Derivatives & Futures
Our derivatives and futures team advises clients across all asset classes, helping a broad range of sell- and buy-side market participants to design, document, and negotiate transactions that advance their diverse and ambitious business objectives. We counsel clients on the full spectrum of issues accompanying over-the-counter and exchange-traded derivatives—including equity, debt, credit, commodity, interest rate, currency, and exotic derivatives.
Whether an end-user or the creator and marketer of a derivative product, our expansive transactional and regulatory knowledge means that we can facilitate successful and game-changing trades within mandated regulatory frameworks.
Innovation is Essential
Our team understands that product innovation is vital as the derivatives market adapts to an ever-evolving regulatory environment. We advise clients on an array of leading-edge transactions—including using derivatives to synthetically transfer tranches of illiquid asset–related risk to sophisticated investors, structuring synthetic transfers of derivative books between dealers, and developing new forms of securities financing transactions to offer clients.
Our lawyers advise on easing the LIBOR transition, resolution stays, workouts, and developments involving centralized clearing and trading of securities financing transactions. We also use derivatives to aid clients in hedging risk, monetizing assets, and financing asset acquisition on favorable terms (with or without the benefit of leverage), including the financing of issuers’ equity and debt repurchase programs. Beyond counseling clients on standalone derivative products, our lawyers advise on securitizations and financial instruments with embedded derivatives such as equity-linked notes, convertible securities, and other hybrid products.
Navigating the Regulatory Terrain
Our clients confront myriad regulatory hurdles in the derivatives arena. To address and overcome these obstacles, we draw on the talents of our regulatory lawyers with experience counseling on derivatives regulation, guidelines, and investigations by the Commodity Futures Trading Commission (CFTC), US Securities and Exchange Commission (SEC), and Federal Energy Regulatory Commission, among others. We routinely advocate for clients in regulatory and exchange investigations as well as enforcement actions involving futures and derivatives transactions.
In addition, we advise on regulatory questions related to Dodd-Frank Act implementation, including work for several major exchanges and clearing organizations. Our experience includes handling the registration of the first CFTC-registered swap data repository and assisting in the registration of several swap dealers. We also guide commodity pool operators and trading advisors through the registration requirement landscape as well as the interpretation and restructuring of significant commercial energy contracts in light of regulatory changes.
Securing Regulatory Relief
Our team has been closely involved in obtaining regulatory relief for clients from the SEC and CFTC, including advocating on behalf of the Securities Industry and Financial Markets Association and Managed Funds Association in securing a safe harbor for commodity pools from the definition of “eligible contract participant,” and obtaining a safe harbor from the SEC and CFTC for spot foreign exchange transactions in connection with the purchase and sale of securities.