| April 26, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
|
| | | | Observations & Insight | | | This morning Cboe Global Markets rang their opening bell in celebration of 50 years of options trading. It is not only 50 years for Cboe, or CBOE, but also for the options industry and the Cboe Clearing Corporation, which became the Options Clearing Corporation at the insistence of the SEC. Congratulations to Cboe and OCC on their 50-year anniversaries and all the pioneers that made it happen.
One of the key people who made it happen was the chairman of the Chicago Board of Trade when the idea of an equity options exchange was first brought to the CBOT board of directors. That man was William Mallers, Sr., a former employer of mine. I have written a piece this morning titled "A Forgotten Rogue Cbot Chairman Who Helped Launch The Cboe And The Options Industry" to tell his story and explain why I think he is a futures industry Hall of Fame member to me.
++++
A Forgotten Rogue CBOT Chairman Who Helped Launch the CBOE and the Options Industry
JohnLothianNews.com
In the late 1960s, there were two rogue candidates who ran for the role of chairman of Chicago's leading futures exchanges. One was Leo Melamed, head of the "Young Turks" at the Chicago Mercantile Exchange and the other was William Mallers, Sr. the youngest man ever elected chairman of the Chicago Board of Trade. This infusion of young blood into these stodgy organizations would transform Chicago's financial markets and change the course of its place in the global financial markets. Melamed would lead the creation of the International Monetary Market, a separate exchange that would later be rolled back into the CME. Melamed's accomplishments during his career are legendary.
Read the rest of the story »
++++
Options Discovery Episode 16: Intro to Algorithmic Trading; Experienced Algo Trader and Chief Investment Strategist at Blackthorne Capital Management Breaks Down Algo Trading for Options With JLN's Alex Teng
JohnLothianNews.com
In this episode of Options Discovery, Alex Teng introduces the concept of algorithmic trading in the world of options. Alex then sits down with Scott Morris, the chief investment strategist of Blackthorne Capital Management, to dig deeper into the history of algorithmic trading for options and how it is implemented today.
Read the rest of the story »
| | | | | | Lead Stories | | | How Options Trading and Cboe Changed the World
Steven M. Sears - Barron's
Fifty years ago, an options trade ignited a multidecade reaction that changed how everyone invests.
It is doubtful that any of the 120 or so people who gathered to watch the Chicago Board Options Exchange's opening on April 26, 1973, fully understood what had been unleashed.
/jlne.ws/41HXUIE
Black-Scholes at 50: how a pricing model for options changed finance; Formula supported the development of trading in the instruments after Chicago Board Options Exchange launch
Donald MacKenzie - Financial Times
Fierce hostility was the first reaction to the Chicago Board of Trade's proposal to set up an organised market in stock options in the early 1970s. There were "absolutely unsurmountable obstacles", said one Securities and Exchange Commission official, according to the Board's Joe Sullivan, who tells me that the same official went so far as to make the somewhat tasteless comparison that options were held in the same regard as "marijuana and thalidomide".
/jlne.ws/3oHSgrE
***** Longtime JLN subscriber Professor Donald MacKenzie in the FT.~JJL
Debt ceiling worries bubble up in US stock options market
Saqib Iqbal Ahmed - Reuters
Worries over a debt ceiling showdown are creeping into U.S. options markets, as investors grow increasingly concerned that lawmakers will be unable to hammer out a deal in coming weeks, potentially sparking stock volatility as a key deadline nears.
Although concerns related to raising the $31.4 trillion U.S. debt ceiling have been apparent in Treasury markets for a while, equities markets have been less fazed, with the S&P 500 doggedly holding onto a rally that has seen it gain 6% year-to-date.
/jlne.ws/41H2hE0
The stock market is quiet right now. Too quiet.
Joe Ciolli - Business Insider
The stock market is awfully quiet right now. Perhaps too quiet.
Price swings are muted no matter how you look at them. On a forward 30-day basis â something measured by the VIX, which is commonly referred to as the stock market's fear gauge â traders are expecting the lowest volatility in more than two years. On an actual realized basis, the past 30 days have also been the most placid since 2021.
/jlne.ws/41XAX42
| | | | | | Exchanges | | | Cboe Global Markets Celebrates 50th Anniversary with Reinvigorated Brand Identity and $500,000 in Charitable Donations
Cboe Global Markets
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, today marked its 50th anniversary and kicked off celebrations to honor five decades of innovation and growth. The company will commemorate its milestone anniversary with an Opening Bell and Closing Bell ceremony on its Chicago trading floor, award its first of five $100,000 charitable donations and launch a new creative brand campaign. Additionally, Cboe will host a series of events over the coming months in its offices around the globe, in honor of its deep heritage, customers, employees and alumni.
/jlne.ws/3Ly2qEe
Celebrating 50 Years of OCC
OCC (Video)
On this day 50 years ago, in the Board of Trade Building in Chicago's financial district, the Chicago Board Options Exchange (CBOE) was founded as well as its wholly owned subsidiary, CBOE Clearing Corp. â the predecessor to OCC. CBOE was the first U.S. exchange to trade listed options. On opening day, trading in options on 16 stocks began, and 911 total call options contracts were traded.
