| March 01, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | CME Group plans to launch micro-sized Bitcoin and Ether options
Turner Wright - Cointelegraph
Major derivatives marketplace Chicago Mercantile Exchange Group will launch options trading for its micro Bitcoin and Ether futures products.
In a Tuesday announcement, the CME Group said that subject to regulatory review, it plans to launch options contracts for its existing micro Bitcoin (BTC) and Ether (ETH) futures that will be 10% the size of the respective tokens. The futures options, expected to start trading on March 28, will come more than two years after the firm launched a BTC options trading product in January 2020 and more than four years since the group launched the first Bitcoin futures contract in December 2017.
/jlne.ws/3toNIEW
Traders Make Millions by Short-Selling Russian Exchange-Traded Funds
Alexander Gladstone - WSJ
Traders looking to monetize the financial fallout from Russia's invasion of Ukraine have racked up millions of dollars of wins over the past week by short-selling Russian exchange-traded funds.
While Russia's central bank last week made an order preventing the short-selling of individual Russian stocks, it is still possible to short ETFs, which are baskets that aggregate the stocks of Russian companies. Short sellers borrow shares in ETFs that they think are overvalued and immediately sell them. They then aim to repurchase the shares for a lower price later before they return the shares, making a profit by pocketing the difference if the securities decline in value.
/jlne.ws/3hzwQpu
Traders Pay Up as Costs Soar to Hedge Against Treasury Rally
Edward Bolingbroke - Bloomberg
Traders are having to pay the most since the March 2020 liquidity crisis to hedge against a deeper drop in Treasury yields as the flight-to-quality bid intensified Tuesday.
The cost of insurance has soared this week as yields on 10-year Treasury notes have looked to retest 1.70%, which would be the lowest since Jan. 13, as the war in Ukraine deepens and traders pull back on expectations for Federal Reserve rate-hike bets.
/jlne.ws/35FuzGK
Asset managers flee Russia as volatility spreads; Liontrust and JP Morgan suspend funds; With the Moscow Stock Exchange shuttered until at least 5 March, fund managers are rapidly attempting to unwind their Russian positions.
Laurie McAughtry - The Trade
The ongoing Russian invasion of Ukraine and the rapidly scaled-up economic sanctions against Russia - including asset freezes, a ban on transactions with the central bank, and the cancellation of rouble trade settlements - has led to a scramble amongst investment managers to delink and distance themselves from the Russian market.
/jlne.ws/3HrFwJe
Watch JPMorgan's Dimon on Market Volatility: Get Used to It
Bloomberg (VIDEO)
JPMorgan Chase Chairman and CEO Jamie Dimon says market volatility is inevitable. He speaks during an interview with Bloomberg's Ed Hammond at the JPMorgan Global High Yield and Leveraged Finance Conference in Miami. (Source: Bloomberg)
/jlne.ws/3IzIexP
Watch Citadel's Griffin: Markets at Volatile Inflection Point
Bloomberg (VIDEO)
Citadel CEO Ken Griffin says markets are at a very, very volatile inflection point as fighting continues in Ukraine. Griffin spoke Feb. 25 at Citadel's offices in Chicago about the fallout in markets from Russia's invasion and the negative ramifications that current U.S. sanctions could have on technology firms and the U.S. dollar. His comments are from an upcoming episode of "Bloomberg Wealth with David Rubenstein" which airs March 22 at 9 p.m. ET on Bloomberg Television. (Source: Bloomberg)
/jlne.ws/3C7gOwx
Euro Traders Get Nervous Over Economic Blow From Ukraine Crisis
Vassilis Karamanis - Bloomberg
Traders are increasingly hedging against declines in the euro as they brace for the damage that war in Ukraine could wreak on the European economy.
Given the region's dependence on Russian fuels, the deepening crisis is throwing up a panoply of risks including the threat of persistently high energy prices that could derail recovery from the pandemic.
/jlne.ws/3IAKXqG
Russia Suspended Stock Trading. Expect Big Losses When Markets Reopen.
Evie Liu - Barron's
Russia's Moscow stock exchange was shut on Monday, as the country's central bank tries to contain the fallout from harsh sanctions following Russia's invasion of Ukraine. But Russian stocks listed overseas and the exchange-traded funds tracking them continued to trade, giving investors clues to how the market might react once it reopens.
