Ken Kapner

There were a lot of reasons for the 2008 credit crisis. Some of these included poor underwriting on personal mortgage loans, investors not doing their due diligence on investments, individuals lying on their mortgage applications, and government interference, to name just a few. Another cause resulted from credit rating agencies giving Collateralized Debt Obligations (CDOs) […]

In our LIBOR Schmibor article series, I introduced SOFR (See https://www.gfmi.com/articles/libor-schmibor-whats-next-sofr-part/). SOFR issuance continues to expand including the potential use in adjustable rate mortgages. (To view a user’s guide for SOFR, go to https://www.newyorkfed.org/medialibrary/Microsites/arrc/files/2019/Users_Guide_to_SOFR.pdf.) In this article, we intend to explore futures on SOFR, specifically 3-month SOFR futures (SFR) and compare this to 3-month Eurodollar […]

Technology has changed how the capital and financial markets operate. It is easy to identify some of these changes under the banner of Fintech (Financial Technology) including electronic trading, blockchain, peer to peer lending, robo-advisors, and crowdfunding. But what about capital markets and financial training? Technology has also made extensive inroads versus the traditional classroom […]

Interest rate swaps denominated in US dollars (an agreement between two counterparties to exchange a fixed rate of interest for a floating rate of interest for a specific period of time calculated on a notional principal amount) have been in existence since the early 1980s, and most commonly have been priced historically with a floating […]

GFMI’s Newest Article The history of marijuana is one fraught with varying degrees of acceptance, illegality, utility, and recreation. As noted in GFMI’s most recent article, Marijuana Related Businesses (MRBs): High Hopes for a Fast-Growing Industry: In the United States, ten states have legalized pot for recreational use, 33 allow it for medicinal applications, and […]

In late 2017, GFMI’s President and CEO, Ken Kapner, wrote an article about the London Interbank Offered Rate (LIBOR), which is used by capital markets participants as the rate by which they would lend each other money. For a variety of reasons, including the realization that the rate was being manipulated, banks, governments, and other […]

In LIBOR SCHMIBOR: What’s Next? SOFR Part I we covered the following topics: Explanation of LIBOR Potential replacements Repurchase agreements (repos) and Tri-party Repo International benchmarks Looking ahead This article looks to: Define SOFR Discuss applications and new products Update international benchmarks Secured Overnight Financing Rate (SOFR): Definition and Features As discussed in Part I […]

The LIBOR manipulation scandal has led regulators to recommend new money market benchmarks. This article briefly reviews LIBOR and what the potential replacements will be. LIBOR LIBOR, or London Inter-Bank Offered Rate, is a money market benchmark/index, less than one-year, that has been used throughout the financial/capital markets since 1986. Some products or instruments that […]

Volatility in the stock market was subdued through 2017 as can be seen in Figure 11. Many people began to sell volatility to capture this “non-movement.” In trading parlance, it is referred to as a short vol trade. But in February of 2018, the VIX had a massive move up in volatility. From the close […]

Settlement risk has been part of the capital markets since its inception. Blockchain is the new kid on the block. Can Blockchain, sometimes referred to as Distributed Ledger Technology (DLT), help mitigate settlement risk or is it all a pipe dream? Speaking of pipes, the industry infrastructure (sometimes referred to as the “plumbing”) includes many […]

Part I of this article discussed electronic trading, the differences between algorithmic trading (AT) and high frequency trading (HFT), types of systems/platforms, exchange traded versus OTC transactions, and other considerations such as colocation. In Part II, we will address different strategies and the three main flash crashes/events. Automated Strategies Strategies are generally broken down into […]

Quite often, the media has pointed its fingers at electronic trading as the cause of various flash crashes. When delivering training on Electronic Trading, I often find that people are confused by the various terms and intricacies of this market. I thought it might be a good idea to give an overview of electronic trading […]