...Contents HFT 2 Market Microstructure Review 4 Types of Equity Markets 4 Dark Pool 5 News 5 HFT High frequency trading – grown to account for 20-30% of the volume on the exchanges. Low – latency hardware strategically placed as close as possible to exchange data centers. HFT – defined by trading where speed matters. Subset of HFT by TMX program – ELP (electronic liquidity provider) Today, typical high frequency systems are interpreting and reacting to market data in microseconds. High Frequency Group | Specific Strategy | Market making | *passive rebate arbitrage, exchanges provide incentives to liquidity providers by paying for passive order flowHigh frequency trading strategies that involves placing an order to sell (or offer) or buy a limit order (or bid) in order to earn a bid-ask spread. | | Ticker tape trading – by observing flow of quotes, high frequency machines are able to extract information that has not yet crossed the news screens. Since all quote and volume information is public, fully complaint with regulatory laws | Latency Arbitrage | Interlisted arbitrage – strategy that attempts to buy and sell the same security btw. domiciles. Eg. buying Potash corp in Canada and selling it in the U.S.Intra-listed arbitrage – strategy that attempts to buy and sell the same security btw. domestic marketplaces. Eg. Buying POT on BATS and selling it on NYSE | Information Arbitrage | Index arbitrage – strategy that attempts to profit from mispricing...
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...INTRODUCTION TO CAPITAL MARKETS What is investment banking? Investment banks act as intermediaries in capital markets, helping the matching of sellers and buyers of various securities and advising institutional investors, government and companies on their investment strategies, on their financing needs (helping them to raise money) and their acquisitions. Two main areas: (1) Securities or capital markets divisions: trading in the equity, fixed income ,FX and commodities markets and advising and intermediating for institutional investors in those markets. (2) Corporate Finance and public finance (often referred to as investment banking) advising corporations and governments on their financing needs, including the underwriting of securities, on their merger and acquisition activities, or on their restructuring. Securities and capital markets divisions Clients are usually * Institutional investors, corporates or public entities, not private clients; * Mutual funds asset managers; * Pension Fund asset managers; * The insurance companies; * Private Banks; * Hedge Funds; * The treasury departments of large banks or large companies. Capital markets divisions * Equity division: equity research, equity sales, equity trading on cash, flow derivatives and structured products * FIRC or FICC (Fixed Income, currencies and derivatives): * Fixed income cash products, interest and credit derivatives...
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...D Disrupting Wall Street High Frequency Trading Case I, Group A6 13.10.2015 Case I: High Frequency Trading Group A6 1 1. Describe the current market structure and trends of US equities trading. The current US equity trading market structure can be evaluated from different perspectives. In light of the actual case study the focus of this brief analysis lies on the way how trades were respectively are actually pursued. Originally - until the late 1970s / early 1980s – trading took place on a physical trading floor. Brokers among floor traders and runners once populated the physical exchanges (Siddaiah, 2009). Nowadays the physical trading floors are not relevant anymore and solely exist as part of an historical brand identity (Ivey, 2014). However, even those traders still present at a physical trading floor, e.g. at the New York Stock Exchange (NYSE), rely on electronic support: quote filled computer screens provide information while electronic handhelds are used to eventually execute trades. Since the 1980s electronic trading constantly gained importance. Today virtually 100% of all trades are done electronically or at least with a remarkable amount of computer support. Special servers not only match ‘buy’ and ‘sell’ orders within fractions of a second but are also capable of confirming thousands of individual orders per second. Based on execution speed and power one can rank different electronic trading systems as follows1: (1) Direct Market...
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...FIN 3103 FINANCIAL MARKETS AND INSTITUTIONS– SECTION 1A AN INTRODUCTION TO THE ASIAN EQUITY MARKET & ITS EXCHANGES SAMUEL TOW WEE YAP (A0102724U) LIEW KUANG CHEN JOEL (A0004624U) ANG CHUAN HWEN JEREMY (A0080928X) LIAW YIH HANG (A0091535E) WU GUIYAN (A0100395N) ZHAO CHUANYI (A0105563L) Contents 1. Introduction ..................................................................................................................................................................................................... 4 2. Objectives of the Stock Market ................................................................................................................................................................. 4 2.1 Capital Formation ......................................................................................................................................................................................... 4 2.2 Connecting Traders ...................................................................................................................................................................................... 4 2.3 Security............................................................................................................................................................................................................. 4 2.4 Economic Indicator ...................................................................................................