/jlne.ws/422Z7Ko
Our Origins: Disrupting the Status Quo
Cboe
Cboe was created in 1973 to deliver an entirely new asset class to the industry -- shaking up the status quo to bring solutions to more people. In the last decade, the company has acquired businesses that are disruptors, sharing Cboe's vision for creating a trusted, more accessible marketplace.
The company we are today looks quite different than the company we were in 1973. What started as a Chicago-centric options exchange is now the world's go-to derivatives and securities exchange network. We still know options better than anyone, but we also offer trading solutions and products in multiple asset classes, including equities, derivatives, FX, and digital assets. And while we're still proud to call Chicago home, we're present across North America, Europe and Asia Pacific.
/jlne.ws/41ZRXGP
FTX Sells LedgerX to Miami Exchange Owner for $50 Million; CEO of FTX vows to monetize assets to deliver recoveries; Deal subject to bankruptcy court approval in May hearing
Yueqi Yang and Katherine Doherty - Bloomberg
FTX has agreed to sell LedgerX, its crypto-derivatives platform, to the owner of Miami International Securities Exchange for about $50 million. LedgerX was one of the few solvent pieces of Sam Bankman-Fried's former empire. The deal would give the exchange, known as MIAX and owned by Miami International Holdings Inc., a registered platform to expand its presence in the crypto industry.
/jlne.ws/41GKywv
CME profit rises as volatility spurred risk hedging
Reuters
CME Group Inc (CME.O) on Wednesday posted first-quarter profits that beat Wall Street expectations, as traders turned to the exchange operator's hedging products to navigate market volatility related to worries about the banking sector and slowing macroeconomic growth.
The recent regional banking failures along with the U.S. Federal Reserve's continued rate hike cycle has roiled markets, pushing demand for hedging tools in an increasingly uncertain macroeconomic environment as investors try to dump risky assets.
/jlne.ws/421tLUE
Quarterly Results: For The Three Months Ended 31 March 2023
Hong Kong Exchanges
Nicolas Aguzin, Chief Executive Officer said: "The year has got off to a very good start, with HKEX reporting one of its best quarters ever. Our clear strategy, commitment to offering our customers around the world more choice and opportunity and our resolute focus on our unique strength of connecting China and the World, is producing results. Despite economic fragility impacting market volumes around the world, this quarter our derivatives market has gone from strength-to strength, we announced a range of important new strategic initiatives such as our new Specialist Technology Company listing regime and Stock Connect eligible stocks and trading calendar enhancements, and we welcomed a host of new issuers and products to our markets. As we look forward to the rest of the year, we will continue to execute on our strategy, ensuring that we are active proponents of global dialogue and connectivity, working with all our regional and international stakeholders to deliver shared sustainable success. We remain fully committed to prudently investing in our people, our operations and our markets, reinforcing our relevance and role at the heart of one of the world's leading international financial centres.
/jlne.ws/41YI9gf
| | | | | | Education | | | What Is Implied Volatility (IV)?
Adam Levy - The Motley Fool
Implied volatility (IV) is a metric that indicates how much the market expects the value of an asset to change over a certain period of time. IV is derived from options pricing. When options command more expensive premiums, it indicates greater implied volatility. You can use implied volatility to produce confidence ranges for the terminal price of an asset by a certain date.
Implied volatility is commonly derived from options pricing to indicate how much the market expects the price of the underlying asset to change over time. IV is expressed as the percentage change in the underlying asset price over one year.
/jlne.ws/3Hgy8mE
| | | | | | Strategy | | | VIX breakdown means stocks are set to break out, says Katie Stockton
Hakyung Kim - CNBC
Stocks could see solid gains in the near future as Wall Street's so-called fear gauge falls, according to Katie Stockton, founder and manager of Fairlead Strategies.
The CBOE Volatility Index, or VIX, fell last week to its lowest level since November 2021. The VIX is widely looked at by investors as a gauge of uncertainty in the market. It uses S&P 500 stock index options prices to measure the market's expectations of near-term volatility.
/jlne.ws/444hpNj
| | | | | | Events | | | Welcome to the Tradier & MIAX Trading Innovation Event!
Tradier
Discover how to transform market uncertainty into trading opportunities at the Tradier & MIAX Virtual Trading Innovation Event. Immerse yourself in an interactive learning experience, featuring in-depth discussions and insightful presentations on tackling market volatility.
Learn from the best in the business as they share their insights and expertise on navigating market volatility. At the Tradier & MIAX Virtual Trading Innovation Event, you'll have the opportunity to hear from a diverse lineup of accomplished speakers who have made their mark in the world of trading and finance. Register now and take the first step towards building your trading paradise. MAY 3RD 2023 | 11AM - 2PM EST
/lnkd.in/gsMVeFWq
| | | | | | | | | 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
| | |
|
|
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.
© 2023 John J. Lothian & Company, Inc. All Rights Reserved. |
|
|
