The British Columbia Securities Commission (BCSC) today announced that it strongly supports taking action to strengthen the client-registrant relationship through a sweeping set of targeted reforms to the obligations that registrants owe to their clients (NI 31-103). Proposed targeted reforms to 31-103 were published for comment today in the CSA’s Consultation Paper 33-404: Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Client (the Consultation Paper).
“All CSA jurisdictions agree that we can do better for investors in their existing client-registrant relationship, and improving investor outcomes is a goal we all share,” said Nigel Cave, Vice-Chair of the BCSC. “Raising the standards of conduct for registrants is clearly in the interests of investors, and we are convinced that the best way to achieve this is to implement the proposed targeted reforms on their own.”
The BCSC believes that the overlay of the proposed best interest standard is not workable in the current regulatory and business environment, and may cause investors to think registrants have an unqualified duty to act in their best interests, not understanding that some conflicts would still be permitted. This may exacerbate one of the investor protection issues identified by the CSA – overreliance by clients on registrants. Implementing only the specific targeted reforms will meaningfully and practically address problems in the client-registrant relationship identified by the CSA, and will provide regulators with the tools necessary to ensure compliance and pursue enforcement action, where necessary.
“We believe the targeted reforms establish clear, practical, and enforceable requirements for registrants to follow and for regulators and courts to enforce, all in a way that will not raise expectations about investor protection that may not be realized,” said Cave. “We have concluded that the proposed targeted reforms, combined with the full realization of the CRM2 and Point of Sale initiatives, will achieve the best outcomes for investors and significantly improve investor protection.”
The Consultation Paper can be found on CSA members’ websites. Comments must be submitted in writing by August 26, 2016.
BCSC Supports Raising The Standards Of Conduct For Registrants
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Testimony Of ISDA CEO Scott O'Malia Before The US House Of Representatives Committee On Agriculture, Subcommittee On Commodity Exchanges, Energy, And Credit
Chairman Scott, Ranking Member Scott and Members of the Subcommittee. Thank you for the opportunity to testify today.
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CalPERS Hears Report On The Financial Benefits Of Diversity And Inclusion In The Global Corporate Market - Private Sector Guests Make The Business And Economic Case For Board Diversity
Diverse corporate boards and companies that embrace diversity lead to better financial performance, according to data presented to the California Public Employees' Retirement System's (CalPERS) Investment Committee.
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NZX Q1 2016 Revenues And Shareholder Metrics
NZX’s Q1 2016 revenue report released today shows total group revenue grew 9.6% compared to Q1 2015, largely driven by NZX’s funds services business, increased trading activity in the capital markets, and strong growth in the debt market. While market conditions in the agri sector were challenging, total agri revenues were still up 3.5% as a result of increased grain trading activity.
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NZX: Ralec Litigation Update
The High Court trial in relation to the Ralec proceedings is due to commence next week. Accordingly NZX is providing the following update in relation to this litigation.
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Toronto Stock Exchange Is Requesting Comments On Proposed Rule Amendments - Dividend/Distribution Reinvestment Plans
Toronto Stock Exchange ("TSX") has published for comment proposed amendments to Part VI of the TSX Company Manual (the "Manual"). The proposed amendments will introduce requirements regarding Dividend / Distribution Reinvestment Plans in new Section 617.1 of the Manual as well as certain other ancillary amendments to the Manual. Comments are requested on the proposed amendments by May 28, 2016.
The request for comments is posted on TSX's website at:
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Utility maximization problem with random endowment and transaction costs: when wealth may become negative. (arXiv:1604.08224v1 [q-fin.MF])
In this paper we study the utility maximization problem on the terminal wealth with proportional transaction costs and random endowment. Under the assumption of the existence of consistent price systems, which makes the duality approach possible, we consider the duality between the primal utility maximization problem and the dual one, which is set up on the domain of finitely additive measures. In particular, we prove duality results for utility functions supporting possibly negative values. Moreover, we construct the shadow market by the dual optimal process and exhibit the utility based pricing for the random endowment.
