OF MARKET INFRASTRUCTURE
THE RISE OF THE MACHINES
15TH - 16TH APRIL 2019
IN ASSOCIATION WITH
Before the machines, markets were a place that humans with roughly equal information and reflexes set the prices of financial assets by buying and selling. After the machines took over, markets became dominated, in terms of volume, liquidity and pricing, by machines, artificial intelligence (AI), and algorithms that operate in time frames of a millionth of a second. We will explore these impacts and future developments of technology in today’s and tomorrow’s capital markets.
ABOUT THE TRAINING COURSE
Not only are today’s markets something the human traders of a generation ago would fail to recognise, but they are no longer a place where human actions of any sort have much of a remaining role. The digitalization of the workplace has provided organisations with a brand new set of options for getting work completed more efficiently. It is time to move beyond alarmist rhetoric about market automation and to now consider how human-machine collaboration can deliver a higher level of operational productivity. The question to ask is not how many finance jobs will be replaced by artificial intelligence (AI) and robotics, but how work can be reconfigured in order to achieve the optimal integration of talent and machines. From liquidity improvements, to big data, settlement technology, and blockchain – we are now in a new wave of automation, AI in the capital markets is here to stay.
ADDRESSING DELEGATE CHALLENGES
CHALLENGE NO. 1: “I don’t understand what is driving the market?”
Delegates will come away from the training course with a more thorough understanding of, not only market structure, but also the factors that are affecting the market, and what to expect in the future in terms of market conditions, future regulation, and other important factors affecting the global financial ecosystem.
CHALLENGE NO. 2: “I don’t understand new technologies such as blockchain or cryptocurrency.”
Delegates will be able to obtain a deep and profound understanding of the technology behind the cryptocurrency’s blockchain, applications, as well as the current dynamics of the cryptocurrency trading environment. Delegates will also learn about what to expect in the future for this revolutionary technology.
CHALLENGE NO. 3: “I find it difficult to see what is happening with the future of regulation, and how Brexit is going to impact my life?”
Delegates will not only be able to better understand market structure conditions, but they will also be able to understand market risk conditions that will affect the financial markets going forward. Delegates will be able to take away a profound understanding of the future of regulation, what it means to them in their business, and what to expect in terms of market conditions because of these changes.
Attendees will gain a profound understanding of what lies ahead in the rapidly changing capital markets and the rapidly evolving capital market structure.
Attendees will comprehensively understand how new technologies are impacting markets and what financial technologies are set to next impact markets.
Attendees will be able to explore relevant risk factors affecting market participants, and will be able to understand how to diagnose and hedge these risk factors in volatile markets.
Attendees will be better equipped to understand the unique dynamics of the markets. How various factors push and pull, affecting other areas of the market, and how regulation, collateral management, and HFT have an impact on market conditions.
Attendees will address the challenge of today’s market as well as what challenges are on the horizon.
MODULE 1: MODERN MARKET STRUCTURE LOOKING BEYOND 2020: THE RISE OF ALTERNATIVE TECHNOLOGY, MARKETPLACES, AND PRODUCTS SUCH AS EXCHANGE TRADED DERIVATIVES, AND CRYPTO CURRENCIES
• A Review of developments in Exchanges, Clearing houses, and Collateral.
• An Analysis of Exchange traded and over-the-counter (OTC) derivatives landscape.
• A Review of Crypto currencies dynamics, offerings, and the eco system.
• Understanding Blockchain, AI, and machine learning in trading, finance, and operations.
MODULE 2: REGULATIONS, DONALD TRUMP, BREXIT, AND RED FLAG RISK FACTORS – STUDYING IMPACTS ON CAPITAL MARKETS
• A Review of the revised Markets in Financial Instruments Directive (MiFID II): One of the most seismic regulatory shifts in history affecting everything from investment research to dark pools.
• A discussion of who will be Bitcoin’s ultimate regulator and the future state of Crypto currency trading regulation.
• The Global Legal Entity Identifier (LEI) Initiative – The LEI is part of a much bigger market structure solution.
• Discussing Deregulation: A lose-lose game that would have serious consequences for the stability of the world financial system.
MODULE 3: COLLATERAL TIDAL WAVE: COLLATERAL USAGE TODAY, TOMORROW AND IMPEDING SHORTFALL
• Account segregation history: Discussing MF Global, LSOC, CFTC, CME, and John Corzine.
• Instant Payments, a discussion of Ripple & MoneyGram’s XRP
• What can China do to help the global collateral exchange?
• Exploring the impact and rule-set for non-cleared margin regulation.