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...INVESTMENT BANKING RECRUITING ASSOCIATE INTERVIEW GUIDE Created by modern guild Industry Experts & Career Coaches, Tara Kurian & Aaron Kurian Spring 2013 This document has been created by modern guild Acceleration Finance Career Coaches & Industry Experts that have gone through the rigorous associate investment banking recruiting process. The material is meant to provide assistance and preparation for modern guild protégés who are about to go through the process. Table of Contents RECRUITING OVERVIEW ............................................................................................................................... 2 WHAT YOU NEED TO KNOW BEFORE YOU START ........................................................................................ 4 THE GROUP ............................................................................................................................................... 4 YOUR PITCH ....................................................................................................................................
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...For exclusive use at ESADE, 2015 W14540 DISRUPTING WALL STREET: HIGH FREQUENCY TRADING 1 Brad Evans wrote this case under the supervision of Professor Derrick Neufeld solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. This publication may not be transmitted, photocopied, digitized or otherwise reproduced in any form or by any means without the permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) cases@ivey.ca; www.iveycases.com. Copyright © 2014, Richard Ivey School of Business Foundation Version: 2014-10-29 The day after the public release of the book Flash Boys, on April 1, 2014 CNBC invited Michael Lewis (New York Times best-selling author of Moneyball and The Blind Side), 2 along with Brad Katsuyama (chief executive officer [CEO] and co-founder of the new Investors Exchange or IEX) and Bill O’Brien (president of BATS Global Markets, Inc.), to talk about high frequency trading (HFT). The ensuing debate was explosive. O’Brien opened the interview with the following charge,...
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...Current financial crisis Economic growth involves metamorphosis of the financial system. Forms of banks and bank money change. These changes, if not addressed, leave the banking system vulnerable to crisis. There is no greater challenge in economics than to understand and prevent financial crises. The financial crisis of 2007-2008 provides the opportunity to reassess our understanding of crises. All financial crises are at root bank runs, because bank debt—of all forms—is vulnerable to sudden exit by bank debt holders. The current crisis raises issues for crisis theory. And, empirically, studying crises is challenging because of small samples and incomplete data. *Written as a contribution for Trade, Globalization and Development: Essays in Honor of Kalyan Sanyal, edited by Sugata Marjit and Rajat Acharya (Springer Verlag; forthcoming). Some of this essay draws from material in my book Misunderstanding Financial Crises (Oxford University Press; forthcoming November 2012). I worked at AIG Financial Products as a consultant from 1996-2008. I thank Doug Diamond, Bengt Holmström, Arvind Krishnamurthy, and Guillermo Ordoňez for comments.1 1. Introduction Economic development does not result in the elimination of financial crises. The recent financial crisis of 2007-2009 in the United States and Europe shows that market economies, however much they grow and change, are still susceptible to collapse or near-collapse from financial crisis. This is a staggering thought...
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...Meezan Bank’s Guide to Islamic Banking Meezan Bank’s Guide to Islamic Banking 1 Meezan Bank’s Guide to Islamic Banking Meezan Bank’s Guide to Islamic Banking Written by Dr. Muhammad Imran Ashraf Usmani Ph. D. Islamic Finance Assistance in translation, editing and compilation by Zeenat Zubairi DARUL-ISHAAT Urdu Bazar Karachi Ph: 021-2631861 2 Meezan Bank’s Guide to Islamic Banking Copyright Regd. No. Publications Rights Reserved with DARUL - ISHAAT KARACHI FIRST EDITION 2002 PRINTED AT ILMI GRAPHICS PUBLISHER DARUL - ISHAAT URDU BAZAR KARACHI-1 PAKISTAN. E-mail : ishaat@digicom.net.pk Ph: 021-2631861 AVAILABLE AT IDARATUL MA’ARIF, DARUL ULOOM, KORANGI, KARACHI DISTRIBUTOR IN U.K. AZHAR ACADEMY LTD., at continenta (London) Ltd.. Cooks Road, London E-15 2pw This copy cannot be sold in the U.K., unless sold by or authorised by the 3 Meezan Bank’s Guide to Islamic Banking TABLE OF CONTENTS Preface 7 SECTION I INTRODUCTION TO ISLAMIC ECONOMIC SYSTEM 1 2 3 Chapter 1: Chapter 2: Chapter 3: The Islamic Economic System Factors of production in Islam The objectives of the distribution of wealth in Islam 11 19 29 SECTION II RIBA, ITS PROHIBITION & CLASSIFICATIONS 4 5 6 7 8 Chapter 4: Chapter 5: Chapter 6: Chapter 7: Chapter 8: Riba in the Qur'an Riba in Hadith Riba and its types Commercial interest and usury Simple and compound interest 34 36 42 53 62 SECTION III ISLAMIC CONTRACT 9 10 11 12 Chapter 9: Chapter 10: Chapter...
