity of securities, improve the efficiency of the market and support the global adoption of all its tools. Market makers are also considered an integral part of trading in developed and emerging markets, for their ability to provide liquidity to their registered securities. Indeed, market makers connect buyers and sellers who wish to trade the same security. In the Kuwaiti capital market, market makers are investors who ensure the availability of supply and demand for one or more securities, in accordance with controls which may be issued or approved by the Capital Markets Authority ( CMA).

Mr. Fahad Al Rushaid, Assistant Manager – MENA Equities at Kuwait Financial Center “Markaz” said: “The demand on market makers is due to the role they play in providing liquidity to listed companies, due to the rules and clear obligations of the mechanism and listed companies. be comfortable with them. All listed companies can use market makers, and market makers can trade in treasury stock or stock of individual shareholders. Market makers can also work for a designated fee or for an incentive percentage of trades if the volume of trades reaches a certain point, options that undoubtedly give businesses the flexibility to use this tool as they see fit. I would like to thank Boursa Kuwait for organizing this seminar and to salute the stock exchange’s overall efforts to publicize the market maker tool.

Kuwaiti Financial Center “Markaz” received the license to operate as a market maker at the end of 2019 and is currently registered as a market maker for seven securities. Established in 1974, “Markaz” was listed on the Kuwait Stock Exchange in 1997.

Mr. Sulaiman Al-Musallam, Assistant Manager Market Maker Department, Asset Management Division at Kuwait Investment Company also commented on this occasion: “I would like to thank Boursa Kuwait for hosting this seminar, which gave us an extraordinary opportunity to clarify several important for market players, the sharing and exchange of views and the promotion of financial literacy. The market maker has become an invaluable tool for companies looking to provide more liquidity for their stocks. Investment companies that offer this service want to contribute to the development of the market, allowing them to record higher profits.

The Kuwait Investment Company started operating as a market maker in 2021 and is currently registered as a market maker in three securities. The Kuwait Investment Company was established in 1961 as the first investment company in Kuwait and the region and was listed on Boursa Kuwait in 1984.

The organization of seminars and training programs is part of Boursa Kuwait’s efforts to create a significant and lasting impact on the communities in which it operates as part of its sustainability strategy, as well as the company’s ongoing efforts. to equip all market participants with a thorough understanding of how capital markets work and various tools and techniques needed to make informed investment decisions and respond effectively to investors’ needs.

Since its inception, Boursa Kuwait, a self-listed company and one of the government entities to be successfully privatized, has implemented numerous measures in line with international practices and standards to improve the position of the stock exchange regionally and world, as well as transforming Kuwait. in a regional and global investment destination, focusing on building an attractive issuer base and broadening its investor base, increasing the depth and breadth of its products, as well as putting upgrade its infrastructure and business environment to international standards.

-Ends-

ABOUT BOURSA KUWAIT

Since its establishment by the Capital Markets Authority to take over the responsibilities of the Kuwait Stock Exchange in 2014, Boursa Kuwait has worked diligently to build a progressive exchange platform based on efficiency and transparency, with a view to create long-term value for the company’s stakeholders in the economic, social and environmental dimensions.

Guided by a mission-driven strategy focused on market development in line with international standards, Boursa Kuwait has successfully introduced innovative investment tools, enhanced transparency and restructured the market to increase its competitiveness and liquidity. The company’s market developments and improvements have contributed to the reclassification of the Kuwaiti capital market to “emerging market” status in all three major global indices, strengthening Kuwait’s position as a leading financial center in the region. . A self-listed stock exchange, Boursa Kuwait is the first government entity in the country to be successfully privatized.

For more information on Boursa Kuwait’s initiatives and latest developments, visit www.boursakuwait.com.

