Sep 06, 2018
Lary Stromfeld comments on the secured overnight financing rate (Sofr), a new lending reference rate established by the Federal Reserve Bank of New York.
An excerpt from “PRIMER: the Secured Overnight Financing Rate,” IFLR, September 6, 2018:
"The goal is to take an overnight rate and turn it into term periods. For example, if the overnight Sofr rate is x, what would the rate be if you were talking about a 3-month Sofr rate? That is something that is best determined again through trading activity," said Lary Stromfeld, partner at Cadwalader. "You need a futures market that can determine what the market believes a 3-month Sofr rate would be relative to the overnight rate, and that is what this is.”
“It begins to address one of the structural elements that needs to develop to make the overnight rate into something that is more of a term period," he added.
Scott Cammarn, Mark Chorazak, Jonathan Watkins,Chris Gavin, Joseph Beach, Peter Morreale
Richard Brand, Stephen Fraidin, Jonathan Watkins, James Fee
Michele Maman, Thomas Curtin, Anthony De Leo, Donny Ariel
Jeffrey Rotblat will discuss "Accumulation/Aggregation/Alternative Exit Strategies" at this event.