The bottom line: Big losses can be expected.
/jlne.ws/3HAgUy6
Investors who think the stock market is back to normal should stay 'humble' and position for continued Russia-Ukraine uncertainty, Mohamed El-Erian says
Phil Rosen - Business Insider
Famed economist Mohamed El-Erian says investors who think markets have reverted to normal after a brutal sell-off should remain "humble," with multiple hurdles standing in the way of prolonged market stability.
In a Bloomberg op-ed column, El-Erian warned that the status quo is likely to change if both Russia and the West become more involved with the crisis in Ukraine. Despite last week's stock rally, he still expects more volatility ahead.
/jlne.ws/3hwVCGS
| | | | | | Exchanges | | | CME Group to Launch Micro-Sized Bitcoin and Ether Options
CME Group
CME Group, the world's leading derivatives marketplace, today announced it plans to launch options on Micro Bitcoin and Micro Ether futures on March 28, pending regulatory review.
The new Micro Bitcoin and Micro Ether options contracts will be one-tenth of their respective underlying tokens in size and will offer a wide range of market participants - from institutions to sophisticated, active, individual traders - more ways to manage their exposure to the top two cryptocurrencies by market capitalization. These contracts will complement the existing Bitcoin options contracts, sized at five bitcoin and launched in 2020. Additionally, they will allow clients to express long- or short-term views with a choice of monthly as well as Monday, Wednesday and Friday weekly options expiries.
/jlne.ws/35Fzqrm
| | | | | | Regulation & Enforcement | | | ISDA Publishes Documentation to Align Derivatives and SFT Markets
ISDA
The International Swaps and Derivatives Association, Inc. (ISDA) has published a new definitional booklet and related set of provisions designed to allow firms to document derivatives and securities financing transactions (SFTs) under a single ISDA Master Agreement.
/jlne.ws/3psQIiG
| | | | | | Strategy | | | Don't Let a Good Options Spread Expire
Nasdaq
Over the last several weeks, I have written about option credit spreads. At the end of each email, I asked you to submit any topics you want to learn more about. The response has been AMAZING! Reading through your feedback, I discovered just how many of you are interested in learning more about options.
That's why today, I want to cover a special topic that has come up in multiple emails: options spread management. Folks want to know how to establish a position, where and when to take profits, and how to avoid losses when possible. The good news is that I have those answers. So, let's start at the beginning.
/jlne.ws/3Hv0vLb
Jim Cramer: Charts suggest it's not time to go all-in on stocks yet
Kevin Stankiewicz - CNBC
Investors should be a little more patient before going all-in on the unsettled stock market, CNBC's Jim Cramer said Monday, summarizing the latest takeaways from technical analyst Mark Sebastian.
Sebastian looked at the trajectory of the VIX, Wall Street's so-called fear gauge, and the S&P 500 in order to help make sense of heightened volatility during the ongoing Russian-Ukrainian conflict.
/jlne.ws/3K9akAk
How to Play Volatility With ETFs
Sweta Killa - Nasdaq
Volatility is set to rise further as we enter into a new month. This is especially true as the tensions between Moscow and the West over Ukraine, higher inflation and the Fed rate hike bets continued to keep investors on edge.
In such a scenario, investors should apply some hedging techniques to their equity portfolio. While there are a number of ways to do this, volatility-hedged ETFs like Amplify BlackSwan Growth & Treasury Core ETF SWAN, Invesco S&P 500 Downside Hedged ETF PHDG, Aptus Drawdown Managed Equity ETF ADME, DeltaShares S&P 500 Managed Risk ETF (DMRL) and Nationwide Risk-Based U.S. Equity ETF RBUS could prove beneficial amid market uncertainty. Investors should note that these funds have the potential to stand out and outperform the simple vanilla funds in case of rising volatility.
/jlne.ws/3tkQMlN
| | | | | | Miscellaneous | | | Jefferies Holds 'Doing Good' Global Trading Day
MarketsMedia
Jefferies Calls on Wall Street and Investors Around the World to Stand Together for Freedom and Support the People of Ukraine As They Face the Gravest of Threats
Jefferies announced that it will hold a Doing Good Global Trading Day on Wednesday, March 2, 2022 to support accredited charities focused on providing humanitarian aid to the People of Ukraine.
/jlne.ws/36IQtta
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| | | Jeff Bergstrom
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