| February 03, 2022 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | OCC January 2022 Total Volume Becomes Highest January on Record
| | | | | | Lead Stories | | | Meta slide drives 'insane' options volume as some bet on bounce
Saqib Iqbal Ahmed - Reuters
A plunge in the shares of Facebook owner Meta Platforms Inc(FB.O) fueled a surge of options trading on Thursday, with some investors positioning for a quick rebound in the company's stock.
With Meta shares down around 25%, over 1.4 million options contracts on the company had changed hands by 12:30 p.m. (1730 GMT).
That puts the options on track to finish the day with about 2.5 million contracts traded, compared with the previous record daily volume of 1.8 million contracts on Aug. 7, 2020, according to data from options analytics firm Trade Alert.
"It's pretty insane," said Henry Schwartz, head of product intelligence at Cboe.
/jlne.ws/35O6IVu
Cboe jumps on the mini options train; Cboe Global Markets will launch trading in a new cash-settled options contract from March to help retail investors gain exposure to the US equity market.
Laurie McAughtry - The Trade
Market infrastructure provider Cboe Global Markets has confirmed the planned launch of Nanos, a new one-multiplier, cash-settlement options contract that is a fraction of the size of a standard options contract. Designed to provide greater access to options trading for retail investors, and listed exclusively on the Cboe options exchange, the new contract will be available from 14 March subject to regulatory approval.
/jlne.ws/35OaYEv
GameStop Options Trading Snapshots: A Tale of Three Market Environments
SpiderRock
Let's take a walk down meme-ory lane. It is the end of January 2020 in Chicago, a month that averaged a relatively mild 34-degrees and not much snow (7.8 inches total). Meanwhile, 77,026 GameStop options were traded. The stock exhibited volatility by the standards of the time, starting the month above $6/share and ending the month below $4/share.
Fast-forward. It's the end of January 2021. It was a bit colder (a 32-degree average) in Chicago than the prior year and the city got much more snow (21.9 inches total).
In the month, 25,166,766 GameStop options were traded.
/jlne.ws/3rnVEXp
| | | | | | Exchanges | | | Cboe Plans to List SPX Tuesday, Thursday-Expiring Weeklys Options
CBOE
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, today announced plans to list S&P 500 Index Weeklys options with Tuesday and Thursday expirations in the second or third quarter of 2022, subject to regulatory review.
With these planned new listings, Cboe will offer SPX Weeklys options with expirations on every trading day of the week, providing traders with additional tools to help manage their short-term U.S. equity market exposure and execute trading strategies with even greater frequency, precision and flexibility.
The S&P 500 Index (SPX) options market is one of the most actively traded and liquid options markets across the globe. S&P 500 Index Weeklys (SPXW) are similar to standard monthly SPX options but are shorter-in-term, with weekly expirations.
/jlne.ws/34AeLER
OCC January 2022 Total Volume Becomes Highest January on Record
Year-to-date cleared contract volume through end of January up 6.4 percent year-over-year
OCC
OCC, the world's largest equity derivatives clearing organization, announced today that average daily volume for January 2022 was 44.9 million contracts, up 1.1 percent compared to January 2021. Total volume was 897.6 million contracts, up 6.4 percent compared to January 2021.
/jlne.ws/3J1wFiq
Miami International Holdings Reports January 2022 Trading Results; MIAX Exchange Group Sets Daily Volume Record; MIAX Pearl Equities Sets Market Share and Volume Records
MIAX
Miami International Holdings, Inc. today reported January 2022 trading results for its U.S. exchange subsidiaries - MIAX, MIAX Pearl and MIAX Emerald (together, the MIAX Exchange Group), and Minneapolis Grain Exchange (MGEX).
/jlne.ws/2K3gU18
CME Group Inc. Names Slate of Director Nominees
CME Group
CME Group Inc. today announced its slate of candidates for its board of directors for election at the company's annual meeting to be held Wednesday, May 4, 2022.