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Orbs Unveils New TWAP Protocol for Decentralized Exchanges and Automated Market Makers https://chateaulangeais.com/orbs-unveils-new-twap-protocol-for-decentralized-exchanges-and-automated-market-makers/ Thu, 22 Sep 2022 13:04:42 +0000 https://chateaulangeais.com/orbs-unveils-new-twap-protocol-for-decentralized-exchanges-and-automated-market-makers/ Tel Aviv, Israel, September 22, 2022, Chainwire Orbs’ decentralized time-weighted average price (TWAP) order protocol aims to overcome DeFi’s liquidity and volatility issues while opening up opportunities for traders and platforms. Are you looking for fast news, tips and market analysis? Sign up for the Invezz newsletter today. Orbs the decentralized layer 3 blockchain infrastructure, […]]]>

Tel Aviv, Israel, September 22, 2022, Chainwire

Orbs’ decentralized time-weighted average price (TWAP) order protocol aims to overcome DeFi’s liquidity and volatility issues while opening up opportunities for traders and platforms.

Are you looking for fast news, tips and market analysis? Sign up for the Invezz newsletter today.

Orbs the decentralized layer 3 blockchain infrastructure, introduced a new decentralized time-weighted average price (TWAP) protocol to support new order types for decentralized exchanges (DEX) and automated market makers ( MA).

TWAP is frequently deployed by algorithmic trading strategies in the centralized finance (CeFi) landscape. Traders rely on the Time-Weighted Average Price (TWAP) method to minimize the impact of a large order on the market by dividing the order into multiple smaller trades, with each trade being executed at regular intervals defined over a given period.

Although the decentralized finance (DeFi) ecosystem has grown into a multi-billion dollar industry, the existing infrastructure, primarily the limitations of EVM smart contracts, makes it very difficult to implement TWAP in a decentralized format. On top of that, the current DeFi ecosystem has few features designed to handle the issues of increased volatility and liquidity that regularly occur in the decentralized crypto-economy.

With its decentralized TWAP protocol powered by its Layer 3 technology, Orbs overcomes these shortcomings while simultaneously benefiting merchants and trading platforms by significantly reducing the material price impacts that come from large orders. Orbs’ decentralized backend ensures that all TWAP commands are executed at optimal price and fair fees without sacrificing decentralization and security. As a result, participating DEXs and AMMs offer their users more ways to engage in sophisticated trading activities, especially algorithmic strategies like those common in CeFi, while benefiting from liquidity and activity of increased users.

The protocol also allows users to take advantage of Automated Dollar Cost Averaging (DCA) – an investment strategy in which an investor purchases an asset or set of assets at a defined fiat value according to a pre-determined schedule. The Orbs TWAP protocol can be used to generate an automated version of the DCA strategy, allowing traders to enter market orders with longer intervals and extended durations. In effect, the TWAP protocol can serve as an automated DCA trading bot that does not require any additional input from the trader.

In technical terms, Orbs’ Layer 3 infrastructure extends the capabilities of existing EVM smart contracts. By leveraging network validators as off-chain bidders, Orbs TWAP will allow DEXs and AMMs to unlock new opportunities in a fully decentralized and secure framework.

Orbs TWAP smart contracts consist of two elements: a market maker and a market maker. While the ‘maker’ (user or originator of the order) controls all the parameters related to the order, such as limit price, size, expiration and timeframe, ‘takers’ are incentivized participants who monitor orders and are selected for trade execution after submitting bids. , including lessee fees. The highest bid and the lowest fee are automatically selected for execution.

In addition to the TWAP protocol, the Orbs team has developed a new user interface (UI) that DEXs and AMMs can easily integrate into their existing infrastructure. The new user interface is intuitive and user-friendly, allowing users to customize settings and initiate TWAP transactions.

Nadav Shemesh, CEO of Orbs, notes, “We always see CeFi as a model for new protocols that can improve the experience of our stakeholders, and TWAP (Time-Weighted Average Price) was no exception. Until now, it was extremely difficult to implement a TWAP strategy in blockchain-based financial primitives in a decentralized way using EVM-based smart contracts. With our new TWAP protocol, everyone benefits, whether traders or trading platforms. Along with better liquidity management, support for more sophisticated trading strategies, automated DCA orders, customizable settings and more can also help us attract in-kind institutional participation.

About Orbs

Orbs is a public, decentralized blockchain infrastructure operated through a secure network of permissionless validators and the Proof-of-Stake (PoS) consensus mechanism. The platform serves as a decentralized execution layer between the existing Layer 1 and Layer 2 chains and the application layer. By enhancing the capabilities of EVM smart contracts, Orbs is powering new use cases for DeFi, NFT, GameFi, and other emerging blockchain-based industries.

