Traders Magazine spoke with Shirley Liu, Head of Derivatives Solutions at Mizuho Americas, who won Best in Derivatives at the 2023 Markets Choice Awards.
Please tell us about Mizuho Americas and your trading desk and its capabilities.
Mizuho Americas is a leading corporate and investment bank and part of Mizuho Financial Group, one of the largest banks in the world. In the past few years, we’ve been on a major growth trajectory in the US. In the last year in particular, despite a challenging issuance environment and M&A market, our Derivatives Solutions group leveraged an expanded product suite – built through technology and a focus on client-tailored solutions – to deliver accelerated growth. We now have a full-service fixed income derivatives franchise with capabilities across products and currencies, which allows us to offer clients integrated solutions backed by our superior execution capabilities.
What are the current derivatives trading trends?
We are watching three main trends impacting derivatives trading today: The transition from LIBOR to SOFR and the $200 trillion of financial contracts and securities it involves, clients positioning for an eventual Fed pivot to easing, and clients leveraging net investment hedge capacity to manage interest expense in a higher cost-of-funds environment.
How has your approach to execution evolved over recent years?
Our execution approach is centered around expert knowledge of underlying markets, and we have taken a very deliberate, consistent approach to execution by providing strong liquidity to our client base as a market maker in derivatives markets. The pandemic pushed a greater amount of trading volume executed electronically, with sales and clients over chat than traditional voice execution over the phone.
How does your trading platform differentiate in a competitive landscape?
We have undergone a multi-year, multimillion-dollar infrastructure technology overhaul to develop state-of-the-art capabilities. This has accelerated valuation adjustments to derivative contracts and opened new avenues for product expansion. We also integrated our coverage groups and aligned products across client segments to create an efficient and unified derivatives solutions platform.
In particular, we are a best-in-class provider of deal contingent/event driven hedging instruments, maintaining one of the largest portfolios on the Street. The breadth of our deal contingent hedging business sets us apart from our competition in that we are able to provide solutions across rates and FX products to a variety of different clients and transaction types.
What strategy are you using to improve clients’ experience for your business?
Our goal is to be the solutions-led, client-focused strategic hedging provider to clients – to analyze and mitigate sizable risk exposures affecting their day-to-day business, M&A, and financing transactions across an array of geopolitical environments. We focus on the entire life cycle of the trading experience – assisting our clients with identifying and quantifying market risks, providing thoughtful solutions to manage those risks, as well as an efficient onboarding and execution process, and seamless confirmation and settlement process.
Many clients now see Mizuho as their top call for advice, relationship, and trading, so we want to maintain our impressive growth trajectory, continue expanding our product offering, and grow our relevant market share.
