| April 27, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | The Options Conference held a nice event at the Wildhorse Saloon last night, with live music and instructions on how to line dance. Mrs. Lothian was right up there learning how to step and shimmy. It was a good event to network and we even snagged a couple more interviews for today at the event.
There is a lot going on in the options space, some of which people can't talk about yet, and some they can. One of the highlights yesterday for JLN was interviewing fellow journalist and former trader Mark Longo of The Options Insider for the Open Outcry Traders History Project. Alex Teng did the interview, his first for the series, and Mark was very forthcoming about his time as a trader.
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| Lead Stories | | | One-Day VIX Shows Market's Receding Fear of Inflation Data, Fed Decisions
Lu Wang - Bloomberg
As guarded as the reception has been to Wall Street's new fear gauge, the one-day VIX does appear to offer an interesting glimpse into a potential shift in the psychology of investors.
Namely, diminishing anxiety over macroeconomic events such as inflation data and Federal Open Market Committee's policy meetings, which previously had been big instigators of turbulence. The fading fear is demonstrated by the Cboe 1-Day Volatility Index (ticker VIX1D)'s performance around these catalysts over the past year.
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Wall Street Recession, Inflation Bets Will Cause Bond, Stock Market Chaos
Neil Dutta - Business Insider
A popular phrase among investors and analysts is "the bond market is always right." From predicting downturns to the Federal Reserve's next move, the bond market's historical forecasting track record and its "wisdom of the crowd" quality have given it a near-mythic reputation among Wall Street analysts.
Given that popularity, it's important in the economic-forecasting business to pick your battles with it wisely. That said, it's also important to acknowledge when the bond market is off base, because when the market's expectations run into a vastly different reality, things tend to go haywire â and investors can lose (or make) a lot of money depending on how they're positioned. And it's becoming increasingly clear that the bond market is reading the economic tea leaves all wrong.
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Opec accuses IEA of stoking 'volatility' in energy markets
David Sheppard - Financial Times
Opec has claimed the International Energy Agency's calls to halt investment in oil are triggering turmoil in energy markets, intensifying a war of words between producers and rich-world consumers.
Opec secretary-general Haitham Al Ghais accused the IEA, which is funded by the OECD group of rich economies, of "finger pointing" after the agency warned the surprise production cuts announced by the oil cartel earlier this month risked exacerbating inflation.
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Options Market: Strong but Not Without Challenges
Markets Media
The U.S. options market continues to show strength and resilience, enabling market operators and trade handlers to deliver a quality customer experience. But there are challenges pertaining to transparency, the rise of shorter-dated options, and the increasing number of exchanges. Those were themes articulated Wednesday afternoon on the Options Market Today panel at the Options Industry Conference in Nashville. The options market boomed in 2020-2021, largely driven by retail traders trading during the pandemic. That has leveled off, but institutional and ETF activity has remained robust, and infrastructure has improved.
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Celebrating 50 Years Of Publicly-Listed Options With Cboe
Cboe Global Markets
On April 26, 1973, Cboe Global Markets (BATS:CBOE) introduced the world to publicly-listed options with strikes and expiration dates. The financial markets were forever changed. Cboe Global Markets, Inc., Wednesday, April 26, 2023, Press release picture 50 years later, Cboe's innovation unlocked a new avenue for investing and hedging for hundreds of hedge funds and thousands of traders, and its innovation did not stop there. Cboe is responsible for the creation and perfection of most of the world's options products. It has produced eight kinds of Index Options, four volatility-derivative products (including the volatility index itself), two corporate credit and interest rate futures and countless other products like Cboe Minis, FLEX Options and LEAP options.
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IG Disagrees With Pattern Day Trading Rules
Anna Lyudvig - Traders Magazine
IG North America, an online derivatives trading provider, is working with the US regulators to modify rules around pattern day trading, according to CEO JJ Kinahan. "We're working with the Industry, attempting to modify this rule, to allow people who have lesser accounts to still participate in the market setup in a full way," he told Traders Magazine. The pattern day trader rule is a regulation set by the Financial Industry Regulatory Authority (FINRA), a trading governing body in the US, 'to discourage people from trading excessively'.
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| | | | | | Exchanges | | | More Investors Turn to Inverted Exchanges in Canada
Cboe Insights
Inverted markets have played a significant role in the growth of the Canadian Equity Market by increasing competition, reducing trading costs, and providing innovative products and services. Cboe Global Markets has increased its footprint in Canada to four trading platforms, which includes the inverted venue NEO-N. A previous analysis, Cboe's Equities Execution Consulting team took a deep dive into NEO-L, one of Cboe Canada's four trading venues. In this analysis, our team focuses on NEO-N, the overall inverted markets composition, and the concentration of subdollar volume on inverted venues. The unique trading mechanisms of NEO-N, including size-time priority and an asymmetric speedbump, have fostered a healthy taker-maker ecosystem. As a result, investors experience better execution quality and orders can efficiently interact with fewer latency sensitive liquidity takers on Cboe NEO-N.
