Proprietary Trading ban it curb it restrict it

Ban proprietary trading, curb proprietary trading in order to tame proprietary trading and its proprietary traders!

Proprietary trading or prop trading as it is usually called was at the helm of the last financial crisis in 2008. Once again it is this very form of trading activity and that has engulfed the US trading firm MF Global in the month of October 2011. 

So what exactly is this proprietary trading? In simple terms it is the form of trading activity that financial institutions carry out in the world financial markets with their own money. The proprietary traders or the prop traders as they are so called speculate the movements of bonds, currencies, stocks and derivatives items. They do so by means of taking some amount of leverage activity. In no time does this speculation turns intoxicating and the prop traders go on over speculating with their firms' money. This over speculation goes hand in hand with a higher leverage activity on the side of the firm, giving it an over exposure to the systemic risk that looms at large on the world markets. When Lehman Brothers collapsed in 2008, it had a leverage of somewhere around 34. When MF Global Holdings collapsed in the month of October 2011, it was leveraged somewhere close to 40 times its actual worth. So when such firms collapse, they not just collapse themselves, but in turn they bring down the entire system with them to rubble and ashes.

I would be expressing my strong views and opinions on this topic in the coming blogs and would try to keep you updated with the news and happenings across the globe, related to this prop bomb that causes widespread systemic financial crashes and explosions !!!

7th Annual FIA Asia Derivatives Conference 2011

• What? The 7th Annual FIA Asia Derivatives Conference 2011
• When? 29 November - 1 December, 2011
• Where? St. Regis Singapore

FIA - Futures Industry Association

The 7th Annual FIA Asia Derivatives Conference 2011 is a one of its kind conference that involves programs, exhibitors and delegates of high class and quality. More than 150 firms worldwide send around 450 delegates to attend this annual event. The FIA Asia conference is the place where you get to network with executive level and other senior managers in the Asia Pacific region since they comprise nearly 76% of the delegate list.

Asia is considered as the fastest growing region in the world and this conference highlights, shares and discusses the trends and opportunities that are present here. Watch some of the leading players in regional markets debate the challenges in Asia of OTC clearing, the changing nature of the markets in a high-speed world, and the commodity markets next door to the biggest, fastest-growing consumers of commodities in history.

The Asset Management Conference 2011

• What? The Asset Management Conference 2011
• When? 30 November to 01 December 2011
• Where? IET London: Savoy Place

This conference is being organized by The IET (Institution of Engineering and Technology) and the IAM (Institute of Asset Management).

The IET and IAM annual Asset Management conference 2011 has for the first time made a call for papers for this event. The programme will feature presentations of accepted papers that have been submitted from various sector industries and academia.

The prime focus of this conference is to advance knowledge and share understanding and thinking on the management of physical assets and strengthen the link and bridge the gap between industry, academia and research. Workshops would be conducted to offer a truly international insight into best practice asset management.

Kindly refer to the event website for full details, pricing and how to register for the event.

The FAST Conference 2011 on November 21, 2011

• What? The FAST Ltd Conference 2011 
• When? November 21, 2011
• Where? Twickenham Rugby Stadium.  

The conference is for the Directors, CEO s and the IT professionals. The theme of the conference is to stress the need for better, efficient and increased cooperation between business and the IT department. Focus would also be laid on the security and cost management issues at large. Software Asset Management (SAM) and IT Compliance also form part of the discussion. 

Experienced industry speakers and analysts would even conduct two separate streams of presentations, namely,  ‘Finance and Business’ & ‘Technology and Soft Skills’ on the day. Registered users would be able to attend either of the above two presentations.

Keynote speakers:
Ross Wilson, Chairman IOD Berkshire
Ben Hunt-Davis, Olympic Games Gold Medal Winner

Finance & Business Stream:
Andy Cook of VRL  Financial News
Chris Rawson, MD, exvine
Kirstin Furber of BBC Worldwide
Mark Jackson, PR/Rugby Referee

Technology and Soft Skills Stream:
Doug Clark of IBM
Frank Joshi of Mvine
Peter Hubbard of Pink Elephant
Chris Hurst of BT

After the event delegates will be able to attend a complimentary tour of the stadium.

Delegate Rates

For FAST Ltd Customers  - £269 + VAT per delegate
For non FAST Ltd customers - £399 + VAT per delegate

Technology in the Capital Markets

Firms rely on technology for capabilities ranging from high-frequency trading to risk management to derivatives pricing. That dependence will grow only deeper in the years to come as companies and regulators seek technological answers to portfolio and systemic risk.

- Irfan Khan, Vice President and Chief Technology Officer, Sybase, Inc.

The 2 golden rules to invest and make money in the stock markets

It is said that there are only 2 rules to invest in the stock markets and they are as follows -

1. You should never lose your money in the stock market
2. You should never forget rule number 1 

SEC Bans Unfiltered Market Access

After a couple of incidents of mistaken orders generated by humans or algorithmic systems which highlighted risks that could disrupt markets, it was being speculated since long that the U.S. Securities and Exchange Commission or SEC would pass new risk management standards. Although it was a necessary step, particularly in the aftermath of the May 6 "Flash Crash," the need to adopt such standards gained more prominence. Later on, SEC unanimously voted 5-0 to abolish so-called naked access to stock markets and require broker-dealers to check trades before they are made.

The law requires brokers or dealers with market access to establish, document, and maintain a system of risk management controls and supervisory procedures reasonably designed to manage the financial, regulatory, and other risks of this business activity.

Thereby it becomes increasingly important for us to know about the changes this law will bring in for the stock market professionals especially the broker-dealers segment.