Contact

Hammer run, [email protected]

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Torstone Technology: The Post-Trade Challenge for Market Makers https://chateaulangeais.com/torstone-technology-the-post-trade-challenge-for-market-makers/ Thu, 22 Sep 2022 09:01:03 +0000 https://chateaulangeais.com/torstone-technology-the-post-trade-challenge-for-market-makers/ Market makers, essential for quickly providing liquidity to retail and institutional financial firms, face new challenges in a rapidly changing market. Simply focusing on one corner of the market won’t be enough, so how do they adapt to the post-trade challenge? brian CollingsCEO of Torstone Technology examines the specific challenges and nuances of the back […]]]>

Market makers, essential for quickly providing liquidity to retail and institutional financial firms, face new challenges in a rapidly changing market. Simply focusing on one corner of the market won’t be enough, so how do they adapt to the post-trade challenge?

brian CollingsCEO of Torstone Technology examines the specific challenges and nuances of the back office for market makers. He explains how the volume of data increases in the market as companies diversify between assets, as well as the shortening of the settlement cycle, and their impact on market makers:

Brian Collings, CEO of Torstone Technology

The global economy is becoming increasingly interconnected and borderless, especially in the emerging digital asset space, and market makers are no different. As volatility and trading volumes increase, companies must manage huge changes in their operational infrastructure in the post-trade space to stay resilient and competitive.

One consequence of this change is that we are seeing trends develop in the way market makers approach their post-trade needs – ensuring they are able to keep pace with the massive influx of new customers as that we are entering a difficult period in global markets when access to liquidity will be more important than ever. As market makers adapt to a new market, so do we – finding innovative new ways to process and accurately report such a high volume of transactions in real time, all at the blink of an eye.

Volumes on the rise

The rapid pace of change has been a major challenge for market makers over the past decade. Traditionally, capital markets firms focused on a single corner of the market – be it currencies, fixed income or equities – but as investment firms and retail traders increasingly explore new asset classes and trading strategies, modern market makers have spread across multiple asset classes and geographies. to satisfy the demand for unique sources of deep and varied liquidity.

A layer of complexity added recently has been the emergence and adoption of cryptocurrencies as an asset class, which has also led market makers to further expand their trading operations as trading volumes have increased. .

Driven by the electronicization of the market and an explosion of retail participation and volatility, the rapid growth of the market in such a short time has strained the existing infrastructure and in some cases has proven to be inadequate to cope with such large volumes.

Faster settlement

Not only are business operations more global and multi-asset, they also need to become faster than ever. In addition to dealing with much larger volumes, market makers also have to deal with regulatory and customer demand for faster settlement.

Speed ​​and flexibility are of vital importance to market makers and their partners. Notably, over the past two decades, capital markets have seen a trend towards increasing the speed at which transactions are settled. The United States is currently in the process of reducing settlement cycles from a two-day settlement cycle to T+1.

A reduction in the settlement cycle will likely be a good thing, acting as an accelerator of change by encouraging capital creation, reducing balance sheet risk and providing an opportunity to drive better processing and innovative use of technology for the market.

This however adds a layer of complexity for market makers and their service providers, in preparing their systems and infrastructure for a much shorter settlement time, but also in navigating the different requirements of a jurisdiction. to the other. A key consideration for global market makers is therefore how to manage the different regulatory requirements in all the regions they operate in, where the specific rules and settlement times may differ.

The post-trade opportunity

Market makers are adapting to these changes through higher levels of automation, faster settlement, and adoption of more interconnected systems, reducing their legacy architecture.

The modular, cloud-based post-market architecture has proven capable of handling huge volumes while giving companies the flexibility to add new assets, regions, and technologies as they adapt to changing markets. rapidly evolving. Legacy systems have become entrenched in the enterprise architecture, but in many cases they pose a risk as the weight of global demand pushes them beyond their capacity.

Modern market makers are among the most sophisticated businesses in the capital markets, but they need to think carefully about their post-trade needs. Front office demands, from reducing trading latency to increasing access to liquidity, will always be a top concern, but it shouldn’t be overlooked to ensure their architecture is scalable and designed to the future.

