| September 20, 2019 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
|
| | | | Observations & Insight | | |
Mary Savoie: The Importance of Investor Education
JohnLothianNews.com
In this video from MarketsWiki Education's World of Opportunity event in Chicago, Mary Savoie, executive director of the Options Industry Council and first vice president, investor education, for OCC, talks about the importance of investor education and how to become an informed investor. She discusses the role of the OIC in unbiased education for the complicated options industry. Education can lower barriers to options investing and boost people's confidence, she said, and it is good for the health of the financial markets as a whole.
Watch the video »
| | | | | | Lead Stories | | | General Motors Strike Unleashes Frenzy of Options Trading
Gunjan Banerji - WSJ
The strike at General Motors GM Co. this week unleashed a flurry of trading in the company's options, with some investors bracing for extreme moves in the stock. Volumes on GM options hit the highest level since July on Thursday, according to data provider Trade Alert. The United Auto Workers called its first strike in more than a decade earlier this week.
/on.wsj.com/2kUdNwz
Quadruple Witching Brings Heightened Volumes and, Potentially, Volatility
Gunjan Banerji - WSJ
Stock volatility has fallen in recent days. But turbulence could pick up Friday as a flurry of derivatives are set to expire.
The Cboe Volatility Index, or VIX, edged down in early trading Friday, falling about 3.5% as the S&P 500 edged up 0.3% shortly after the opening bell. The options-based gauge traded at Cboe Global Markets Inc. tends to fall when the S&P 500 is rising, and vice versa.
/on.wsj.com/2Nqi5sa
****MR: Also see: Dow and S&P 500 near record highs with U.S. - China trade talks underway against backdrop of Fed rate cut by Chris Matthews and Mark DeCambre, MarketWatch.
CME Group to Launch Bitcoin Options in Q1 2020
CME Group
CME Group, the world's leading and most diverse derivatives marketplace, today announced it will launch options on its Bitcoin futures contracts in Q1 2020, pending regulatory review.
"Based on increasing client demand and robust growth in our Bitcoin futures markets, we believe the launch of options will provide our clients with additional flexibility to trade and hedge their bitcoin price risk," said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products. "These new products are designed to help institutions and professional traders to manage spot market bitcoin exposure, as well as hedge Bitcoin futures positions in a regulated exchange environment."
bit.ly/30gRG6a
Great Time to Be Long Volatility
Bloomberg (VIDEO)
In this edition of "Options Insight," Headwaters Volatility's Matt Rowe examines the recent volatility in stocks and his investment strategy with Bloomberg's Luke Kawa on "Bloomberg Markets: The Close."
/bloom.bg/2NoLmU7
Oil traders reassess interruption of Saudi output
John Kemp - Reuters
Brent oil futures prices have gyrated wildly as traders have tried to assess the impact of last week's attacks on Saudi Arabia's oil infrastructure on the actual availability of crude.
Brent's six-month calendar spread surged to a backwardation of more than $5.50 per barrel on the first trading day after the attacks, the highest for six years, showing oil traders were anticipating severe shortages in the very short term.
/reut.rs/2NqgvH0
Mitsubishi says Singapore-based oil trader lost $320 million in unauthorized trades
Aaron Sheldrick and Shu Zhang - Reuters
Mitsubishi Corp (8058.T), Japan's biggest trading house by revenue, said on Friday a trader at its Singapore-based unit has lost $320 million through unauthorized transactions in crude oil derivatives, and the matter has been reported to the police.
/reut.rs/2NsVBqn
| | | | | | Exchanges and Clearing | | | INTL FCStone joins SGX as derivatives trading and clearing member
Hayley McDowell - The Trade
Securities and commodities broker INTL FCStone has joined the Singapore Exchange (SGX) as a trading and clearing member.
The addition of INTL FCStone Pte, a subsidiary of New York-based INTL FCStone Inc, to the SGX derivatives market expands its footprint in North America, and takes its total trading members to 62, and clearing members to 25, the exchange operator said in a statement.
bit.ly/31yUmJP
CME Group Inc. Announces Third-Quarter 2019 Earnings Release, Conference Call
CME Group
CME Group Inc. will announce earnings for the third quarter of 2019 before the markets open on Wednesday, October 30, 2019. Written highlights for the quarter will be posted on its website at 6:00 a.m. Central Time, the same time it provides its earnings press release. The company will hold an investor conference call that day at 7:30 a.m. Central Time, at which time company executives will take analysts' questions.
bit.ly/30dMJuO
| | | | | | Regulation & Enforcement | | | Row Over Brexit Harms Derivative Trading, French Watchdog Argues
Silla Brush - Bloomberg
France's top markets regulator said Brexit threatens to push derivatives away from Europe toward London and the U.S., calling for major changes to European rules to prevent an exodus.
With just six weeks until Britain leaves the European Union with or without a deal, Robert Ophele, chairman of France's Autorite des Marches Financiers, used a speech in London to argue that the EU risks self-harm unless it gives firms more leeway to trade derivatives in the U.K. He joins British regulators in calling for a solution that keeps markets moving.
