A collection of stories from SmartBrief publications and around the web…

OCC says Volcker implementation to cost banks between $412M and $4.3B: That price tag sounds shockingly low. Considering all the fuss Wall Street has raised over the past few years desperately trying to beat back Volcker, that range is downright amazing. The estimate is for the cost spread across only the banks the OCC regulates. I would venture to guess those firms have spent somewhere in that range breathlessly lobbying against Volcker.

Wait … Goldman Sachs is calling for more regulation?: In this Wall Street Journal op-ed, Goldman Sachs President and COO Gary Cohn offers a pretty detailed plan for curbing some aspects of high-frequency trading. Outgoing CFTC Commissioner Bart Chilton probably thinks this is some kind of going away present from Cohn. A more cynical view would be that Goldman traders aren’t exactly the fastest “cheetahs” on the street, so Cohn is really just trying to level the playing field. (read more…)

More and more financial advisors are adopting social media to help build their business. SmartBrief recently chatted with Melissa Socci, senior vice president of brand and analytics for LPL Financial, to get her insight on best practices for advisors as they delve into social media. The following is an edited transcript of that conversation.

LPL was a relatively early adopter of social media within the finance space. What lessons did you learn early on about getting advisors to embrace social media?

Our advisors have been able to use social media for about 4 years now and we continue to work with them to help them understand it. These are numbers people so they want to know what the hard ROI numbers are. They want success stories about what has worked from Day One right up until now.

Social media is part of a larger mix of an advisor’s marketing plan. It is not a plan in and of itself. (read more…)

Participants in exchange-traded derivatives markets are urgently looking toward automation in the clearing and confirmation process, and their budgets reflect this priority. According to a new report from Omgeo and consulting firm Greenwich Associates, less than half of buy-side firms reconcile trades in real-time, and two-thirds of exchange-traded derivatives investors still rely on phones, fax machines, emails and text messages during the settlement process.

Manual confirmations increase risk, shown the by the average of 100 trade breaks monthly for buy-side firms, according to the report. This problem will only be compounded as more capital moves into derivative markets due to macro forces. The report notes that “a back-up in rates and unrest in emerging market countries are causing periodic volatility and spikes in volume” the rising cost of capital due to Basel III and other factors will likely mean long-term growth in the demand for exchange-traded derivatives, with event-driven spikes in demand all but certain. (read more…)

Highlights from Day Two of the 39th Annual International Futures Industry Conference in Boca Raton, Fla.

Swinburne calls for more compromise from U.S. on cross-border regulations: U.S. regulators need to do a better job of compromising as they continue the march to implementing global derivatives reforms, according to Kay Swinburne, a member of the European Parliament. “I’m not sure that the U.S. and other large countries are used to the concept of compromise. So when it comes to substituted compliance, compromise is really important,” said Swinburne, who is a member of the Committee on Economic and Monetary Affairs.

Wetjen sees political traction for derivatives-transaction fee: Mark Wetjen, acting chairman of the Commodity Futures Trading Commission, says a proposed fee on derivatives transactions appears to be gaining support among lawmakers. “Maybe I shouldn’t say this, but I will: I do get the sense that there’s more interest in this as each year passes — not so much from market participants but from other parts of the government,” Wetjen said. (read more…)

CBOE Holdings Inc. has announced an investment Tradelegs, a New York-based analytics and decision-support technology. CBOE, the holding company for the Chicago Board Options Exchange and the CBOE Futures Exchange, made the announcement Wednesday at the International Futures Industry Conference in Boca Raton, Fla. The undisclosed investment is subject to delivery of a definitive agreement between the parties.

The Tradelegs Derivatives Strategist platform calculates investment scenarios based on users’ tailored parameters and the opinion of specific securities. Currently, the technology is used by a range of professional investors, including hedge funds, mutual funds, pension funds and insurance companies. CBOE CEO Ed Tilly said the investment is a “natural fit” given the CBOE’s “strategic objective to further expand the institutional use and appeal of options trading, including with our proprietary index products.”

Tradelegs’ founder and CEO Gideon Agar said the investment will allow the company to expand its options optimization services to include securities portfolios, which should happen later this year. (read more…)