| August 28, 2024 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | Join JLN in Chicago for FIA's Futures & Options Expo from November 18-20. The event will offer insights and innovations to help you and your firm thrive in the evolving cleared derivatives market. Choose from four participation options: Full Conference, Single Day, Single Day Exhibits Plus, or Exhibits Plus. Register by August 30 for the best rates. Don't miss this opportunity to connect with industry experts and explore cutting-edge technologies. We look forward to seeing you this fall. Register HERE.
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Gary DeWaal Reflects on His Last Conference Before Retirement: Insights from Mexico
JohnLothianNews.com
Last week, the veteran attorney and Katten Senior Counsel Gary DeWaal headed south of the border for his final conference as an employee of an entity in the financial services space. He attended the Risk Management & Trading Conference produced by the RiskMathics Financial Institute in Mexico.
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Sally Duros - Toronto ESG Conference
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Shun Takato - JPX Market Innovation & Research
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| | | | | | Lead Stories | | | Options Point to Gains in Market That's 'Like a Beach Ball'; The S&P 500 Index could be up 2.4% by the end of September; Volatility sellers help stabilize the market, McElligott says
Jan-Patrick Barnert - Bloomberg
Trading in stock options shows that investors are positioning for gains following the August wobble.
The S&P 500 Index's call skew, a measure of how much traders are willing to pay for bullish exposure, is steepening fast, suggesting some urgency in grabbing bullish options after Federal Reserve Chair Jay Powell's dovish Jackson Hole speech, said Charlie McElligott, a Nomura cross-asset strategist.
/jlne.ws/3AGUZYp
S&P Election-Week Options Imply Greater Chance of Big Move Lower
David Marino - Bloomberg
Investors trying to gauge the sentiment toward equities around the US presidential election can now look directly at S&P 500 Index options linked to the period of the vote, in addition to Cboe Volatility Index futures. For months, there's been a persistent premium for October VIX futures, signaling expectations for heightened volatility in stocks in the wake of Election Day on Nov. 5. As of a couple weeks ago, traders can also monitor S&P 500 options for that period, and those are pricing in a greater chance of a large move following the vote.
/jlne.ws/3X6fBAM
US companies return to currency options to hedge election, macro risks
Laura Matthews - Reuters
U.S. corporations are turning to foreign exchange options again to protect their cash flow as they fear the U.S. presidential election and diverging central bank interest-rate policies could spark a period of currency volatility, bankers said.
Currency swings, which can hike costs, disrupt cashflows and dent earnings, are far less pronounced than from 2020 to 2022, making option hedges cheaper than before. Prices soared during the COVID-19 pandemic and as central banks started hiking interest rates to tame inflation.
/jlne.ws/3ADEJqO
Hedge Fund Arbitrage Tactic Sees Payoff in PDD's Record Plunge; Strategy involves buying convertibles and selling shares short; Gains on short position more than offset drop in bond price
Yiqin Shen - Bloomberg
PDD Holdings Inc.'s record stock slide delivered gains to a popular hedge-fund strategy that seizes on the disconnect between the stock and corporate-bond markets. The tactic is centered on convertible bonds, a type of debt that can be redeemed for shares under certain circumstances. It involves buying the debt - which gives the owner the equivalent of a call option allowing them to buy shares at the conversion price - and selling the company's shares short as a hedge.
/jlne.ws/3T32HlW
| | | | | | Exchanges | | | Nasdaq, CF Benchmarks File to Launch Bitcoin Index Options; Nasdaq Bitcoin Index Options will provide added transparency, accessibility and reliability to cryptocurrency ecosystem.
Traders Magazine
Nasdaq (Nasdaq: NDAQ), in partnership with CF Benchmarks, announced its filing with the Securities and Exchange Commission to list and trade Nasdaq Bitcoin Index Options (XBTX). Upon regulatory approval, investors will be able to manage positions and hedge investments in cryptocurrency through options, furthering the maturity and liquidity of the asset class.
