| February 28, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | We published John's Take and and the Term of the Week for The Spread late this week, but for good reason. We are announcing that Euronext has granted us the use of videos from the Euronext Knowledge Center, which feature many different options related videos, for our Term of the Week series. In John's Take, I introduce the Euronext Knowledge Center and Euronext TV, noting that many exchanges took time during the pandemic to improve their online video market education offerings. Euronext has released 41 videos on their YouTube channel since it was introduced less than a year ago.
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Ukraine- Russia Conflict Affects Market; ICE Executive David Goone becomes tZERO CEO; FTX Enters Gaming
JohnLothianNews.com
"Alex Perry's Optionstopia" takes a look at this week's options news highlights: Ukraine- Russia Conflict Affects Market; ICE Executive David Goone becomes New tZERO's CEO; FTX Enters Gaming
Watch the video »
| | | | | | Lead Stories | | | Fear of Unknown Spikes as Traders Face Bouts of Volatility
Thyagaraju Adinarayan - Bloomberg
Volatility index surges as West tightens sanctions on Russia; Morgan Stanley recommends defensive stocks amid growth worries
Russia's intensifying invasion of Ukraine has sent investors rushing for cover. And the moves suggest volatility is here to stay. The Cboe Volatility Index -- the "fear gauge" for the S&P 500 -- jumped to the highest on a closing basis since January 2021, while Wall Street strategists recommended loading up on so-called defensive stocks such as utilities that aren't directly tied to how the economy is doing.
/jlne.ws/3sscPrf
Stock Bulls Buy the Dip as Goldman Warns of Liquidity Risk
Katherine Greifeld - Bloomberg
Money is still flowing into U.S. stocks at a prolific pace, but it's arriving into a market where liquidity is evaporating -- ramping up volatility for traders grappling with the war in Ukraine and imminent rate hikes.
Intraday swings have hit 2% and more as it gets harder to do business at the market's core. According to Goldman Sachs Group Inc., equity liquidity -- as measured by orders from market makers ready to transact on American exchanges -- has slumped to levels seen only three times in the last 15 years, based on S&P 500 E-mini futures order book data.
/jlne.ws/3BZxxBU
Nasdaq Heads for Biggest Two-Month Slump Since 2008 as Risks Pile Up
Ryan Vlastelica - Bloomberg
February probably hasn't felt like the shortest month of the year for investors in technology stocks, with constant volatility building on what was already the sector's worst start to a year since 2016. And it looks like the month will end on another gloomy note Monday.
Risks piled up, as rampant inflation underlined expectations of higher interest rates and Russia's invasion of Ukraine sent markets on a bumpy ride. The Nasdaq 100 Index is down 13.7% this year, including a 0.7% drop on Monday. It is poised for its biggest two-month slump since 2008 and its first back-to-back monthly declines since late 2020.
/jlne.ws/3tAl1p1
Korea Day Traders Pile Record Money Into Russia ETF Amid War
Youkyung Lee - Bloomberg
Risk-loving Korean mom-and-pop investors piled a record amount of money into a Russia-linked exchange traded fund as it sank following the invasion of Ukraine, prompting the ETF's operator to issue an alert.
Retail buying in the Kindex MSCI Russia ETF surged to 18 billion won ($15 million) on Friday, a nearly 900-fold jump from a week ago, according to data from Korea Exchange. Overall, the Asian nation's day traders bought an unprecedented net 24 billion won during the week through Feb. 25, the data show.
/jlne.ws/3pLuxVd
Tougher Sanctions Spark Russian Market Mayhem. It's Threatening to Spread.
Callum Keown - Barron's
More sanctions and more volatility are the order of the day.
Efforts by Western nations to financially cripple Russia were ramped up over the weekend, and the impacts are being felt across the markets Monday.
/jlne.ws/3HubuV6
| | | | | | Exchanges | | | Cboe Global Markets to Present at the Raymond James Institutional Investor Conference on Monday, March 7
CBOE
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, announced today that Ed Tilly, Chairman, President and Chief Executive Officer, Chris Isaacson, Executive Vice President and Chief Operating Officer, and Brian Schell, Executive Vice President, Chief Financial Officer and Treasurer, will present at the Raymond James Institutional Investor Conference on Monday, March 7 at 10:25 a.m. ET.
The webcast and replay of the virtual presentation will be accessible at www.cboe.com in the Investor Relations section, under Events and Presentations. The archived webcast is expected to be available within an hour of the presentation.
/jlne.ws/3ho7BXh
| | | | | | Strategy | | | Wall Street's Risky 'Razor Blade' Trade Is Making a Comeback
Denitsa Tsekova - Bloomberg
Ashley Howie sells houses at work, breeds butterflies in her spare time, and takes risks in her portfolio. "My parents are not in the stock market, and they're terrified for me," says the 31-year-old real estate agent from Pasadena, Calif. They'd probably be even more scared if they knew everything she was buying.
Howie is part of an army of pandemic-era retail investors powering a boom in leveraged exchange-traded funds and notes, investment vehicles that use financial derivatives to pump up returns. Like a normal ETF, these investments can be traded just like stocks and track the performance of an index. The twist is that they're designed to deliver two or three times the index's daily gain or loss, or even to pay the opposite return, allowing buyers to bet against the market. They're notorious for having gotten caught up in past market meltdowns, and regulators worry that many investors don't understand their risks. But amid meme-stock madness and crypto chaos, few on Wall Street seem to have noticed their resurgence.
/jlne.ws/36TJPk9
Opinion: If you're worried about a 'black swan' event sinking stocks deeper, here's how to manage the risk
Mark Hulbert - MarketWatch
The stock market's downturn over Russia's invasion of Ukraine sure looks like a black swan event, but it really isn't.
The term "black swan" describes an unlikely, rare occurrence, and it's often misused when it comes to investing. Not only is it inaccurate to describe recent market weakness as a black swan, doing so misleads investors about what is possible to achieve with strategies designed to protect against a genuine black swan.
/jlne.ws/3suvp2f
| | | | | | Miscellaneous | | | Vladimir Putin 'has lost this war - and so have markets,' Rabobank's global strategist says, as Russia's ruble craters and volatility hits stocks
Hamza Fareed Malik - Business Insider
Ukraine's stiff resistance to invasion and tough new sanctions mean military defeat for Russian President Vladimir Putin and don't bode well for markets, according to a top Rabobank strategist.
The ruble fell 30% to a record low against the dollar Monday, and global stocks tumbled, as traders assessed the impact of fresh measures imposed on Russia at the weekend.
/jlne.ws/3IHspF2
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