Luxembourg surfs Brexit wave to strengthen its private equity industry

Luxembourg surfs Brexit wave to strengthen its private equity industry

Luxembourg is renowned worldwide for its fund administration industry currently hosting at least 15 of the 20 largest global funds (including Carlyle, Blackstone, KKR, Apollo ...), which  have structures and / or funds domiciled in the country. The Brexit has created a major challenge for Luxembourg, as the country will have an opportunity to attract a maximum of the British market players as a consequence to the decision taken on 29 March 2017.

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Targeted Review of Internal Models: What to expect?

Targeted Review of Internal Models: What to expect?

Following the financial crisis of 2007-2009 doubts had emerged on the relevance of the internal models to calculate Risk-Weighted Assets (RWA). The minimum capital required to absorb losses corresponds to a percentage of the RWA. To calculate the RWA, different type of risks (credit risk, market risk and operational risk) are taken into account and each asset class has different risk weights associated with them. As we can see in the scheme below, to calculate these risk weights, banks have the choice between the internal models or the standardized models.

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The Rise of ETFs: A Bubble in the Making?

The Rise of ETFs: A Bubble in the Making?

In December, the S&P 500 plunged, briefly falling as much as 20% below its all-time high. The U.S. stock market falling to the cusp of a bear market didn’t slow ETF (Exchange Traded Funds) investors :  nearly $50 billion inflow into U.S.-listed ETFs in December, propelling 2018 into the record books as the year with the second-largest inflows ever ($315.4 billion for the whole of 2018).

Since the flash-crash in May 2010, specific measures related to ETF’s were put in place as  ETFs played a significant part in the fall, with 68% of more than 21,000 cancelled trades coming from ETF investors. These measures included trading limits designed to prevent sudden changes in securities’ prices.

So with the continued massive inflow into ETF’s, is there a bubble in the making? Our experts give their view on the subject

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