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SIX Swiss Exchange Ltd Fines Accu Holding AG
The Sanctions Commission of SIX Swiss Exchange has imposed a CHF 100,000 fine on Accu Holding AG for failing to comply with the rules on the listing of equity securities, disclosing management transactions and regular reporting obligations.
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LSEG: UnaVista Partners With Kaizen Reporting To Offer Industry Quality Assurance Solution
London Stock Exchange Group announced today that UnaVista, its global regulatory reporting platform, has partnered with leading regulatory reporting testing and compliance firm, Kaizen Reporting. The partnership will give UnaVista clients access to Kaizen Reporting’s ReportShield™ service, which offers quality assurance testing of MiFID transaction reports at a field level, as well as governance training and consultancy.
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The Saudi Stock Exchange Announces The Publication Of The Monthly Stock Market Ownership And Trading Activity Report (By Nationality And Investor Type)
The total value of shares traded for the month ending 28 April 2016 amounted to SAR 117.61 billion, decreasing by 10.36% over the previous month; while total stock market capitalization reached SAR 1,558.55 billion at the end of this period, increasing by 8.44% over the previous month.
The total value of shares purchased by "Saudi Investors" during this period amounted to SAR 111.93 billion representing 95.17% of total buying activity, and sales of SAR 112.38 billion representing 95.55% of total selling activity. Total ownership of "Saudi Investors" stood at 93.08% of total market capitalization as of 28 April 2016, representing an increase of 0.07% from the previous month.
The total value of shares purchased by "GCC Investors" during this period amounted to SAR 1.94 billion representing 1.65% of total buying activity, and sales of SAR 1.79 billion representing 1.52% of total selling activity. Total ownership of "GCC Investors" stood at 2.56% of total market capitalization as of 28 April 2016, representing a decrease of 0.01% from the previous month.
The total value of shares purchased by "Foreign Investors" during this period amounted to SAR 3.74 billion representing 3.18% of total buying activity, and sales of SAR 3.44 billion representing 2.92% of total selling activity. Total ownership of "Foreign Investors" stood at 4.36% of total market capitalization as of 28 April 2016, representing a decrease of 0.07% from the previous month.
To view the detailed Monthly Stock Market Ownership and Trading Activity Report please Click Here
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The puzzle that just isn't. (arXiv:1604.08895v1 [q-fin.EC])
In his stimulating article on the reasons for two puzzling observations about the behaviour of interest rates, exchange rates and the rate of inflation, Charles Engel (2016) puts forward an explanation that rests on the concept of a non-pecuniary liquidity return on assets. Albeit intriguing the analysis struggles to account for a number of facts which are familiar to participants of the foreign exchange and bond markets. Reconciling these facts in conjunction with a careful dissection of the "puzzle" to begin with, shows that the forward premium puzzle just does not exist, at least not in its canonical form.
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A new structural stochastic volatility model of asset pricing and its stylized facts. (arXiv:1604.08824v1 [q-fin.EC])
Building on a prominent agent-based model, we present a new structural stochastic volatility asset pricing model of fundamentalists vs. chartists where the prices are determined based on excess demand. Specifically, this allows for modelling stochastic interactions between agents, based on a herding process corrected by a price misalignment, and incorporating strong noise components in the agents' demand. The model's parameters are estimated using the method of simulated moments, where the moments reflect the basic properties of the daily returns of a stock market index. In addition, for the first time we apply a (parametric) bootstrap method in a setting where the switching between strategies is modelled using a discrete choice approach. As we demonstrate, the resulting dynamics replicate a rich set of the stylized facts of the daily financial data including: heavy tails, volatility clustering, long memory in absolute returns, as well as the absence of autocorrelation in raw returns, volatility-volume correlations, aggregate Gaussianity, concave price impact and extreme price events.
