Boston, July 17, 2012 – A new report from Aite Group examines major global trends in futures and options trading, including currency futures and currency options, and explores issues of oversight within the CFTC markets. The report also highlights regions of growth for trading activity and reveals how well firms in CFTC markets are retaining customer deposits.
Currency futures have been the main growth story for futures trading activity worldwide, particularly since 2010. It remains to be seen whether this will continue, however, given market discontent over fund security in the United States—the most important jurisdiction for on-exchange derivatives. Traders who transact on exchanges generally do so trusting they will find transparency and efficiency, but recent market events, including PFGBest’s fund misappropriation and yet-unresolved MF Global issues, are casting a long shadow over all on-exchange activity. These controversies will surely add major regulatory and structural changes to a derivatives market already struggling with new regulations.
“Regulatory changes, summoned in 2009 by G-20 leaders and legislated into U.S. law by the Dodd-Frank Act in 2010, have yet to kick in where it counts: higher margining requirements and new transactional venue efficiency,” says Javier Paz, senior analyst with Aite Group and author of this report. “While we wait to see how this legislation impacts the market, the market must already contend with the prospect of even more regulatory change."
This 25-page Impact Note contains 16 figures and one table. Clients of Aite Group’s Wealth Management service can download the report.