| August 12, 2021 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |
Remembrances of Wayne Luthringshausen
JohnLothianNews.com
Here is a list of remembrances of the life of Wayne Luthringshausen, the retired chairman and CEO of the Options Clearing Corporation:
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| | | | | | Lead Stories | | | Optiver Airs Concerns on Options Market Structure
Anna Lyudvig -Traders Magazine
The significant concern in the US equity options market is the underpinning market structure, which favors the wholesalers with an affiliated market making arm, according to Optiver.
On August 11, Optiver, a proprietary trading firm and market maker for various exchange-listed financial instruments, released a series of papers highlighting concerns about the state of the U.S equity options market.
Optiver followed closely the SEC's recent remarks on payment for order flow (PFOF) and the agency's review of the equity market.
/bit.ly/3CJm61h
Tornado CEO: There's a 'crisis in investing education'
Julia La Roche - Yahoo Finance
There's a "crisis in investing education," according to mobile trading app Tornado's CEO and co-founder Bernard George. "Every week, there are headlines about young investors, gambling on penny stocks and options, and even bankrupt companies. And our view is that the only way to really solve that problem is to make smart investing highly engaging, so it becomes that path of least resistance for people," George told Yahoo Finance Live on Tuesday.
/yhoo.it/3fTDW7R
*****JJL: We did not have these problems when only the elite could invest.
Crowding Risk Hits Record as Hedge Funds Pile Into Same Stocks
Lu Wang and Melissa Karsh - Bloomberg
While hedge funds are retreating from a record-setting equity rally, their faith in their own stock-picking skills is growing stronger than ever.
The boldness is on display in data compiled by Morgan Stanley's prime broker unit. The firm's hedge-fund clients have boosted holdings in their conviction buys, with the 50 most-crowded stocks making up more than 40% of the long book last month for the time since at least 2010.
/bloom.bg/3yHgsdP
High-Speed Trading Firm Jump to Execute Retail Investors' Stock Trades
Alexander Osipovich - WSJ
Jump Trading Group, one of the world's largest high-frequency trading firms, will launch a unit that executes stock orders for individual investors, a business that has grown more lucrative for electronic traders as meme-stock mania has fueled a surge in U.S. retail volumes.
Executives at Jump told The Wall Street Journal that the firm is setting up a so-called retail wholesaler business. Wholesalers fill buy and sell orders for the customers of online brokerages such as Robinhood Markets Inc. and TD Ameritrade.
/on.wsj.com/3AAERSK
Tesla short-seller no longer 'hostile' to Elon Musk's 'bulls--t'
Lydia Moynihan - New York Post
Tesla short-seller Carson Block slammed Elon Musk as a "liar" for years â but now he's come to develop a "newfound understanding" of the Tesla CEO's "bulls - t."
In a colorful letter obtained by The Post â Block's first missive to investors since starting Muddy Waters Capital six years ago â the hedge fund manager said he's done with buying put options betting the electric-car maker's shares will decline. Those bets went to "Heaven" after "the Fed loosened in response to COVID" last year, he said.
/bit.ly/3jOE61N
| | | | | | Exchanges | | | HKEX to Introduce Options on Futures Contracts
HKEX
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Thursday) the launch of physically settled Options on Futures Contracts (OOF) on Hang Seng Index Futures and Hang Seng China Enterprises Index Futures. These new contracts will further enhance HKEX's derivatives product suite and add to the breadth and depth of Hong Kong's markets.
These new OOF will be introduced on 23 August 2021 and will offer investors a suite of new trading and risk management tools. Investors holding OOF will have the opportunity to take a futures position on HKEX's markets prior to the settlement of the underlying futures contract.
/bit.ly/3CGRT2X
Eurex is further extending its footprint in Latin America
Eurex
MSCI Brazil Futures to focus on largest market in Latin America. MSCI China Index Futures will replace MSCI China Free Index Futures
Eurex, the leading European derivatives exchange, will launch futures on the Latin American benchmark index MSCI Brazil. The derivatives arm of Deutsche Börse Group is responding to growing demand for investment and trading instruments focused on the Latin American region. The launch of the new contracts is scheduled for 6 September.
/bit.ly/3jMBBwV
The QDP Difference
Oliver Sung - Cboe
Cboe's Quote Depletion Protection (QDP) is a patent-pending, optional instruction that market participants can use in conjunction with Midpoint Discretionary Orders (MDOs) on Cboe's EDGX and EDGA Equities Exchanges. When activated, QDP disables an MDO's discretionary range for a short period when the exchange's quote indicates the price may move in a manner that could result in a more aggressive execution price. Since Cboe launched QDP in June 2020, our North American Equities Execution Consulting Team has monitored how market participants appear to use it and has continued to evaluate potential enhancements. Cboe believes QDP remains a beneficial tool for market participants, especially those using certain strategies.