Cloud-based SaaS platforms are the answer for market makers, making it easy for firms to equip themselves with powerful technology to handle highly complex and intensive post-trade processes, while allowing them to focus on their trading technology. In a rapidly changing world, reducing operational complexity to deal with uncertain markets is more valuable than ever.

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IMF warns role of market makers in ETFs ‘requires close monitoring’ https://chateaulangeais.com/imf-warns-role-of-market-makers-in-etfs-requires-close-monitoring/ Thu, 22 Sep 2022 08:34:10 +0000 https://chateaulangeais.com/imf-warns-role-of-market-makers-in-etfs-requires-close-monitoring/ Two APs claim 90% of the business of the largest ETF issuer The International Monetary Fund (IMF) has said the Central Bank of Ireland (CBI) should encourage ETF issuers to use more liquidity providers to ensure these relationships can withstand market stress events. market. The international policymaker said the role of liquidity providers poses a […]]]>

Two APs claim 90% of the business of the largest ETF issuer

The International Monetary Fund (IMF) has said the Central Bank of Ireland (CBI) should encourage ETF issuers to use more liquidity providers to ensure these relationships can withstand market stress events. market.

The international policymaker said the role of liquidity providers poses a key risk within ETFs, as only authorized participants (APs) have direct access to ETFs for creation and redemption activities, while market makers can withdraw at any time from providing liquidity.

He added that the CBI’s work had already identified concentration risk within the liquidity provider space, with just two players responsible for up to 90% of AP activity for some ETFs from the largest issuer. European BlackRock.

Additionally, while there is no evidence that market makers walked away from the market during the volatility of COVID-19, the IMF said this is an area that “requires monitoring. narrow”.

He said: “Relevant central bank oversight teams should engage with ETF providers to ensure that their agreements with APs and market makers are robust and support the smooth functioning of the sector, including in times of market stress.

“There should also be closer cooperation between investment fund supervisors and colleagues overseeing APs and market makers.”

Apart from liquidity providers, the IMF has also identified price discount risk – the difference between an ETF’s market price and its net asset value (NAV) – as another area of ​​focus.

He said this risk materialized during the COVID-19 disruption, when the disparities between the share price of some fixed income ETFs and the value of their assets reached 17%, although these discounts have usually gone within a week.

However, regulators and industry bodies such as the International Organization of Securities Commissions (IOSCO), the Bank of England and the Bank for International Settlements were quick to point out that the March 2020 volatility underlined to how ETFs were a source of price discovery for investors as bonds did not trade.

Interestingly, the CBI published a white paper in 2020, titled Information and Liquidity Links in ETFs and Underlying Markets, which found that the close information links between ETFs and stocks create potential of “illiquidity contagion” during ETF demand shocks – as both are exchange-traded – while over-the-counter (OTC) bonds are less susceptible.

However, ETF industry participants said the CBI failed to consider the role of the secondary market in providing an additional layer of liquidity for ETFs.

The IMF also highlighted the potential for settlement delays given that ETF trading is fragmented, but said much of this had been mitigated by the migration of all Irish-domiciled ETFs to the ICSD model. after Brexit.

The policymaker’s comments on ETF trading follow IOSCO’s draft of its latest set of ETF best practices in April, which also stressed that ETF issuers should “execute due diligence” on PAs. and market makers and avoid exclusive agreements with individual liquidity providers.

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China Securities and seven other brokerages become first market makers for Star Market https://chateaulangeais.com/china-securities-and-seven-other-brokerages-become-first-market-makers-for-star-market/ Mon, 19 Sep 2022 07:00:00 +0000 https://chateaulangeais.com/china-securities-and-seven-other-brokerages-become-first-market-makers-for-star-market/ (Yicai Global) Sept. 19 — Eight brokers, including China Securities, have received regulatory approval to become the first batch of market makers for the Shanghai Stock Exchange’s Nasdaq-style Star Market. According to a notice issued by China Securities and Regulatory Commission posted on its website on September 16. The National Equities Exchange and Quotations, commonly […]]]>

(Yicai Global) Sept. 19 — Eight brokers, including China Securities, have received regulatory approval to become the first batch of market makers for the Shanghai Stock Exchange’s Nasdaq-style Star Market.

