 | | | | | | | | December 11, 2024 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | It's a New Era for Options. What to Expect in Trump's Second Term.; For a long time, it was possible to successfully trade options without any special knowledge of implied volatility. That's about to change.
Steven M. Sears - Barron's
Making money trading options has been easy for a long time. Anyone who picked a hot stock, then bought a call or sold a put, tended to succeed.
All that could change when Donald Trump returns to Washington. His second administration is widely expected to benefit markets, but dealers and investors are likely to struggle, at least initially, to determine how tariffs and other protectionist policies will impact earnings-and thus stock prices. Another wild card: sending illegal immigrants en masse back to where they came. As they often work for less money, they are thought to reduce inflation.
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More futures, options to be accessible; Nation's capital market eyes upping investment choices for foreigners
Shi Jing - ChinaDaily
Further opening-up of the Chinese capital market and deepening cooperation with multilateral financial institutions will not only bolster the country's high quality economic growth, but also provide more opportunities outside the country, said experts.
China will steadily include more futures and options that can be directly traded by overseas investors. Commodity futures and options accessible to qualified foreign investors (QFIs) will also be expanded in an orderly manner.
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BofA Warns Stocks Underpricing Risk of Inflation Return; Options imply smaller post-CPI S&P 500 move than recent trend; Market may be underpricing potential risks in inflation data
Michael Msika and Jan-Patrick Barnert - Bloomberg
While the fight against inflation may largely have been won, tensions over price pressures could still disrupt confidence about interest-rate cuts. The stock market seems to be looking past these warnings. Equities have flourished in the favorable "Goldilocks" conditions of a resilient economy, falling inflation and rate cuts. Yet there are worrying signs in price movements, while reflationary expansionist fiscal policies could pose a risk to the easing cycle. Tariffs under Donald Trump's administration threaten to bump up inflation projections for next year. For the moment, all eyes are on Wednesday's US consumer price index figures.
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How Booming Leveraged Funds Can Incinerate Your Money; Variants soon might include long-short funds resembling steel-cage matches
Jonathan Weil - The Wall Street Journal
There is great appeal in the notion of a simple investment product that can reliably provide double or triple the returns of a popular stock or index. The results have been disappointing, vaporizing billions of dollars, but Wall Street keeps finding plenty of eager buyers. Leveraged exchange-traded funds are having a moment about two years after the first leveraged single-stock ETFs were introduced in the U.S. They typically use derivatives to seek magnified gains. That also will magnify losses. Through November, the size of these funds in the U.S. grew 46% this year to about $137 billion, according to Morningstar Direct. About $20 billion of them were single-stock funds, up 11-fold year to date.
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There's Just 1 Big Bitcoin ETF Winner-and It's Ahead by a Lot
Ian Salisbury - Barron's
The race to become the go-to Bitcoin exchange-traded fund appears to have a runaway winner. And when it comes to ETFs, investing in the biggest, most heavily traded fund is usually the best option. ETFs that track the spot price of Bitcoin have become a huge hit since the Securities and Exchange Commission gave them the green light in January. Today, the funds hold more than $115 billion worth of the cryptocurrency, according to FactSet.
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Hedge-Fund Startups Dwindle as Managers Battle Pressure on Fees; Number of new launches heads for lowest annual tally: Preqin Investor appetite cools as big money seeks returns elsewhere
Lu Wang - Bloomberg
The near-$5 trillion hedge fund industry is having one of the toughest years in decades in convincing fee-conscious investors to fork out cash for new market players. Despite a spirited pickup in inflows over the third quarter, the challenge is evident in the dwindling number of freshly launched funds and a drop in performance fees. According to the latest report by data provider Preqin, a total of 123 firms opened up shop this year through September - poised for the smallest annual tally of new entrants since at least 2000. Meanwhile even as management fees across the industry ticked up, performance compensation over the period slumped by the most since 2010.
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Wall Street Commodity Traders Set for Worst Year Since Pre-Covid; Combined net revenue seen dropping nearly 20% to $10.6 billion; Market volatility has eased after Covid-19 and war in Ukraine
William Shaw and Archie Hunter - Bloomberg
The world's biggest banks are heading for their worst year in commodities trading since before the pandemic as years of lucrative volatility ease off. More than 250 firms including Goldman Sachs Group Inc., Citigroup Inc. and JPMorgan Chase & Co. are forecast to see combined net revenues of $10.6 billion in 2024, shaving nearly a fifth off of last year's total, according to data compiled by Coalition Greenwich, one of the top data providers on Wall Street. Market turbulence has subsided after Covid-19 restrictions and Russia's invasion of Ukraine shredded supply chains and triggered whipsaw price moves. The trading boom "is now fading," said Angad Chhatwal, head of global macro markets at Coalition Greenwich, which estimates revenue will slip a further 3% in 2025.
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Direxion launches new leveraged ETFs tied to Palantir, Berkshire Hathaway
Suzanne McGee - Reuters
Direxion said on Wednesday that it has launched new leveraged and inverse exchange-traded funds tied to two stocks, Palantir Technologies and Warren Buffett's Berkshire Hathaway that offer traders a chance to get twice the daily upside movement of each stock or capture the inverse of a daily decline.
