Removing the barriers to an efficient market
Everyone you talk to in the market today raises the same
concerns: rising costs and increased regulation are increasing barriers across
the derivatives industry.
Everywhere you look, the barriers are rising: rising costs
means fewer new entrants into the market, increased monopoly of infrastructure
provision is raising the barrier to competition and new rules on capital are
increasing the barriers for some firms to service clients.
The derivatives industry is in a new post-crisis era.
The post-crisis era is defined by a long-term low rate environment, increased
fragmentation of liquidity and greater regulatory oversight.
But the business models that have emerged in the new era for market participants and infrastructure providers are not creating a sustainable future for the industry.
If
costs continue to rise and the number of players in the market continues to
fall, the market will dwindle to nothing.
There is a need for radical reform of the market. But to be
sustainable, this reform must not come from regulators but from the market
itself.
New models for co-operation need to be built,
re-mutualisation and democratisation must take centre stage as a new era is
built on firmer foundations than the current one.
FOW, in partnership with Object Trading, today publishes a
new whitepaper exploring how the barriers to entry have risen since the
financial crisis and asks what can be done to bring them down.
To download your free copy, click here.
Found this useful?
Take a complimentary trial of the FOW Marketing Intelligence Platform – the comprehensive source of news and analysis across the buy- and sell- side.
Gain access to:
- A single source of in-depth news, insight and analysis across Asset Management, Securities Finance, Custody, Fund Services and Derivatives
- Our interactive database, optimized to enable you to summarise data and build graphs outlining market activity
- Exclusive whitepapers, supplements and industry analysis curated and published by Futures & Options World
- Breaking news, daily and weekly alerts on the markets most relevant to you