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Tradeweb in talks to acquire Australian electronic trading platform Yieldbroker; If a definitive agreement is reached, Tradeweb anticipates that the acquisition would be an all-cash transaction with a purchase price of $82.7 million.
Wesley Bray - The Trade
Tradeweb Markets has announced that it is in advanced discussions to acquire Australian-based Yieldbroker, a government bond and interest rate derivatives trading platform covering the institutional, wholesale and primary markets. In a statement released on Wednesday, Tradeweb said it anticipates that the acquisition would be an all-cash transaction with a purchase price of $82.7 million.
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Regulator's Column: What boards and requisitionists should take note of in shareholder-requisitioned meetings
SGX Group
Introduction: Issuers are required, under the Companies Act 1967 ("Companies Act") and the SGX-ST Listing Rules, to hold a general meeting each year, known as the "annual general meeting". In addition to the annual general meeting, issuers may hold general meetings at any other point in a year. These are known as "extraordinary general meetings". The board of directors ("Board") is typically the party that calls for general meetings as the Board is statutorily allocated the power to manage the business of the issuer. Nevertheless, occasions may arise where shareholders may wish to draw certain matters to the attention of other shareholders.
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| | | | | | Regulation & Enforcement | | | SEC Chairman Gary Gensler says 'the law is clear' for crypto exchanges
Ari Levy and MacKenzie Sigalos - CNBC
SEC Chairman Gary Gensler has a message for Coinbase and other crypto exchanges: The rules are clear, and they must be obeyed.
In a video posted on Twitter on Thursday, Gensler said that crypto exchanges must treat cryptocurrencies like securities and stop acting as if the regulations are ambiguous.
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| | | | | | Technology | | | Cboe selects Broadway Technology as infrastructure provider for new interdealer US treasuries platform; Broadway will provide Cboe full-service co-location, cloud hosting and system oversight to improve the trading experience on Cboe's new trading platform.
Annabel Smith - The Trade
Cboe has selected Broadway Technology to become the infrastructure service provider for its new interdealer US treasuries trading platform. Announced in November 2021, the new platform - Cboe Fixed Income - is the exchange group's first move into fixed income. The dealer-to-dealer electronic trading platform claims to be the first ever full amount trading platform for on-the-run US treasuries trading meaning any incoming marketable order will trade in full against one counterparty.
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| | | | | | Strategy | | | 13 Moves to Make Before the Market Wakes Up to Risk
Nicholas Jasinski - Barron's
Doom and gloom are everywhereâeverywhere, that is, except the stock market. Don't expect the repose to last.
Since March's bout of regional bank-inspired volatility, stocks have been stuck in a tight range, daily trading volumes have tumbled, and the Cboe Volatility Index, or VIX, has slumped. Even renewed concerns about the stability of the banking system following First Republic Bank (ticker: FRC) earnings didn't have much of a lasting impact. The VIX spiked 11% on Tuesday, taking Wall Street's so-called fear gauge to around 18.5 points, up from around 16 last week, but still low by historical standards. It came just a day after the New York Stock Exchange saw its lowest full-day trading volume of 2023 on Monday, when the S&P 500 closed practically flat.
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'Sell' signals are flashing across the stock market now.
Lawrence G. McMillan - MarketWatch
The stock market, as measured by the S&P 500 Index SPX, +1.96%, has struggled to maintain the rally that began in mid-March, and now we are getting new sell signals from some of our internal indicators.
SPX was turned back by resistance near 4200 for the third time since last August. That is an extremely strong resistance area now. Moreover, there is further resistance at 4300. On the downside for SPX, there is technically support at 3970, where the small gaps exist on the SPX chart. A close below 3950 would be extremely bearish and likely generate a retest of the December 2022 lows at 3760.
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I'm an 86-year-old options trader. How do I make the most of my strategy?
Beth Pinsker - MarketWatch
MarketWatch recently posted about a day-trading strategy that produces a 46% annual return. I have been trading options for over 11 years. My strategy has achieved over 90% net annual return for years. I have not lost a trade in over five years. I do not day trade. I simply enter trades once per month with 20- to 30-day time durations. I'm 86 and a founder and CEO of several companies. Any suggestions for how to monetize my options strategy?
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| | | | | | Events | | | International Derivatives Expo
FIA
In the rapidly changing cleared derivatives environment, you have to have the right partners, products, processes and technologies in place to meet the needs of tomorrow. FIA's International Derivatives Expo (IDX) delivers the clearing firms, vendors and exchanges that are driving the growth of the cleared derivatives industry in Europe and around the globe. Find the partners and solutions to build your business and the information you need to successfully navigate regulatory and market developments.
Come to IDX - the crossroads of the industry - and find your path forward.
Registration is open! Register by 19 May for the best rates.
/jlne.ws/3KTMhHJ
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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
Publisher | | | Sarah Rudolph
Editor-in-Chief
| | | Jeff Bergstrom
Editor
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