Ben St. Clair

Interest rate derivatives trading fell by more than half of typical volumes last Friday (July 19) after global tech outages caused by a faulty update from cybersecurity firm CrowdStrike disrupted markets and two interdealer broker pricing feeds went offline.

A study of mutual and exchange-traded funds’ foreign exchange forwards data has shown remarkably consistent trading behaviour among some of the largest users of the instrument, allowing hundreds of billions of dollars of trade executions from the likes of Vanguard and Pimco to be predicted almost to the day.

Single-name credit-default swap (CDS) volumes may have jumped to a nine-year high last quarter, but the market remains a shadow of its former self and continues to show signs of illiquidity.

The largest US mutual and exchange-traded fund managers are increasingly dedicating less of their foreign exchange forwards books to their top counterparty, with six of the largest 10 FX forward-holding managers giving their main dealer a smaller proportion of volume in each of the past three years.

This year, interest rate futures traders have had to contend with a situation unprecedented in many of their careers: significant uncertainty over cheapest-to-deliver (CTD) bonds.

In the immediate aftermath of Russia’s invasion of Ukraine, the ensuing sanctions and illiquidity posed challenges to conventional methods of pricing securities. Foremost among these challenges were the struggles faced by mutual funds in valuing their holdings of Russian government debt.

At first glance, the Growth Portfolio mutual fund offered by Morgan Stanley Investment Management seems fairly straightforward, holding a selection of tech-heavy US stocks like Cloudflare, Doordash and Snowflake. But over the past five years, the nearly $10 billion-asset fund has also spent $150 million on something seemingly unrelated – a string of options to buy US dollar against the renminbi, which would only pay off if the Chinese currency collapsed in value.

Only a handful of US mutual funds would report large positions under proposed rules for single-name credit default swaps, with PGIM and Pimco needing to report the most, an analysis of regulatory filings by Risk.net shows.

Single-name credit default swap volumes are at highs not seen for several years, boosted by profit-taking and pandemic-related central bank involvement in markets – juicing interest from traders and a broader cross-section of investors.

As the number of credit default swap (CDS) auctions was poised to reach near-record highs last year, US mutual funds were sitting on the wrong side of swap positions for many soon-to-be-defaulted entities. In some cases, funds reversed their sold positions ahead of the default – for others it’s less clear.

As some investors look for safety, one haven is being ignored—gold. The precious metal has historically been used as a safe place to invest in times of economic and political stress. But even as investors fret about the prospect of trade war, gold has fallen by nearly 4% this year. In the past month, over $2.1 billion has flowed out of the five largest exchange-traded funds that track the precious metal, according to FactSet data.

Copper prices slipped to a six-month low Thursday amid jitters about economic growth in China, the world’s dominant consumer of the metal. Contracts for July fell 1% to $2.9535 a pound at the Comex division of the New York Mercantile Exchange, closing at the lowest point since December 7.

Last month, a Pew Research Center report grabbed a lot of attention for saying that, for the first time since 1880, young adults ages 18 to 34 are more likely to live with a parent than in any other arrangement. But a new analysis by Pew shows that the trend isn't being driven, primarily at least, by a common stereotype — that of the recent college grad who hasn't found their first job.

Jared Kushner’s habit of not properly filling out paperwork began years before his tenure at the White House.

The Bronx has become a destination for investors seeking high returns – not only in new development, which is, by any measure booming, but also in the borough’s existing apartment building stock.

Nemesis Dipré, FCRH ’18, has commuted to Rose Hill from her parents’ home in University Heights since her freshman year. Accustomed to being among the racial majority in high school, Dipré, who identifies as Hispanic, said that her transition to Fordham was an adjustment process.