| June 01, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | Yesterday was Alex Teng's last official day at John Lothian News. Episodes of Options Discovery featuring Alex that have yet to be published are forthcoming in the next couple of weeks, including one today with Nasdaq's Sean Feeney that was done at the Options Industry Conference in Nashville in May. Alex graduated from the University of Illinois at Chicago with a degree in finance and headed off for a job with Tesla this summer. However, before he left, he recruited a replacement from UIC from the boxing team he was a member of there.
Asma Awass, who just completed her sophomore year at UIC and is also a finance major, will be assuming the role as host of the Options Discovery video program that is part of JLN's The Spread video series. Asma, which is pronounced "s-ma," is also working on a minor in business analytics. She went through a very elaborate process to interview for the position that included a practice video on a particular subject, then an interview with me as a subject matter expert.
We hired Alex with a much less complicated process. I said, "Hey, I see you are doing finance-related videos. Would you like to do videos about options trading and get paid for it?" Alex said yes and the rest was history. Alex had also been a student of JLN contributor Sally Duros, a UIC adjunct professor, so we had some knowledge of him and his capabilities.
We are very pleased to welcome Asma to the JLN team and thank Alex greatly for all his contributions. He was entirely professional during his tenure and did exceptional work for JLN. We wish him the very best during his career and thank him for opening a path for UIC students to follow in his footsteps and the example he set.
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Options Discovery Episode 18
JohnLothianNews.com
Alex Teng talks about short dated options and interviews Sean Feeney, the head of US Options at Nasdaq.
Listen to the podcast »
| | | | | | Lead Stories | | | AI Tech Rally Masks 'Violent Rotations,' RBC's Silverman Says
Peyton Forte and Alix Steel - Bloomberg
A handful of megacap technology stocks have propped up equity markets for the past several weeks as hype surrounding artificial intelligence lures in sidelined investors.
But the fear of missing out on the rally is becoming cause for concern in the options market, says RBC Capital Markets' Head of Derivatives Strategy Amy Wu Silverman.
/jlne.ws/43hinVL
Market Volatility Fades as Debt-Ceiling Deal Nears
Eric Wallerstein - WSJ
The stock market's primary gauge of volatility is falling back to historically low levels now that a deal on raising the debt ceiling looks near.
/jlne.ws/43tEiIW
Libor's Last Users Face Challenges as the Deadline for Its Demise Nears
Mark Maurer - WSJ
Companies that haven't switched away from the scandal-plagued London interbank offered rate ahead of the June 30 deadline for the benchmark's demise aren't likely to disrupt credit markets, but they could face a host of operational risks and potentially higher borrowing costs.
/jlne.ws/3N83QpC
Inside My Trade: The Trader Who Looks Forward to the Stock Market's 'Power Hour'
Gunjan Banerji - WSJ
Simrath Sangha says she began trading regularly after finding herself with tons more time during the Covid-19 pandemic.
These days, she enters dozens of stock and options trades each week while dispensing investing tips to a group on the online platform Discord. Many pay more than $100 a month for the tips and the chance to chat with Sangha, who's in her 30s.
/jlne.ws/42kJ7TZ
| | | | | | Exchanges | | | Trade Up to Market Close With XSP
Cboe
Unlike SPY and other ETF options, Cboe's Mini-SPX (XSPSM) index options provide traders the ability to trade right up to the market close on expiration day. XSP is European style and cash settled, meaning there is no delivery of unwanted shares, lowering the risk that a broker will prevent a same day trade or force settlement before the close. XSP also offers additional benefits beyond those of SPY, including global trading hours allowing traders to react to market events around the clock.
/jlne.ws/3OTHZ6z
Why Trade XSP vs. SPY? A Breakdown of the Benefits
Cboe
The S&P 500 Index option suite ranges from the standard size contract, SPX , to the Mini-SPX (XSPSM) contract at 1/10th the size of SPX, to Nanos at 1/100th the size of XSP. One of the many questions we get is why would a retail trader choose XSP versus the popular SPY ETF option? With both XSP and SPY having similar notional size (contract value), weekly expirations and PM-settlement, they are typically considered direct competitors. But XSP has a couple of advantages over SPY.
/jlne.ws/3oJ6R6q
XSP: More Potential Benefits Than SPY
Cboe
Index options and ETF optionsâespecially those that track broad market indices like the S&P 500âare very similar. With one trade, market participants can gain broad market exposure, hedge their portfolios, or execute a variety of trading strategies. At 1/10th the size of SPX, XSPSM offers very similar notional size, weekly expirations, and PM-settlement to SPY, but with even more potential benefits.
