Broker-Dealers Slated To Flock To Saudi Stock Exchange

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BrokerDealer.com blog update courtesy of extract from July 22 coverage from Bloomberg LP

bloomberg saudi exchange storySaudi Arabia, the world’s biggest exporter of oil and de facto leader of OPEC, is removing barriers to one of the world’s most-restricted major stock exchanges as the government pursues a $130 billion spending plan to boost non-energy industries. King Abdullah, the 90-year-old monarch, has kept the economy expanding at an average rate of 6.4 percent in the past four years even as Middle Eastern neighbors from Egypt to Iraq grappled with political turmoil.

The Tadawul surged 2.8 percent to 10,025.14 at the close, the strongest level since May 2008.

“The big sleeping giant in the region is Saudi Arabia, a well-capitalized and large market that foreigners couldn’t get access to,” Gary Dugan, the chief investment officer at National Bank of Abu Dhabi PJSC, said by phone from Abu Dhabi. “It’s exciting. It gives greater credibility to the region.”

A listing of broker-dealers in the middle-east can be found via http://brokerdealer.com/databases/broker-dealer

“If you assume a neutral allocation to the market, and assuming the 4 percent that MSCI is guiding for, we will be talking about $40 billion” of foreign inflows in Saudi Arabia’s exchange, Dubai-based Rami Sidani, who oversees the $343 million Schroders International Selection Fund, said by telephone today.

“The move by Saudi Arabia helps accelerate efforts by the Gulf into becoming a more mainstream destination for international investors,” Ryan Huang, Singapore-based market strategist at IG Ltd., said by e-mail today. “Opening up the market will be a liquidity boost for Saudi corporations.”

At least three banks, including HSBC Holdings Plc and Deutsche Bank AG, have executed test trades, three people said, asking not to be identified as the plans are private. Access for money managers outside the GCC has so far been limited to indirect routes, including equity swaps and exchange-traded funds.

The full story from Bloomberg LP can be found via this link: http://www.bloomberg.com/news/2014-07-22/saudi-to-open-up-531-billion-stock-market-to-foreigners.html

Taking a BrokerDealer to Arbitration: Is Finra Fair?

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Brokerdealer.com blog update courtesy of extract from 07.19 NY Times “Your Money” column by Tara Siegel Bernard

Image courtesy of NY Times and Robert Neubecker

Image courtesy of NY Times and Robert Neubecker

While arbitration has its share of benefits — it’s much quicker and cheaper than litigation — some securities lawyers who represent investors argue that they would get better results before a jury of their peers. But other legal experts point out that many investors wouldn’t have a chance to be heard if it weren’t for arbitration; federal securities laws, along with some states’ laws, are not always investor-friendly.

“From the investor’s perspective, the great advantage of the Finra model is that arbitrators might be able to find a remedy for investors that is not supported by law,” said Barbara Black, a professor at the University of Cincinnati College of Law.

But it doesn’t always work in investors’ favor, according to securities lawyers. And on Thursday, Finra acknowledged that its arbitration process, which has come under recent criticism, could be improved when it announced a 13-member task force to look into improving transparency, impartiality and efficiency.

So how do investors fare in arbitration right now? Last year, about 18 percent of customer cases, or 499 claims, were decided in arbitration. Customers received monetary or nonmonetary damages in 42 percent of those cases. But 77 percent of customer cases — including settlements between the parties and arbitration awards — resulted in some sort of monetary or nonmonetary relief (such as canceling a stock purchase and getting money back). Continue reading →

Finra seeks to delay nontraded REIT pricing rule

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Brokerdealer.com blog post courtesy of extract from industry publication InvestmentNews.com

investmentnewFinra is asking the Securities and Exchange Commission to give the independent broker-dealer industry much longer than it originally sought to implement rule changes that would give investors a clearer picture of what it costs to buy shares of a nontraded real estate investment trust or private placement.

The Financial Industry Regulatory Authority Inc. filed the changes and also sent a letter to the SEC on Friday that contained its final proposed rule changes to rule 2340, or rules affecting customer account statements.

In the letter, Finra associate general counsel Matthew Vitek asked the SEC to give broker-dealers and nontraded REIT sponsors 18 months to adjust to the new guidelines. Finra earlier this year had proposed giving the industry just six months after the SEC approves the rule to make those changes.

For the full story from InvestmentNews.com, please click here.