/bit.ly/3fV366o
New York Stock Exchange to Require Vaccine on Trading Floors
Katherine Doherty - Bloomberg
The New York Stock Exchange will require Covid-19 vaccines for everyone entering its trading floors, joining the ranks of firms taking a more cautious approach amid a new wave of coronavirus cases.
The mandate is set to take effect Sept. 13, Chief Operating Officer Michael Blaugrund said Wednesday in a memo seen by Bloomberg. The policy covers anyone with access to the NYSE and American Options trading floors, including member firms, employees and vendors.
/bloom.bg/3CKrEZm
| | | | | | Regulation & Enforcement | | | China regulators step up risk control over popular Snowball derivatives - sources
Reuters
China's securities watchdog has tightened scrutiny on a popular derivative product dubbed Snowball, three sources told Reuters, as regulators seek to rein in risks in an opaque, $60 billion market.
Snowball, which offers a risky bet on stock market volatility and delivers double-digit, annualised returns barring a market tumble, has gained popularity among yield-hungry investors.
/reut.rs/3m5PGYO
| | | | | | Technology | | | BOX Options Market: New 1Gigabit Version Of The High Speed Vendor Feed
BOX Options Market LLC
BOX Options Market LLC ("BOX") will launch a 1Gigabit version of the Level 1 (Top of Book) High Speed Vendor Fee ("HSVF") Multicast to give Participants an additional connectivity option to receive market data from BOX.
/bit.ly/3fYoM1d
Delta Exchange to Simplify Bitcoin Options Trading With Automated Product
Sebastian Sinclair - Coindesk
Delta said its "Enhanced Yield Product" allows users to avoid high-risk scenarios without the need to learn complex options strategies.
Cryptocurrency derivatives platform Delta Exchange has introduced a feature it says will help generate passive income for its users through the use of automated call options.
Delta claims that its "Enhanced Yield Product" will simplify the process of bitcoin (BTC, -4.84%) and ether (ETH, -6.29%) options trading, according to a press release Delta Exchange shared with CoinDesk on Thursday.
/bit.ly/2XeuMwi
| | | | | | Strategy | | | Opinion: The ultimate bull case for the stock market: It keeps making new highs
Lawrence G. McMillan - MarketWatch
The broader stock market, as measured by the S&P 500 Index, continues to plow ahead, making a series of all-time intraday and closing highs.
This comes despite a nagging negative divergence with some of the market internals. But since "price is king," one must respect the strong positive action of the S&P 500 SPX, 0.10%. The Index has support at 4370 points, which has been doubly tested, and as long as that is in place, negative divergences make little difference; it is necessary to be long in line with the positive trend of the chart.
/on.mktw.net/3lXGKol
| | | | | | Events | | | Regulatory developments in the Asia-Pacific region19 August 2021 ⢠9:30 AM - 11:00 AM SGT
FIA
The Asia-Pacific region has seen a few significant regulatory developments in recent years which have affected the exchange traded derivatives marketplace. From China's steps to open its market to the increase in ESG regulations and the growing proliferation of digital assets, commercial and legal practices need to be realigned to fit this dynamic environment. Our panel of experts will share their views on key developments and their impact and provide insights on what regulatory trends they see in the horizon.
/bit.ly/2VIChvm
IDX â the International Derivatives Expo â is the place to be, bringing together industry leaders, vendors and policymakers to discuss what's "now" in derivatives, and what lies ahead.
IDX
Join us for two full days of outstanding programming, networking and exhibits from 27- 28 September. We're creating a unique IDX experience that will keep you safe while allowing you to connect with clients, colleagues and friends from the local cleared derivatives community. Register now to take advantage of special rates that end 27 August.
/bit.ly/3xHNskw
| | | | | | Miscellaneous | | | GameStop's Power Player: How Outsider Ryan Cohen Wrested Control
Sarah E. Needleman - WSJ
It took just a few months for a 36-year-old entrepreneur to take over America's most talked-about companyâand make $1 billion for himself in the process.
Ryan Cohen rose to become chairman of GameStop Corp. with the verve of an old-school corporate raider. Wielding little more than a minority stake and a sharp tongue, Mr. Cohen pushed out GameStop's executive team and installed longtime associates on the company's board. The tactics made the co-founder of online pet store Chewy Inc. a favorite of the individual investors who sent GameStop's stock on a roller-coaster this year; they call him "Papa Cohen."
/on.wsj.com/3fUpBYP
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