Oct 14, 2015

The Watch List for October 14 | Treasury Flash Crash One Year Later

In this video series Jim Jockle, CMO of Numerix tackles the top news items of the week impacting the state of the global financial markets.

In this October 14th edition Jim interviews Kevin McPartland, Head of Market Structure and Technology at Greenwich Associates. They discuss the first anniversary of the Treasury flash crash, and specifically what has changed - in terms of market participants, regulation and new initiatives for electronic bond trading platforms.

They also discuss fundamental changes in terms of banks moving away from making markets. Under the Volker Rule, while US treasuries are exempt treasury futures, interest rate futures, and swaps are not. Considered critical hedging tools in making markets with treasuries, this has acted as a catalyst in terms of banks moving away from market making. Lastly, Jim and Kevin discuss potential repercussions of the ongoing low rate environment.

For the latest on these issues read the executive summary of Greenwich Associates' latest research:  U.S. Treasury Trading: The Intersection of Liquidity Makers and Takers

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