By: Json Clemente MAKATI -- The Money Market Association of the Philippines ushers in 2012 with the theme “MART at 41: At the Forefront of Financial Market Development.” In its first board meeting for the year, the newly-elected Board of Directors remained positive and wished to address the vital role of the association and its [...]
“POST” vs. “NO POST” PRICE QUOTATIONS WITH THE BROKER A “posted price” is a live dealable price given by a dealer to the broker and is intended to be broadcasted to all trading participants in a particular market. On the other hand, a “No Post” price, although unannounced is considered dealable. It will be dealt [...]
A posted price is said to be under negotiation when an interested dealer asks the broker for an improvement or for any flexibility in the price quotation. The improved price should only be shown to the negotiating dealer. If not immediately dealt, the broker may announce the improved price to other dealers as a live [...]
WRONG “BIG FIGURE” PRICE QUOTATION Wrong “Big Figure” or “big fig” price quotation is defined in the trading markets as follows: a) USD/PhP Foreign Exchange Spot as PhP 1.00 off the current spot price e.g. USD/PhP Spot Bid Price USD/PhP 44.10 Erroneous Quotation USD/PhP 43.10 Wrong “Big Fig” 43.00 b) USD/PhP Foreign Exchange Forward and [...]
Sizing-up is an action of an aggressor dealer asking how much more volume can the quoting dealer do on top of the initial volume that was shown for the posted price. a) When an aggressor dealer asks for a bigger volume for a posted price without specifying any amount, and the quoting dealer responds with [...]
“All-or-nothing” price quotation is defined as a price for a specified volume and could only be traded in its entirety. Dealers may give an “all-or-nothing” price quotation for a specific volume above the minimum trading lot for business or economic reasons such as, efficiency in booking or getting the whole volume dealt straight away in [...]
Stuffing takes place when a broker loses a price or makes an erroneous price quotation, and he is being obliged by the aggressor dealer to still honor and complete the missed deal. Usually, the price to cover is worse than the price lost; hence, cost is shouldered by the broker who got stuffed. a. Dealers [...]
PhilStar Feature 2011
This paper aims to establish the urgent need to adjust the methodology for the construction of the standard yield curve in the Philippines. In particular we recommend prioritizing the use of market derived yields using the most liquid benchmark securities along the yield curve as opposed to the current methodology where the curve is often [...]
1. A repurchase agreement or a repo is a contract whereby the seller of securities agrees to buy them back at a specified future date and price usually on a short-term basis. The difference between the original price and the repurchase price implies the cost of the repo otherwise known as the repo rate. This [...]
Market color, which is not to be confused with sizing-up the volume, is a terminology normally used in the context of dealers and brokers describing the depth of market liquidity. It is also defined as the ensuing sentiment in the trading markets. The market color is commonly given by a broker to market participant dealers. [...]
POSTED PRICE IS HIT BY TWO OR MORE DEALERS WITH THE MONEY BROKER (BROKER) RESULTING IN TRANSACTION VOLUME LESS THAN THE MINIMUM STANDARD LOT When a posted price with a broker is lifted or given simultaneously by two or more dealers, the volume specified by the quoting dealer will be divided equally among the aggressor [...]
POSTED PRICE IS HIT BY TWO OR MORE DEALERS WITH THE MONEY BROKER (BROKER) RESULTING IN TRANSACTION VOLUME LESS THAN THE MINIMUM STANDARD LOT When a posted price with a broker is lifted or given simultaneously by two or more dealers, the volume specified by the quoting dealer will be divided equally among the aggressor [...]
TRADING PRACTICES - THE PRICE QUOTED TO THE BROKER IS “SUBJECT” / “UNDER REFERENCE” OR “INDICATIVE” THE PRICE QUOTED TO THE BROKER IS "SUBJECT" / "UNDER REFERENCE" OR "INDICATIVE" "Subject", "under reference", and "indicative" price terminologies are interchangeably used by dealers. A "subject", "under reference", or "indicative" price is not a firm price. The broker [...]