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...Bernie Madoff: The Makings of a Ponzi Scheme Brent Casebolt Keller Graduate School of Management Abstract This paper explores seven published articles that report on the story of Bernard Madoff. These articles were the results of research conducted on the internet and include well known publications and authors throughout the United States. Some articles paint a picture of the timeline that brought Bernie Madoff to his ultimate demise. From humble beginnings to Federal prisoner in North Carolina, the story is full of interesting facts and unbelievable occurrences. Other articles bring to life the sad story of other players involved in the Ponzi scheme. While others lay out in great detail the failings of our own government to put Bernie Madoff away much sooner than he was. Finally, this paper will explore the role of digital evidence in this Ponzi scheme and the simplicity of computer hardware and software involved. Bernie Madoff: The Makings of a Ponzi Scheme Bernie Madoff has been one of the most interesting and controversial figures in all of American financial industry history. In this paper, I will take you on a journey from his early childhood to his current status as a Federal prisoner in North Carolina. I will discuss all of the major players involved in the Ponzi scheme, the SEC’s failure to catch him on numerous occasions, and the digital evidence that he did or did not leave behind during his life of crime. After examining all of the above, I...
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...IT and International Real-Time Media: Amplifier for a Crisis or Instrument of Rational Decision-Taking Narelle Gomes, Christian Piechorowski 09.01.2014 Table of contents: 1.1 Information technology’s impact in the development of the stock exchange 1.2 Algorithmic trading 1.3 High frequency trading 1.4 High frequency; trading beneficial or harmful for the economy? 1.5 Final Remarks 2.1 The Influential Role of Mass Media - The Pervasiveness of the information disseminated on the people 2.2 Financial Crisis- A media spectacle? 2.3 The mishaps of European Media during the current Euro crisis 2.3.1 The alternative view of the media; Citizens mistrust towards the media 2.3.2 The wavering power of mainstream amidst its pervasiveness 3. Conclusion Introduction Problem Description: The world financial crisis started in the US with the burst of the housing bubble in 2007. However, it was not just limited to the US border, but it rapidly spread all over the world. Consequently, many banks went bankrupt and some countries were even pushed into a financial downturn. Target of Study: This essay will not provide a general outlook on the financial crisis but instead examines the impact of the Real time media and IT on this economic crisis of historic scale. How important...
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...A Tale of Two Londons Who really lives at One Hyde Park, called the world’s most expensive residential building? Its mostly absentee owners, hiding behind offshore corporations based in tax havens, provide a portrait of the new global super-wealthy. BY NICHOLAS SHAXSON Up until the 18th century, Knightsbridge, which borders genteel Kensington, was a lawless zone roamed by predatory monks and assorted cutthroats. It didn’t come of age until the Victorian building boom, which left a charming legacy of mostly large and beautiful Victorian houses, with their trademark white or cream paint, black iron railings, high ceilings, and short, elegant stone steps up to the front door. This will not be the impression a visitor now gets as he emerges from the Knightsbridge subway station’s south exit. He will be met by four hulking joined-up towers of glass, metal, and concrete, sandwiched between the Victorian splendors of the Mandarin Oriental Hotel, to the east, and a pretty five-story residential block, to the west. This is One Hyde Park, which its developers insist is the world’s most exclusive address and the most expensive residential development ever built anywhere on earth. With apartments selling for up to $214 million, the building began to smash world per-square-foot price records when sales opened, in 2007. After quickly shrugging off the global financial crisis the complex has come to embody the central-London real-estate market, where, as high-end property consultant...