BrokerDealers and Buyside: Bitcoin Coming to A Screen Near You

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Brokerdealer.com blog update courtesy of extract from Traders Magazine, the leading publication within securities industry’s sell-side (otherwise known as the universe of registered broker-dealers). Coverage for this story provided by TradersMag writer Gregg Wirth. Visitors to this page who may wish to know more about brokerdealers and institutional investors having an interest in bitcoins are invited to search the brokerdealer.com database.

bitcoinBitcoin, the crypto-currency that initially became infamous as the tender of choice for drug traffickers and mercenaries, may be coming to a trading desk or institutional portfolio near you – and sooner than you think.

“2014 is going to be the year Bitcoin hits Wall Street,” said Barry Silbert, founder and CEO of SecondMarket, a capital-raising platform for private companies and investment funds. Indeed, there is a growing consensus in some corners of Wall Street and the buyside community that the $7.8 billion  Bitcoin industry is going to become the new, flashy darling of investors, with dedicated digital currency funds, venture capitalists and asset managers all chasing after those 12 million bitcoins currently in circulation.

“Digital currencies like Bitcoin are not going away,” Silbert explained. “And Wall Street and the regulators know this, they’ve studied how to deal with it, and now they are starting to understand its potential.” SecondMarket has gone heavy into the Bitcoin phenomenon, launching the Bitcoin Investment Trust, a $70 million open-ended trust that invests exclusively in bitcoins, as well as a dedicated desk of 10 traders who buy and sell bitcoins for the trust and other institutional clients. SecondMarket is also creating what it hopes to be the largest, best-capitalized and well-run Bitcoin exchange in the U.S., and is enlisting banks and Bitcoin-related firms to be exchange members.

“The number of inquiries and requests from finance industry professionals for us to prepare compliant investor offering documents for crypto-centric funds is certainly keeping us busy”, said Paul Azous, CEO of Prospectus.com. “We don’t see this as some type of anomaly that is connected to a short-term fad, many of the funds we are working with are forward-thinking folks who realize that blockchain applications will be expressed in nearly every business process.”

In addition to preparing investment fund offering documents, Prospectus.com helps blockchain-based startups craft white papers, presentation decks that resonate with accredited investors and through a captive network of crypto industry consultants, the firm guides those advancing Initial Coin Offerings (ICOs).

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International Equities Execution Expert Enlists With BrokerDealer Industry’s Oldest Firm Owned-Operated By Service-Disabled Veterans

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Mischler Financial Group Adds To International Equities Best Execution Team;

Global Bank Trading Veteran Appointed to Senior Role for 24/6 Agency-Only Platform

Immediate News Release

Stamford, CT July 14, 2014—Mischler Financial Group (“MFG”), the securities industry’s oldest minority investment bank/institutional brokerage owned and operated by service-disabled veterans announced that Eric Michalisin, a close on 20-year sell-side industry veteran and a recognized specialist in international equities execution has joined the firm’s agency-only trading desk. Mr. Michalisin has been appointed, Director, International Equities Sales/Trading. Michalisin will be based in the firm’s Stamford, CT office where he will work directly with Managing Director Rob Livio, who oversees the firm’s 24/6 international equities sales/trading platform.

During the 3 years immediately prior to joining Mischler, Mr. Michalisin was Director, International Equities for RBS Securities. During the 7 years prior, he was a senior member of the international equities desk for JP Morgan Chase. Mr. Michalisin began his sell-side career in 1996 as a Far East equities sales/trading specialist for Robert Fleming, Inc and remained with predecessor firm Jardine Fleming Securities throughout 2001.

Noted Joe Digiammo, Mischler’s global head of equities, “Eric’s major firm background, coupled with his unique insight to local market trading, as well as best execution for US-listed ADRs provides our institutional clients with yet another highly-experienced touch-point for those seeking to navigate global equities markets on a 24/6 basis.”

About Mischler Financial Group

Established in 1994, Mischler Financial Group, Inc. (“Mischler”) is the oldest and largest FINRA member firm certified as a Service Disabled Veterans Business Enterprise (SDVBE). Headquartered in Newport Beach, California with regional offices in Stamford, CT, Boston, MA, Chicago, IL and Detroit, MI,the firm serves leading institutional fund managers, corporate treasurers, public plan sponsors, endowments and foundations by providing agency-only execution within the global equities and fixed income markets; new issue underwriting and syndication within the US Equity and Debt capital markets; and asset management for liquid and alternative investment strategies. The firm’s website is located at www.mischlerfinancial.com

For the full news release, please visit the Mischler Financial Group website via this link.