/bloom.bg/30dmS69
Notice of Disciplinary Action: CME 17-0803-BC-2
CME Group
Pursuant to an offer of settlement in which Christian Reynoso ("Reynoso") neither admitted nor denied the rule violations upon which the penalty is based, on September 18, 2019, a Panel of the Chicago Mercantile Exchange ("CME") Business Conduct Committee ("Panel") found that on four occasions between May 2017 and October 2017, Reynoso, a broker in the Eurodollar options on futures pit, non-competitively traded contracts opposite other brokers within the same brokerage group without bidding of offering his orders in a manner consistent with open and competitive trades.
bit.ly/2kUb32f
Notice of Disciplinary Action: CME 17-0803-BC
CME Group
Pursuant to an offer of settlement in which Scott Moore ("Moore") neither admitted nor denied the rule violations upon which the penalty is based, on September 18, 2019, a Panel of the Chicago Mercantile Exchange ("CME") Business Conduct Committee ("Panel") found that on four occasions between May 2017 and October 2017, Moore, a broker in the Eurodollar options on futures pit, non-competitively traded opposite other brokers within the same brokerage group without bidding or offering his orders in a manner consistent with open and competitive trades.
bit.ly/2kWY7bN
Notice of Disciplinary Action: CBOT 18-0997-BC
CBOT
Pursuant to an offer of settlement in which Leonid Uvarov ("Uvarov") neither admitted nor denied the rule violation upon which the penalty is based, on September 18, 2019, a Panel of the Chicago Board of Trade Business Conduct Committee ("Panel") found that on three dates in April and June 2018, Uvarov entered matching buy and sell orders on the CBOT Globex trading platform in May and July 2018 Wheat TAS futures contracts, as well as July 2018 Soybean futures contracts, for accounts with common beneficial ownership.
bit.ly/2m58jz8
| | | | | | Strategy | | | Volatility Expectations Rise in August (Options LiquidityMatrix)
TABB Forum
As part of our expanding coverage of the options and options on futures markets, TABB Group has added a feature to the monthly Options LiquidityMatrix that explores volatility trends in the most actively traded markets. August was a volatile month for most markets, and options on futures volumes confirmed this. Exhibit 1, below, shows that most macro markets experienced a significant increase in volatility expectations in August compared to July.
bit.ly/2Fn6C7t
Citigroup Advises Bearish Bet on Stocks, Funded by Oil Options
Cormac Mullen - Bloomberg
Investors should take advantage of the surge in oil prices to finance bearish bets on the U.S. equity market, according to Citigroup Inc.
The recent attack on Saudi Arabian crude production sent oil volatility soaring to above-average levels, making it more attractive to sell put options on the commodity -- if you believe prices will continue to rise, said strategists including Jeremy Hale in a note Thursday. The proceeds could then be used to buy protection against a sell-off in stocks, where volatility is below average and downside risks remain, they said.
/bloom.bg/2Nqf23s
ETJ: Hedge Yourself Against Economic Volatility With This CEF
Seeking Alpha
Over much of the course of this year, we have seen a growing amount of uncertainty about the future of the economy. This uncertainty has been reflected in the markets, which have been very volatile. Indeed, anyone that has watched the performance of the S&P 500 since early May would attest to this. If we include the performance that we saw in the fourth quarter of 2018, then this uncertainty becomes even more apparent. As such, it may be a good idea to begin hedging your portfolio and accumulating assets that should perform well regardless of what happens in the broader economy. One of the easiest ways to do this is by purchasing shares of the Eaton Vance Risk-Managed Diversified Equity Income Fund (ETJ), which is a closed-end fund that is specifically designed to deliver a reasonable amount of income to its investors no matter what the broader market does.
bit.ly/2NoMw1V
| | | | | | Miscellaneous | | | Almost 39 per cent of hedge fund managers willing to negotiate management fees, says report
Hedgeweek
Many hedge fund managers are willing to negotiate lower management fees with investors, but far fewer are willing to budge on performance fees, according to a new report from eVestment.
bit.ly/2NqQhDW
Do Traders Need to Code? Goldman Sachs CIO Marty Chavez Says Yes
Sonali Basak - Bloomberg
Just how important will the ability to write computer code be to a successful career on Wall Street?
According to R. Martin Chavez, an architect of Goldman Sachs Group Inc.'s effort to transform itself with technology, "It's like writing an English sentence."
/bloom.bg/30wIerh
| | | | | | | | | JLN Options is sponsored by: | | | | | | | | | | | | | | | | | | |
|
|
| | | |
| | | | 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
Publisher | | | Sarah Rudolph
Editor-in-Chief
| | | Jeff Bergstrom
Editor
| | | Matt Raebel
Editor
| | |
|
|
Disclaimer: All John Lothian Newsletters, JohnLothianNews.com, MarketsWiki.com and MarketsReformWiki.com are products of John Lothian News, a division of John J. Lothian & Company, Inc. The opinions expressed in all John J. Lothian & Company, Inc. publications are strictly those of their respective editors. They are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Security futures are not suitable for all customers. Futures and options trading involve risk. Past results are no indication of future performance. Nothing on any John J. Lothian & Company site should be considered an endorsement by any sponsor of any website or newsletter content.
© 2019 John J. Lothian & Company, Inc. All Rights Reserved. |
|
|