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...Co-Creating Our Future on Planet Earth Creating Unity from our human diversity. Skip to content * Home * About * Last 2000 Posts in Order ← Civil war up, humanism down: Pepe Escobar, by Pepe Escobar The Oracle Report, Monday, April 13, 2015 → :) :) :) Iceland Stuns Banks: Plans To Take Back The Power To Create Money Posted on April 13, 2015 by Jean By Raúl Ilargi Meijer Zero Hedge April 1, 2015 Submitted by Raul Ilargi Meijer via The Automatic Earth blog, Who knew that the revolution would start with those radical Icelanders? It does, though. One Frosti Sigurjonsson, a lawmaker from the ruling Progress Party, issued a report today that suggests taking the power to create money away from commercial banks, and hand it to the central bank and, ultimately, Parliament. Can’t see commercial banks in the western world be too happy with this. They must be contemplating wiping the island nation off the map. If accepted in the Iceland parliament , the plan would change the game in a very radical way. It would be successful too, because there is no bigger scourge on our economies than commercial banks creating money and then securitizing and selling off the loans they just created the money (credit) with. Everyone, with the possible exception of Paul Krugman, understands why this is a very sound idea. Agence France Presse reports: Iceland Looks At Ending Boom And Bust With Radical Money Plan Iceland’s government is considering a revolutionary monetary proposal...
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...Co-Creating Our Future on Planet Earth Creating Unity from our human diversity. Skip to content * Home * About * Last 2000 Posts in Order ← Civil war up, humanism down: Pepe Escobar, by Pepe Escobar The Oracle Report, Monday, April 13, 2015 → :) :) :) Iceland Stuns Banks: Plans To Take Back The Power To Create Money Posted on April 13, 2015 by Jean By Raúl Ilargi Meijer Zero Hedge April 1, 2015 Submitted by Raul Ilargi Meijer via The Automatic Earth blog, Who knew that the revolution would start with those radical Icelanders? It does, though. One Frosti Sigurjonsson, a lawmaker from the ruling Progress Party, issued a report today that suggests taking the power to create money away from commercial banks, and hand it to the central bank and, ultimately, Parliament. Can’t see commercial banks in the western world be too happy with this. They must be contemplating wiping the island nation off the map. If accepted in the Iceland parliament , the plan would change the game in a very radical way. It would be successful too, because there is no bigger scourge on our economies than commercial banks creating money and then securitizing and selling off the loans they just created the money (credit) with. Everyone, with the possible exception of Paul Krugman, understands why this is a very sound idea. Agence France Presse reports: Iceland Looks At Ending Boom And Bust With Radical Money Plan Iceland’s government is considering a revolutionary monetary proposal...
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...The Evolution of FinTech: A New Post-Crisis Paradigm? Douglas W. Arner* Jànos Barberis** Ross P. Buckley*** Abstract: “Financial technology” or “FinTech” refers to technology enabled financial solutions. FinTech is often seen today as the new marriage of financial services and information technology. However, the interlinkage of finance and technology has a long history and has evolved over three distinct eras. FinTech 1.0, from 1866 to 1987, was the first period of financial globalization supported by technological infrastructure such as transatlantic transmission cables. This was followed by FinTech 2.0, from 1987-2008, during which financial services firms increasingly digitized their processes. Since 2008 a new era of FinTech has emerged in both the developed and developing world. This era is defined not by the financial products or services delivered but by who delivers them. This latest evolution of FinTech, led by start-ups, poses challenges for regulators and market participants alike, particularly in balancing the potential benefits of innovation with the possible risks of new approaches. * Professor, Co-Director, Duke-HKU Asia America Institute in Transnational Law, and Member, Board of Management, Asian Institute of International Financial Law, Faculty of Law, University of Hong Kong. ** Senior Research Fellow, Asian Institute of International Financial Law, Faculty of Law, University of Hong Kong; and Founder, FinTech HK. *** CIFR King...
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...Security and Globalization of Multinational Businesses Located in India John Doe Professor Juan Vigil GM594 – Global and Domestic Security Management Keller Graduate School of Management June 10, 2012 2 BUSINESSES LOCATED IN INDIA Abstract This paper will outline the background of the country of India to its present day. This will include a brief discussion on how the country has become an attractive location for businesses to establish a global footprint. In doing so, there are many aspects that must be considered when setting up a business of operations within India. Business security and what can be experienced when a business finally decides to take the step. This includes aspects of local governments, local culture, and employee pool, just to name a few. Then, there is the risk associated with doing business in India once the operation is established. This can include terrorism, government conflicts, and employee concerns. While there is a large list of security concerns for a business to consider before making this type of commitment, many can be avoided or at least minimized through proper planning. I will discuss solutions that can be implemented to reduce the amount of risk associated with the security adversity when establishing a global business within India. 3 BUSINESSES LOCATED IN INDIA Business Security and Globalization of Multinational Businesses Located in India Introduction Businesses today have pushed their footprint of operation outside what...
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