Trade-supporting IT tools subject to a MiFID audit
- Category: MiFID
It is time now for traders to take a closer look at an IT infrastructure used to support trading decisions. What for? Do you think that you have nothing common with the algorithmic trading technique? You may be wrong...
Transfer of positions between hedging and speculative portfolios under the MiFID II and EMIR OTC derivatives reporting frameworks
- Category: MiFID
Internal policies must “define a priori“ the types of OTC derivative contracts included in the hedging portfolios.
Is it possible, then, to change the portfolios allocation after the trade was reported under EMIR and MiFID II?
Positive answer to this question may add some value to OTC derivatives trading strategies.
Systematic internaliser’s transparency - complicated puzzle
- Category: MiFID
It is difficult to capture all legal requirements with respect to transparency of the systematic internaliser’s quotes and transactions at a glance.
Firstly, the pre-trade and post-trade issues must be differentiated.
Another layer of complexity is introduced by distinct legal frameworks regulating systematic internaliser’s transparency for:
- bonds, structured finance products, emission allowances and derivatives, on the one hand, and
- shares, depositary receipts, ETFs, certificates and other similar financial instruments, on the other.
If to concentrate on products like bonds, structured finance products, emission allowances and derivatives firstly, it occurs that to determine transparency obligations we must separately analyse not only clients of the systematic internaliser and other market participants but also different categories of clients of the same systematic internaliser.
Liquid and illiquid markets have their specificities too.
To decode the respective requirements the diagram recently revealed by the ESMA is much helpful.
Do not miss the NC RfG notification deadlines!
- Category: Network Codes
Considering the lapsing deadlines set by the Commission Regulation (EU) 2016/631 of 14 April 2016 establishing a network code on requirements for grid connection of generators (NC RfG) it may be useful, particularly for energy market participants carrying out significant investments in or the refurbishments of the generation fleet, to take account of some NC RfG notification requirements that may occur important.
What does 'OTC equivalent' mean to you? Remarks on the dual nature of some key MiFID II definitions
- Category: MiFID
Complicated nature of MiFID II is expressed, inter alia, by the fact that given OTC derivative contract can be, concurrently - under the same MiFID II Directive - equivalent and not equivalent to the on-venue products.
This is not only the theoretical, cognitive disharmony but impacts directly on the scope of the trading position that can be taken in the derivatives market.
MiFID II position limits exemption - practical clues
- Category: MiFID
The two facts that may occur important for many market participants as regards the MiFID II position limits are as follows:
1. if you do not expect to exceed position limit, there is no need to apply in advance for a position limits exemption;
2. you are not required to monitor the position limit compliance of your clients.
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