Bloomberg
“Ex-JPMorgan Traders Start Singapore Currency Options Quant Fund.”
Two former JPMorgan Chase & Co. foreign-exchange option traders will start a quantitative hedge fund in January, using artificial intelligence to trade currency options.
Atsuo Ogaki and Damien Loh have established Ensemble Capital Pte Ltd. in Singapore with capital $75 million from high-net worth investors, family offices and institutional investors, Ogaki, who has taken the chief executive officer role, said in an interview.
The fund aims to generate annual returns of 15 percent, Ogaki said. “We want to stick to our original objective as a hedge fund to pursue absolute return and eliminate correlations with traditional asset classes.”
Ogaki joined Chase Manhattan Bank, the precursor to JPMorgan, in 1988, where he spent 23 years trading currency options before moving to the foreign-exchange department of Nomura Securities in 2010. Loh had 15 years as a currency options trader at JPMorgan before co-founding Ensemble, where he will be chief investment officer.
Ensemble aims to generate returns through machine learning and deep-learning artificial intelligence — analyzing factors including seasonality, asset relationships and economic data. It will also use AI to forecast currency options, including direction, range, conviction and time period.
Tests showed the model produced an annualized return of 12.7 percent after fees over the past 10 years, and a Sharpe ratio — which measures a fund’s performance adjusted for risk — of 1.34 percent. Ensemble will initially trade options of Group-of-10 and emerging Asian currencies. It plans to expand into interest-rate options, swaps and then commodity and equity indexes, Ogaki said.
Reuters
“Uber’s third-quarter net loss widens to $1.46 billion: source.”
Uber Technologies Inc’s [UBER.UL] quarterly losses widened, a source familiar with the matter told Reuters on Tuesday, as the ride-hailing company wades through legal troubles and faces regulatory scrutiny across the globe.
The Silicon Valley-based company’s net loss increased to $1.46 billion in the third quarter from $1.06 billion in the previous quarter, the source said.
Quarterly net revenue rose 14 percent to $2 billion and gross bookings increased 11.5 percent to $9.7 billion, on a sequential basis, the person said.
As a private company, Uber is not required to publicly report its financial results, but earlier this year it began offering a glimpse of its performance by disclosing certain numbers.
On Tuesday, a consortium led by SoftBank Group Corp (9984.T) launched a tender offer for shares of Uber. The Japanese company said some notable early Uber investors including venture capital firms Benchmark, which owns 13 percent of Uber worth $9 billion, and Menlo planned to sell stock.
Uber has been hit by a series of scandals this year with the latest being a regulatory crackdown after disclosing that it paid hackers $100,000 to keep secret a massive breach last year that exposed personal data from around 57 million accounts.
The Financial Times had earlier reported Uber’s third quarter figures.
BBC News
“Brexit: UK divorce bill offer worth up to 50bn euros.”
The UK has offered a larger potential «divorce bill» to the EU – which could be worth up to 50bn euros (£44bn). There has been no final agreement on a number but the offer was given a «broad welcome» by Brussels, BBC political editor Laura Kuenssberg said.
Foreign Secretary Boris Johnson said the UK would make a «fair offer» to help break the current deadlock. «Now is the moment to get the whole ship off the rocks and move it forwards,» he said during a trip to Ivory Coast, where he is attending a meeting of European and African leaders.
In September Theresa May suggested the UK was willing to pay about 20bn euros to meet obligations arising from its membership but the EU has been calling for its offer to be increased. The UK is hoping to move on to talking about trade but the EU will only do this when it deems «sufficient progress» has been made on three areas – the so-called divorce bill, the rights of EU citizens in the UK after Brexit and the Irish border.
The UK accepts that it has some obligations. And it has promised not to leave any other country out of pocket in the current EU budget period from 2014-20. But the devil is in the detail. There are also longer term issues like pensions for EU staff, and how the UK’s contribution to these is calculated for years to come, and the question of what happens to building projects that had funding agreed by all EU members including the UK but which will only begin construction after the UK has left.
Bloomberg
“OPEC-Russia Deal Faces One Last Hurdle: Knowing How to Stop.”
OPEC and Russia concur on two things: their oil production cuts are working and they should be extended deeper into next year. What’s proving more elusive is an accord on when and how to end the curbs.
As ministers gather in Vienna, this unanswered question is the main reason Russia has yet to give its formal assent to a rollover of their agreement until the end of next year, according to people familiar with the matter. Moscow wants clarity about what comes afterward — something the Organization of Petroleum Exporting Countries doesn’t usually provide.
«We will talk about it,» Kuwaiti Oil Minister Issam Almarzooq said Tuesday, when asked if there would be an exit strategy discussion this week.
In previous rounds of OPEC cuts the exit strategy was traditionally an afterthought. When the group wanted out, it simply started cheating on its own cuts by slowly, often secretly, increasing production. The current agreement involves ten non-members including Russia, which would prefer a clear road map over the obscure habits of a 57-year-old cartel.
“There is always debate — every country has an equal weight to voice their view,” Saudi Energy Minister Khalid Al-Falih said in Dubai on Tuesday before traveling to Vienna. “We’re looking forward to getting everybody engaged in a robust discussion and we’ll come up with the right decision.”
The differences between OPEC and Russia are more about tactics than strategy, because all the producers want to avoid stoking price volatility, according to delegates and analysts. Benchmark Brent oil prices traded at $63.04 a barrel in London, 36 percent higher than a year ago.