Financial Footbal #11

5 comments / July 15, 2014

A few days without a major football match, starting to miss it. But there’s good news, as end of August the 11th edition of the Financial Football Tournament will be held in Abcoude. Save the date, August 30th.

Everything will be smoothly organized by Ferry Boekholt as usual. BBQ, kindergarten, good weather- Bennington takes care of it.

Guess the German teams are going for the double. Last year the cup was won by Eurex. Understandingly, they are in a winning mood. Although Neuer was lucky to stay on the pitch.

Optiver. Big in Japan.

104 comments / July 1, 2014

Last year has been a profitable year for Optiver. CEO Paul Hilgers, who took over the helm six months ago, reported a profit of € 174 million over 2013. That’s 23% more compared with previous year.

Trading revenue was up 26% to an impressive € 466 million. The expenses were up a few million as it hired more employees for IT, back office trade processing and administration

Outperforming rival IMC

Once again Optiver earned more than long term rival IMC, which saw a profit of €127 million and trading revenue of €403 million in the same period.

Big in Japan

Unfortunately there’s no annual report available just yet. Company decided to release the figures to a few newspapers before releasing the full report. Main comments in the FD was more than half of the profits come from outside the European Union.

Particularly Hong Kong and Japan have seen very good trading conditions. Due to the aggressive monetary policy of Shinzo Abe, the trading volumes in Japan doubled. Volumes in Europe and the US have been flat.

Company is about to expand in the US in other asset classes, but targets organic growth without acquisitions. This in contrast to IMC, which bought Goldman Sachs’s post on the floor of the New York Stock Exchange.

No insurance for Den Drijver and Kroon

50 comments / June 23, 2014

The firm Van der Moolen went bankrupt half a decade ago, but it isn’t over yet for Richard den Drijver and crime Hans Kroon. Several investors are still trying to recover some of their losses. Usually, the board members are protected by a company insurance policy. After all, nobody wants to be at the helm when risking massive claims.

And the claims are substantial. Den Drijver and Kroon are facing a claim amounting some 130 million.

Here comes the good part. As court decided the fall of Van Der Moolen was due maladministration, insurer AIG walked and left Den Drijver and Kroon on their own. For starters, they have to pay their own lawyers. Sidney Berendsen, lawyer for Loyens & Loeff, is defending them. But he isn’t into charity, and the bill outstanding is almost a million.

In the case between AIG and Den Drijver/Kroon, court decided AIG has right to walk away. Both gentlemen may have ruined shareholders but are still living in several expensive apartments. Hell, they have been listed on the Quote 500 list in 2009 edition (nl).

Maybe it’s wise to pay your own lawyer. Especially when he’ll defend you against a 130 mio claim. Maybe he’ll eventually broker a settlement for you, negotiating the claim to a more modest amount. Say, 13 million each. Negotiations are ongoing, FD reports.

Euronext IPO at €20, low end

17 comments / June 19, 2014

Euronext shares will float today after the IPO has been priced towards the low end of the range. It’s also the third friday of the month with a lot of futures and options expiring. A lot, but also a lot less compared with earlier years.

The shrinking turnover is one painful development for the exchange. The other one is the fierce competition from especially Chi-X (in stocks) and TOM (in options). Could be a coincidence, but most retail order flow will move to Chi-X this week.

TOM announced this week Chi-X is connected to their Smart Order Routing (SOR). In general the market at Chi-x has the same spread as Euronext, but trading is a lot cheaper.

Lower costs of trading for the banks and brokers, that is. Retail investors in Europe won’t benefit from lower fees. Especially TOM is taking great care of their own shareholders. Clients of brokers such as Binck and Alex won’t save a penny.

Euronext. Not much hyped IPO, and a lot of room for cost cutting. They could run the business with less than a third of the current 850 employees. Selling some magnificent real estate is another possibility. However, regulatory / national issues will halt most progress. Without reading too much in the prospectus, Amsterdamtrader starts covering of ENX with a HOLD rating.

Sprinters on NL20, on Euronext

21 comments / June 16, 2014

Last month TOM released their own Dutch market index NL20. Nice for the regular newspapers who have another press release to copy-paste, and some goodies for the rest of the market. Orange sunglasses.

Truth is nobody cares about any new market index, as long as it can’t be traded. See for another irrelevant index the Telegraaf’s AEX DFT Oranje Index (nl). TOM isn’t in the market for launching another fake paper index.

TOM’s index NL20 traded on Euronext

ING will start today with Sprinters based on the NL20. Options and futures on the index will follow shortly – TOM is committed to make this work. Talks with liquidity providers are currently ongoing.

Sprinters are leveraged structured products, also known as Turbo’s (ABN) or Speeders (Citi). Here’s the catch : the new Sprinters on the NL20 index will be traded on Euronext. That must hurt. The attack on their profit center “index information” will be launched on their own systems.

No, this NL20 Sprinter won’t have a material impact on Euronext’s profitability. Not yet, at least. The index licenses will be doing fine this year. However, the timing is aggressive, with Euronext’s IPO coming next week.

No lower prices for retail investors

I always fancy the underdog, and support price competition. However, I haven’t noticed retail investors paying less fee than before at Binck/Alex. Option traders still save more money at a broker not connected to TOM.

Outperforming rival IMC

Big in Japan

TOM’s index NL20 traded on Euronext

No lower prices for retail investors

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