/jlne.ws/4fZan2n
MIAX Exchange Group - Options Markets - Market For Underlying Security Used For Openings On MIAX Options, MIAX Pearl Options And MIAX Emerald Options For Newly Listed Symbols Effective Wednesday, August 28, 2024
MIAX
Please refer to the Regulatory Circulars listed below for newly added symbols and the corresponding market for the underlying security used for openings on the MIAX Exchanges. The newly listed symbols will be available for trading beginning Wednesday, August 28, 2024.
/jlne.ws/3Mm0hLt
CME Group to Launch Bitcoin Friday Futures on September 30
CME
CME Group, the world's leading derivatives marketplace, today announced it will further expand its cryptocurrency derivatives offerings with the introduction of Bitcoin Friday futures (BFF) on September 30, pending regulatory review. Sized at one-fiftieth of one bitcoin, these new weekly futures contracts will be cash-settled to the CME CF Bitcoin Reference Rate New York Variant (BRRNY) at 4:00 p.m. New York time every Friday. A new BFF contract will be listed every Thursday at 6:00 p.m. New York time for a Friday trade date, with market participants able to trade the nearest two Fridays at any given point. A Friday expiry allows these contracts to closely track the spot price of bitcoin, as well as help investors mitigate weekend price moves.
/jlne.ws/3MnoLnn
The low touch future of FX derivatives
Eurex
The accelerating integration of over-the-counter (OTC) and listed FX derivatives markets is a story of change on multiple fronts. While regulatory shifts triggered the futurization of FX, technology will be the force that sustains its momentum. Block trades and Exchange for Physicals (EFPs) are key to the growing interlinkage between OTC and listed FX markets. They create a bridge for sizeable trades sourced in the OTC FX markets to access the efficiencies offered by clearing in listed FX markets. As such, most major FX desks within banks are establishing low touch execution services for FX futures blocks and EFPs.
/jlne.ws/3MnXFMX
New ETF Options Classes
Montreal Exchange
Bourse de Montreal Inc. (the Bourse) and Canadian Derivatives Clearing Corporation (CDCC) hereby inform you that at the opening of trading on Wednesday August 28, 2024, the following new ETF option classes will be listed:
/jlne.ws/3XjfvXE
| | | | | | Regulation & Enforcement | | | Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Establish Fees for Industry Members Related to Reasonably Budgeted Costs of the National Market System Plan Governing the Consolidated Audit Trail for the Period From July 16, 2024 Through December 31, 2024
SEC
Pursuant to Section 19(b)(1) under the Securities Exchange Act of 1934 (the "Act")1 and Rule 19b-4 thereunder, 2 notice is hereby given that on August 15, 2024, Cboe EDGX Exchange, Inc. (the "Exchange" or "EDGX") filed with the Securities and Exchange Commission (the "Commission") the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.
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TotalEnergies Unit to Pay $48 Million Over Alleged Gasoline Futures Manipulation; The Commodity Futures Trading Commission said a TotalEnergies subsidiary tried to manipulate a gasoline benchmark after it took a short position in the futures market
Richard Vanderford - The Wall Street Journal
A unit of TotalEnergies, a major French oil-and-gas producer, will pay $48 million to settle a U.S. regulatory action after it allegedly attempted to manipulate a gasoline futures benchmark price by selling physical gasoline at below what buyers were willing to pay. The Commodity Futures Trading Commission on Tuesday said TOTSA TotalEnergies Trading in 2018 sold EBOB, a type of gasoline used in European cars, at prices lower than what buyers indicated they were willing to pay.
/jlne.ws/3Tae1wC
| | | | | | Strategy | | | Jobs Data
Cboe (Video)
In #Vol411, @JoeTigay discusses today's earnings from $NVDA and takes a look at historical periods when the Fed cut rates after its Jackson Hole Economic Symposium.
/jlne.ws/3MpQyDO
| | | | | | Miscellaneous | | | The number of bitcoin millionaires has soared 111% in the last year as the cryptocurrency rallies
Kelly Cloonan - Markets Insider
As crypto rallies, the number of bitcoin millionaires has more than doubled in the last year.
According to a new report from New World Wealth and Henley & Partners, the number of bitcoin millionaires has risen to 85,400, a 111% increase in 12 months.
/jlne.ws/4e24Xlj
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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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| | | Jeff Bergstrom
Editor
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