According to a notice issued by China Securities and Regulatory Commission posted on its website on September 16.

The National Equities Exchange and Quotations, commonly referred to as the new third council, introduced the mechanism of market makers in August 2014. China’s securities regulator said it would pilot market making on Star Market in January.

Star Market will gradually transform into a hybrid transaction mechanism from the existing price auction transaction after the introduction of market makers, Yicai Global learned from the brokerage houses. Market makers will provide the market with sustained liquidity, increase price efficiency and reduce price swings caused by speculation, they said.

The market making business will become a new source of profit for brokerage firms as it can grow in coordination with existing investment banking and research and advisory businesses to provide more comprehensive services to customers and increase the core competitiveness of brokerage houses, Orient Securities pointed out.

To become market makers for Star Market, brokerages need a net capital of at least CNY 10 billion (USD 1.4 billion) in the past 12 months and a rating above A in during each of the last three years. China’s leading brokerage firm Citic Securities and others have disclosed plans to apply to conduct market-making activities for Star Market earlier, Yicai Global has learned.

Star Market started operations in July 2019. It was the first market in the Chinese mainland to pilot the registration-based IPO system, allow loss-making technology companies and those to be listed. with special capital structures, and to expand the imposed daily exchange. limit to 20% compared to 10% on the main card market.

The 463 companies listed on Star Market had a total market capitalization of nearly 5.8 trillion yuan ($832.9 billion) as of September 16, according to SSE data.

Editors: Dou Shicong, Futura Costaglione

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Motilal Oswal MF to reopen two foreign ETFs for market makers https://chateaulangeais.com/motilal-oswal-mf-to-reopen-two-foreign-etfs-for-market-makers/ Fri, 16 Sep 2022 07:50:11 +0000 https://chateaulangeais.com/motilal-oswal-mf-to-reopen-two-foreign-etfs-for-market-makers/ NEW DELHI: Asset management company Motilal Oswal Mutual Fund is set to reopen two international programs, Motilal Oswal Nasdaq Q50 ETF and Motilal Oswal Nasdaq 100 ETF, from Monday for subscription or creation of units. Admittedly, the two exchange-traded funds (ETFs) would only be open to authorized participants or market makers from September 19 until […]]]>

NEW DELHI: Asset management company Motilal Oswal Mutual Fund is set to reopen two international programs, Motilal Oswal Nasdaq Q50 ETF and Motilal Oswal Nasdaq 100 ETF, from Monday for subscription or creation of units.

Admittedly, the two exchange-traded funds (ETFs) would only be open to authorized participants or market makers from September 19 until further notice.

Liquidity in ETFs is created by market makers called authorized participants, who are pre-appointed by AMCs to enhance the liquidity of ETFs.

In February, the Securities and Exchange Board of India (Sebi) advised mutual funds investing in foreign securities to stop new investments in foreign stocks to avoid exceeding overseas limits in India. industry scale.

The regulator specified an aggregate limit of $7 billion for mutual funds to invest in foreign securities and funds and a separate limit of $1 billion for investing in foreign ETFs.

The Association of Mutual Funds in India (Amfi) had notified in June that mutual funds could resume subscriptions and make investments in foreign funds/securities up to the available margin without breaching the investment limits. abroad on February 1, 2022.

“Now, as we have margin available with us, we are reopening direct creation in Motilal Oswal Nasdaq Q50 ETF and Motilal Oswal Nasdaq 100 ETF only for authorized participants/market makers,” Motilal Oswal Mutual Fund said in a notice.

“We will monitor the regulatory limits and once the limited margin is reached, we will have to restrict the subscription again,” he added.

Investors should note that the fund house maintains the subscription, purchase or SIP restriction for Motilal Oswal S&P 500 Index Fund, Motilal Oswal Nasdaq 100 ETF Fund of Fund and Motilal Oswal MSCI EAFE Top 100 Select Index Fund.

The fund house also stressed that it is constantly engaging with the regulator to tighten limits on overseas investment by mutual funds.

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