/jlne.ws/45EHFyC
MIAX Options And MIAX Pearl Options Exchanges June 1, 2023 Fee Changes
MIAX
Effective June 1, 2023, pending filing with the SEC, MIAX Options and MIAX PEARL Options will amend transactional fees
/jlne.ws/3N6y9Nq
| | | | | | Regulation & Enforcement | | | CFTC Warns Derivatives Clearinghouses against Expansion into Crypto; The derivatives watchdog raised concerns about crypto cyber security risks.; The CFTC tasked clearinghouses with identifying 'new, evolving or unique risks'.
Finance Magnates
US derivatives regulator, the Commodities Futures Trading Commission (CFTC), has warned Derivatives Clearing Organizations (DCOs) against the risk involved in the expansion of their clearing services into digital assets. DCOs are firms that match and settle derivatives contracts based on underlying assets, such as stocks, bonds or currency.
/jlne.ws/3oJkkuQ
| | | | | | Technology | | | Cboe Europe Indices latest to be integrated into BMLL product suite; The move compliments Cboe's historical data for Europe, US, and Japan which is already offered via BMLL.
Claudia Preece - The Trade
Historical Level 3 data provider BMLL has added Cboe Europe Indices to its product suite - and is now available via its research and data visualisation tools, BMLL Data Lab, BMLL Data Feed and BMLL Vantage. Speaking in an announcement, BMLL highlighted the importance of the addition of new data sets in enhancing data coverage for market participants globally.
/jlne.ws/43iQxIH
AI Bots Are Coming to Finance
Matt Levine - Bloomberg
Here is a surprising statistic:
AI is also expensive, both to develop and to run. Estimates show the costs of using large language models to answer a question can be as much as $14 per query, compared with $6 via a human lawyer, according to Lewis Z. Liu, founder and CEO at Eigen. That's because of the extensive cloud computing costs associated with dealing with complex financial documents.
/jlne.ws/3ITGWzL
Hedge funds are using ChatGPT to do mundane grunt work
Justina Lee and Saijel Kishan - Fortune
The latest artificial-intelligence hype is powering a massive surge in the stock market on bets that a new era of innovation is nigh.
Yet for money managers who weaponize computing advances for an investing edge, the era of ChatGPT holds a less lofty promise for now: Automating the grunt work.
/jlne.ws/45JAPrq
| | | | | | Strategy | | | 15 Trades to Make Now Before the $7 Trillion AI Explosion: GS
James Faris - Business Insider
Once a niche technology, artificial intelligence (AI) has moved firmly into the mainstream in 2023 and become too big to ignore, according to Goldman Sachs.
AI tools like viral chatbot ChatGPT and image generator DALL-E have exploded in popularity and normalized the creation of computer-generated content that would've been unimaginable just a few years ago.
/jlne.ws/42hkd7B
Millions of Tesla Options
Cboe (Video)
In today's #Vol411, Scott Bauer @cboesib gives market updates and talks $VIX and $SPX #options, #VIX #futures and more.
/jlne.ws/42rpPfO
| | | | | | Events | | | Cboe Global Markets to Present at Piper Sandler's Global Exchange & FinTech Conference on Thursday, June 8
Cboe Global Markets
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, today announced that Ed Tilly, Chairman and Chief Executive Officer, will present at Piper Sandler's Global Exchange & FinTech Conference on Thursday, June 8 at 10:30 a.m. ET. The webcast and replay of the presentation will be accessible at www.cboe.com in the Investor Relations section, under Events and Presentations. The archived webcast is expected to be available within an hour of the presentation.
/jlne.ws/3oAJyMa
| | | | | | Miscellaneous | | | Goldman warns of new job cuts in 'tougher environment' on Wall Street
Joshua Franklin - Financial Times
Goldman Sachs is preparing for "a tougher environment" by laying off more employees, which may help it surpass a $600mn savings target from job cuts, one of the bank's top executives said on Thursday.
The warning from Goldman president John Waldron underscores the increasingly gloomy outlook on Wall Street as rising interest rates have damped merger activity and the market for initial public offerings, while a recent trading boom has also fizzled.
/jlne.ws/3OOTJY0
Americans are 'more afraid of running out of money than death'
Brett Arends - MarketWatch
A new survey finds that 61% of us are more afraid of running out of money in our old age than we are of dying itself.
Life insurance giant Allianz, which conducted the survey, found the result "remarkable," but actually it sort of makes sense. Death is inevitable, running out of cash isn't.
And when you're dead, you're dead. Maybe it sucks, but you don't know about it.
Being old and broke: Not the same.
/jlne.ws/3N7FWdX
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| | | | John Lothian News (JLN) is the news division of John J. Lothian & Company, Inc. (JJLCO). The online media and financial services firm is staffed by derivatives industry, journalism and technology professionals. | | | | | | | John Lothian News Editorial Staff: | | | John Lothian
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Editor
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