MODULE 4: CRYPTO-CURRENCY EVOLUTION, USE CASES, AND EXPLORING HYPE V. SUSTAINABILITY
• A review of crypto-currency trading, and the regulatory response.
• A discussion of Ethereum and SMART contracts: The winning model for settlement in the future.
• Industry Case Study: Omega One, a leading crypto-asset agency brokerage for asset managers and institutional investors.
• Industry Case Study: Silk Road & Dread Pirate, the complete story and how the illegal marketplace changed market and trading history.
MODULE 5: EXCHANGES, CLEARING HOUSES, MARKET SHARE, INDUSTRY BATTLES AND FUTURE WINNERS
• The Future of Libor and ISDA x: A Review of the LIBOR manipulation scandal and how the rate will be assembled in the future.
• Industry Case Study: Quantile Technologies Ltd and
compression – reducing risk in the $600 trillion derivatives market.
• Industry Case Study: Open-door – tackling the illiquidity problem with bond trading.
• Industry Case Study: BitMEX – a cryptocurrency exchange changing market structure forever.
MODULE 6: HFT, CONNECTIVITY, & AI IN TRADING - HAVE WE HIT A WALL? HOW COMPETITORS HAVE REACHED CRITICAL MASS
• Combating HFT? IEX launches HFT proof exchange, reviewing the offering and why it works and why it does not matter anymore.
• Industry Case Study: Chicago Stock Exchange: The new hub for China stock trading?
• Industry Case Study: No more traders? How market leader JPMorgan is automating almost their entire worldwide trading business – eventually.
• Industry Case Study: Hedge Fund Renaissance and AI – the greatest success story in the markets. How Renaissance’s Medallion Fund Became Finance’s Blackest Box.
MODULE 7: THE FUTURE OF FINANCIAL CRIMES AND PROSECUTION, WHAT IS FAIR GAME?
• Lessons from the world’s largest Cryptocurrency Heists.
• Industry Case Study: Snitching on Wall Street. Informant Double-Crossed the Federal Bureau of Investigation.
• The CFTC and DRW Holdings Inc.: Trading manipulation lawsuit and “Banging-the-Close”.
• Is the VIX being Gamed? VIX trading and ongoing manipulation in the volatility index market.
MODULE 8: BLOCKCHAIN AND OTHER GAME CHANGING FINANCIAL TECHNOLOGY (FINTECH) OFFERINGS
• Blockchain Live Review: ASX Ltd. processing equity transactions powered by Blockchain and Digital Asset Holdings.
• Your sandbox or mine? A review of current offerings and initiatives from Axoni, Digital Asset Holdings, Symbiont, R3 and Chain.
• The Ethereum Blockchain and zero-knowledge proof – Adding a level of privacy encryption.
• Industry Case Study: AirSwap – The world’s first decentralized exchange utilising Blockchain technology.
Sol Steinberg is an OTC markets subject matter expert and specializes in risk management, OTC derivatives, market structure, collateral, trade lifecycle, valuation, financial technology systems, strategic development, and monetization. Sol is the founding principle of his firm, OTC partners. OTC partners is a boutique value add firm that specialises in research, content, and development. Before starting OTC Partners Sol was a senior executive at the world’s leading clearing house LCH.Clearnet. Sol also spent nine years on the buy side at Citi, performing product development, risk management, and valuation for the OTC markets. Sol has a wide-ranging network of asset managers, analytic providers, execution venues, regulatory, and government contacts. He used his eco system to successfully commercialise analytics, data, and other non commercialised intellectual property and has had significant monetization success. He brought to market several initiatives, including institutional and commercial risk engines such as SMART tool, Risk Explorer, Global Market Risk System for Citi, the largest VaR engine in the world from 2004 to 2006, as well as developing CCP2 – a derivative education and certification programme for leading consultancies. Sol also contributed to the OTC industry’s clearing and default management policies for the cleared OTC swap markets, as well as contributed to industry standard risk analytics in times of low market rates.
AWARDS AND HONOURS
Waters Magazine’s Award “Best Risk Analytics Initiative 2012”
Waters Magazine’s Award “Best Risk Analytics Initiative (Sell Side) 2013”
FTF’s award for “Most cutting edge risk contribution 2013” for developing the SMART Risk Analytics Tool.
Global Nominee in 2012 for “Best Practices in Global Financial Risk Management” from the Professional Risk Managers International Association (PRMIA).
WHO SHOULD ATTEND?
From Banks, Hedge funds, Exchanges, Brokers, FinTech firms, and regulators:
• Collateral functions.
• Fixed Income / Rates / Credit Trading Desks.
• Market Risk.
• OTC Derivatives.
• Product Control.