/jlne.ws/3oprn8H
CME Group Declares Quarterly Dividend
CME Group
CME Group Inc., the world's leading derivatives marketplace, today declared a first-quarter dividend of $1.00 per share, an 11% increase from the prior level of $0.90 per share. The dividend is payable March 25, 2022, to shareholders of record as of March 10, 2022.
/jlne.ws/3rqKkKh
Intercontinental Exchange Reports Fourth Quarter & Full Year 2021
Intercontinental Exchange
Intercontinental Exchange (NYSE: ICE), a leading global provider of data, technology and market infrastructure, today reported financial results for the fourth quarter and full year of 2021. For the quarter ended December 31, 2021, consolidated net income attributable to ICE was $1.5 billion on $1.8 billion of consolidated revenues less transaction-based expenses. Fourth quarter GAAP diluted earnings per share (EPS) were $2.70. Adjusted net income attributable to ICE was $760 million in the fourth quarter and adjusted diluted EPS were $1.34.
For the full year of 2021 consolidated net income attributable to ICE was $4.1 billion on $7.1 billion of consolidated revenues less transaction-based expenses. Full year 2021 GAAP diluted EPS were $7.18, up 90% year-over-year. On an adjusted basis, net income attributable to ICE for the year was $2.9 billion and adjusted diluted EPS were $5.15, up 17% year-over-year.
/jlne.ws/3IUVRHs
| | | | | | Regulation & Enforcement | | | SEC Response to Meme-Stock Mania Coming Next Week, Gary Gensler Says
Benjamin Bain and David Westin - Bloomberg
The Securities and Exchange Commission is set to consider new stock trading rules in what would be the Wall Street regulator's most direct response yet to last year's wild trading in GameStop Corp. and other meme stocks.
SEC Chair Gary Gensler said Thursday that the agency is preparing to take up a range of policy changes starting next week that would deal with issues raised by last year's market frenzy, including shortening the time it takes to settle stock trades.
/jlne.ws/3IYld7m
| | | | | | Strategy | | | Goldman Sachs (GS) Touts Options Trade Netting 15% on Wild Earnings Days
Lu Wang - Bloomberg
A popular volatility trade on Wall Street is netting historic gains as the likes of Facebook parent Meta Platforms Inc. and Spotify Technology SA misfire this earnings season.
Known as the straddle investing style, managers buy a bullish and a bearish options contract in a company five days before it reports -- and then sell both a day after the event. If shares move far enough in either direction to boost the price of either the put or the call, the strategy makes money.
/jlne.ws/34a0v5V
Options Trading Strategies to Weather Market Volatility
Marley Jay - Business Insider
Investors often struggle to make stock market volatility work in their favor. Barry Martin has learned how to make it profitable.
Martin's fund at Shelton Capital uses a mix of stock and options trades to book extra profits and minimize losses during market downturns. According to Morningstar, it's delivered annual returns of 11.3% for the last decade, beating nine out of 10 derivative income funds.
/jlne.ws/3si4CEM
Stay cautious about the S&P 500's 'monster oversold rally'
Lawrence G. McMillan - MarketWatch
The S&P 500 index had become very oversold about a week ago, after persistent selling for much of January. But then a monster oversold rally was unleashed, and the stock market is acting in somewhat "typical," albeit volatile, fashion.
These oversold rallies often carry to the declining 20-day moving average and sometimes slightly beyond. To wit, the S&P rose above its declining 20-day MA on Wednesday and carried through it by a small distance. There is also a declining trendline in SPX now, as marked in blue on the accompanying chart.
/jlne.ws/3rnusb9
| | | | | | Miscellaneous | | | Fear Is a Good Motivation for Fraud
Matt Levine - Bloomberg
One way to do fraud when you are pitching an investment is to lie about the investment. "Our thing has guaranteed 20% monthly returns with no risk," you say, and then you steal all the money. This is pretty common.
/jlne.ws/3sblddz
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