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Pricing Bermudan options under local L\'evy models with default. (arXiv:1604.08735v1 [q-fin.PR])
We consider a defaultable asset whose risk-neutral pricing dynamics are described by an exponential L\'evy-type martingale. This class of models allows for a local volatility, local default intensity and a locally dependent L\'evy measure. We present a pricing method for Bermudan options based on an analytical approximation of the characteristic function combined with the COS method. Due to a special form of the obtained characteristic function the price can be computed using a Fast Fourier Transform-based algorithm resulting in a fast and accurate calculation. The Greeks can be computed at almost no additional computational cost. Error bounds for the approximation of the characteristic function as well as for the total option price are given.
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An Explicit Formula for Likelihood Function for Gaussian Vector Autoregressive Moving-Average Model Conditioned on Initial Observables with Application to Model Calibration. (arXiv:1604.08677v1 [q-fin.ST])
We derive an explicit formula for likelihood function for Gaussian VARMA model conditioned on initial observables where the moving-average (MA) coefficients are scalar. For fixed MA coefficients the likelihood function is optimized in the autoregressive variables $\Phi$'s by a closed form formula generalizing regression calculation of the VAR model with the introduction of an inner product defined by MA coefficients. We show the assumption of scalar MA coefficients is not restrictive and this formulation of the VARMA model shares many nice features of VAR and MA model. The gradient and Hessian could be computed analytically. The likelihood function is preserved under the root invertion maps of the MA coefficients. We discuss constraints on the gradient of the likelihood function with moving average unit roots. With the help of FFT the likelihood function could be computed in $O((kp+1)^2T +ckT\log(T))$ time. Numerical calibration is required for the scalar MA variables only. The approach can be generalized to include additional drifts as well as integrated components. We discuss a relationship with the Borodin-Okounkov formula and the case of infinite MA components.
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Monetizing Innovation How Smart Companies Design the Product Around the Price
 |  | Monetizing Innovation: How Smart Companies Design the Product around the Price explores what happens when companies stop guessing at whether an innovation will succeed and put the customer’s willingness to pay at the very core of product design. |
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Tokyo Commodity Exchange: Final Settlement Price Of Dubai Crude Oil For April 2016 Contract
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Tokyo Stock Exchange: Approval Of Initial listing (ETF): Daiwa ETF MSCI Japan Human and Physical Investment Index (Daiwa Asset Management)
Today, Tokyo Stock Exchange, Inc. (TSE) approved the listing of new ETF managed by “Daiwa Asset Management Co., Ltd.”. The ETF will be listed on Thursday, May 19, 2016.
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Acting CEO UAE's Securities and Commodities Authority Dr. Al Zaabi Meets With Nasdaqâs Executive Vice President To Discuss Cooperation In The Fields Of Training, Technical Support And Electronic Control
As part of the efforts of the Securities and Commodities Authority (SCA) to upgrade and develop the performance of financial markets, through the exchange of expertise with developed financial markets, HE Dr. Obaid Al Zaabi, Acting CEO of the SCA, received Mr. Edward Knight, Executive Vice President and General Counsel of Nasdaq, and Faycal Belyazid, Senior Sales Executive of Nasdaq’s Market Technology - Middle East and Africa. The two parties discussed ways to enhance mutual cooperation aiming to develop and exchange experiences in the financial services industry between the UAE financial markets and Nasdaq.
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Japan Exchange Group Trading Overview In April 2016
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UAE's Securities And Commodities Authority Declares Thursday, May 05, Holiday For Financial Markets To Mark Al Israa Wal Miraj
Pursuant to statement no. (12) of 2016 issued by the Federal Authority for Government Human Resources (FAHR) on Al Israa wal Miraj holiday for UAE ministries and federal bodies, the Securities and Commodities Authority (SCA) declares Thursday, May 05, a public holiday for financial markets, after having conferred with the management of the Abu Dhabi Securities Exchange (ADX) and the Dubai Financial Market (DFM). Trading will resume Sunday, May 08. The Dubai Gold and Commodities Exchange (DGCX), however, will decide when to close and open, according to public interest requirements.
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