| April 26, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | Happy birthday to the Cboe today as they started trading on April 26, 1973. The history of this momentous day has been memorialized in a 20-page paper by Cboe Co-founder Joseph Sullivan, the Cboe's first president. The paper is part of the Securities and Exchange Commission History Society website.
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| | | | | | Lead Stories | | | Rumbling in Options Market Is Sound of Traders Rushing to Hedge
Lu Wang - Bloomberg
The only thing that isn't falling in markets is the price of protection -- complicating the lives of harried traders rushing to hedge.
The issue is particularly pronounced in equities, where the relative cost of loss-protecting put contracts is as high as its been any time in two years. The benchmark options index in the U.S., know as the VIX, on Monday briefly surged above longer-dated futures -- a relatively rare inversion that occurs when market volatility mushrooms.
/jlne.ws/3vOiZlU
CME Offers Aluminum Options Contracts Trading in Battle Against LME
Mark Burton - Bloomberg
The Chicago Mercantile Exchange will launch new aluminum options contracts next month, as it steps up a campaign to wrestle trading away from its London rival in the wake of a nickel-trading debacle.
CME Group has made major strides in its competition with the larger London Metal Exchange in recent years after strong growth in its copper futures and options contracts, and it's now looking to replicate that expansion in aluminum, the most widely used base metal. It's also been offering incentives to traders to boost its less-popular aluminum futures contract, seeking to capitalize on the controversial halt on trading in the LME nickel market last month.
/jlne.ws/3xV438r
Cross-Asset Volatility Spikes All Over the World on Growth Fears
Emily Graffeo - Bloomberg
Markets around the world are in the throes of volatility, as growth fears in China break out just as Wall Street grapples with ever-more hawkish monetary policy in the age of elevated inflation.
U.S. stock fluctuations measured by the Cboe Volatility Index, or VIX, spiked to the highest level since mid-March in Monday trading. Yields on 10-year Treasuries broke a three-week slump to trade as much as 14 basis points lower. A broad measure of currency fluctuations is near its highest in a month.
/jlne.ws/3kdflg3
TNS Announces Market Data Coverage for all US Equity Options Groups
TNS
TNSTransaction Network Services (TNS) can now enable firms to directly access market data from all US Equity Option Exchanges, providing reduced complexity and significant cost savings. This offering is achieved because of TNS' mutualized exchange connections and status as a registered data vendor with all 16 Equity Option Exchanges in the US. TNS has one of the fastest, commercially available fiber networks in the New York metro area. With complete access and control over routes, TNS' dedicated operations teams ensure network optimization via a combination of high capacity, ultra-low-latency and maximum uptime, delivered via fully diverse circuits. Dark fiber connectivity in the strategically important New York Triangle gives traders ultra-high-speed access to real-time, full depth of book, raw market data feeds.
/jlne.ws/36LUzB8
Schwab's Liz Ann Sonders Says Stock Volatility Is Helping Active Fund Managers
John McCorry and Tom Keene - Bloomberg
Charles Schwab & Co.'s Liz Ann Sonders says diverging fortunes between stocks are providing opportunities unseen in years for active managers to showcase their investing smarts.
"The playing field is much more level now active relative to passive," the firm's chief investment strategist told Bloomberg Television's Surveillance on Tuesday. "There is improving opportunity for active to add some relative performance here. That's not been the case for many years."
/jlne.ws/3vhBf8n
UBS Rides Trading Boom While Rich Clients Sit Out Volatility
Myriam Balezou and Marion Halftermeyer - Bloomberg
UBS Group AG leaned on traders at its investment bank to boost profit in the first quarter after its key wealth management business was hit by slowing client activity and rising costs.
The Zurich-based bank reported net income of $2.1 billion, compared with analyst estimates of $1.9 billion, after the volatility caused by Russia's invasion of Ukraine helped drive trading revenue to a record. Earnings at the private banking unit were less positive as a pullback by Asia Pacific clients contributed to a 19% drop in transaction-based income.
/jlne.ws/3vh6mAQ
| | | | | | Exchanges | | | CME Group to Launch an Aluminum Option Contract on May 23
CME Group
CME Group, the world's leading derivatives marketplace, today announced that it will launch an option contract on its physically-delivered Aluminum futures on May 23, pending regulatory review.
/bit.ly/3ya5yQr
| | | | | | Regulation & Enforcement | | | Regulators Voice Concerns Over Cryptocurrency and 'Ponzi Scheme' Dynamics
Jack Denton - Barron's
A number of high-profile global financial authorities have redoubled their calls for regulation of the digital-asset space this week and warned over the integrity of cryptocurrency markets.
Bringing the emerging digital-asset industry under the reign of lawmakers and regulators is continuing in the U.S. and Europeâbut progress remains slow as billions of dollars continue to flow into the asset class from institutions and individual investors.
/jlne.ws/3ENFE62
Top ECB Official Urges Crypto Crackdown to Avoid "Lawless Frenzy"
Hamza Fareed Malik - Markets Insider
A top ECB official called for international coordination to regulate the crypto sector and called for a crackdown on the market.
Fabio Panetta said the unregulated crypto market posed financial stability risks and policymakers should not leave it unchecked.
/jlne.ws/3KkgAF4
Market players push back on SEC proposals
Wesley Bray - The Trade
The latest proposals from the US Securities and Exchange Commission (SEC) under chairman Gary Gensler's campaign to improve transparency and increase investor protection in the markets are seeing pushback from industry players concerned over their impact.
/jlne.ws/37PmBfw
| | | | | | Technology | | | FTX.COM selects Eventus for global trade surveillance and risk monitoring on all of its markets
FTX.com
Builds on relationship established in December with FTX US for crypto spot, futures and options markets
Eventus, a leading global provider of multi-asset class trade surveillance and market risk solutions, and FTX.COM ("FTX"), a leading global cryptocurrency exchange, announced today that FTX has contracted with Eventus to deploy the firm's Validus platform for trade surveillance and risk monitoring on all FTX markets throughout the globe.
/jlne.ws/3kbk02c
| | | | | | Miscellaneous | | | Bitcoin Bear Market Could Make for 'Great Entry Point:' Exchange CEO
Vicky Ge Huang - Business Insider
The macro fears over faster rate hikes, higher interest rates, and tightening financial conditions have caught up with the crypto market after they caused a global equity market meltdown on Friday.
As of Monday afternoon, the total crypto market cap had retreated to $1.81 trillion, with major tokens including bitcoin (BTC) and ethereum (ETH) dropping to as low as $38,339 and $2,805, respectively, according to CoinMarketCap.
/jlne.ws/38szQ5K
Fidelity Is Offering a Bitcoin Option for Its 401(k) Plans
Brian Evans - Markets Insider
Fidelity Investments will allow customers to invest in bitcoin with their 401(k) plans later this year, becoming the first major retirement-plan provider to embrace cryptocurrency as a savings vehicle.
Customers will be able to put up to 20% of their savings into bitcoin, with other cryptocurrencies likely to be added later.
/jlne.ws/3MuvGt1
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