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| | | | | | Exchanges | | | Abaxx to Launch Nickel Sulphate Futures on January 10, 2025
Abaxx
Abaxx Technologies Inc. (CBOE:ABXX)(OTCQX:ABXXF) ("Abaxx" or the "Company"), a financial software and market infrastructure company, indirect majority shareholder of Abaxx Singapore Pte Ltd. ("Abaxx Singapore"), the owner of Abaxx Commodity Exchange and Clearinghouse (individually, "Abaxx Exchange" and "Abaxx Clearing"), and producer of the SmarterMarkets⢠Podcast, today announced that it will launch Nickel Sulphate futures, the first of its battery metals products, on January 10, 2025.
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Cboe Global Markets Announces Date of Fourth-Quarter 2024 Earnings Release and Conference Call
Cboe
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, will announce its financial results for the fourth quarter of 2024 before the market opens on Friday, February 7, 2025. A conference call with remarks by the company's senior management will begin at 7:30 a.m. CT (8:30 a.m. ET). A live audio webcast for the conference call and the presentation that will be referenced during the call will be available on the Investor Relations section of Cboe's website at ir.cboe.com under Events. The presentation will be archived on the company's website for replay. A replay of the recording is expected to be available two hours after the conference call ends. To listen to the live conference call via telephone, please dial (800) 715-9871 (toll-free) or (646) 307-1963 (toll) and use the Conference ID 5196331.
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CME Group Announces 2025 Annual Meeting Date
CME Group
CME Group, the world's leading derivatives marketplace, today announced it will conduct its 2025 annual meeting of shareholders at 10:00 a.m. Central Time on Thursday, May 8, 2025. Additional information will be provided in the company's proxy statement.
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Nasdaq Announces End-of-Month Open Short Interest Positions in Nasdaq Stocks as of Settlement Date November 29, 2024
Nasdaq
At the end of the settlement date of November 29, 2024, short interest in 3,065 Nasdaq Global MarketSM securities totaled 11,857,580,215 shares compared with 11,973,515,318 shares in 3,070 Global Market issues reported for the prior settlement date of November 15, 2024. The end-of-November short interest represents 2.36 days compared with 2.25 days for the prior reporting period. Short interest in 1,665 securities on The Nasdaq Capital MarketSM totaled 2,052,759,872 shares at the end of the settlement date of November 29, 2024, compared with 2,044,997,906 shares in 1,668 securities for the previous reporting period. This represents a 1.00 day average daily volume; the previous reporting period's figure was 1.00.
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| | | | | | Strategy | | | The Dynamics of Delta Neutrality and Rolling
tastylive (Video)
The episode discusses delta neutrality and rolling in options trading, emphasizing the importance of maintaining a delta neutral position initially, which lacks directional risk. It explains how underlying stock movements can shift this neutrality, necessitating adjustments or rolls to align with market conditions. Strategies like strangles and iron condors help manage volatility risk. Positions gain or lose directionality as stock prices move, requiring adaptive tactics. E-mini S&Ps show potential gains, while other indices show mixed performance.
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Navigating Crypto Volatility with Smart Tactics
tastylive (Video)
The episode mainly covers humorous and casual banter among financial enthusiasts, touching on various topics from current events to market forecasts. Key discussions include speculation on Oracle's stock performance post-earnings, short-dollar positioning based on Morgan Stanley's analysis, crypto volatility, and general market sentiment around U.S. inflation reports. Additionally, there are mentions of unique trading strategies like the Dynamics of Delta Neutrality and updates on the daily show schedule with market insights.
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Investors Should Hold Bitcoin 'But Not Too Much,' Peterffy Says
Sally Bakewell - Bloomberg
Thomas Peterffy, the billionaire founder of retail brokerage Interactive Brokers Group Inc., said investors should own some Bitcoin though limit their holdings given the asset's volatility.
"I would recommend that people put maybe 2% to 3% of their net worth into Bitcoin," he said Wednesday in a Bloomberg Television interview. "We for example will not allow anyone to invest more than 10% of their assets into Bitcoin because I think that would be very dangerous."
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Here's three things to watch when the central banks of the eurozone and Switzerland meet on 'Super Thursday'
Jamie Chisholm - MarketWatch
The European Central Bank and Swiss National Bank will deliver monetary policy decisions on Thursday. The SNB's announcement is due at 9:30 a.m. local time (3:30 a.m. Eastern U.S.), with a press conference to follow at 10 a.m. The ECB's statement will come at 2:15 p.m. local time and a press conference will be held 30 minutes later.
Here are the three things to watch.
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Bitcoin Celebrates a "Champagne Moment" - What Lies Ahead?
CoinDesk via Business Insider
It has been a whirlwind. Bitcoin surpassing $100,000 may have been the champagne moment, but the digital asset class has had much to cheer about and digest since the Fed's easing cycle began on September 18, and even more since the U.S. election.
New incoming leadership at the SEC and other regulatory agencies, blockchain-savvy cabinet appointees, a new "AI and Crypto Czar," and frequent mentions of bitcoin and crypto by the President-elect all point towards more support for the industry from the U.S. government.
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| | | | | | Miscellaneous | | | The criminal's 'go-to cryptocurrency' has a new friend in the White House; Howard Lutnick has defended the stablecoin company which has been used by gangs and US adversaries
Miles Johnson, James Fontanella-Khan, Alex Rogers and Joe Miller - Financial Times
In July, Howard Lutnick, the pugnacious boss of broker Cantor Fitzgerald, regaled an audience of crypto devotees in Nashville with tales of his early days exploring the world of digital currencies.
"I met every criminal who's now in prison," the 63-year-old joked, referring to his encounters with various youthful crypto executives now serving lengthy jail sentences for fraud. "And then," he said, "I met the people who owned Tether."
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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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