| August 30, 2021 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |
Fed's Powell Takes Center Stage; New Company Offers Options Solutions; Explaining Volatility Skew - The Spread - August 27, 2021
JohnLothianNews.com
â In this week's options news, the Fed's Jackson Hole pronouncements placate the markets; meme stocks take off on a lark; volatility skew rises as traders remain divided; bitcoin and ethereum options hunker down ahead of expiration and Eurex plans to launch a first.
â John's Take looks at a new options business with seasoned players.
â And Jermal Chandler kicks off this week's options "Term of the Week" with the important concept of volatility skew.
Watch the video »
| | | | | | Lead Stories | | | Options Turn Upheavals Into a Mid-Month Sure Thing for S&P 500
Yakob Peterseil - Bloomberg
What can you say about a stock market grown so predictable that even its bouts of chaos now occur at regular intervals? A lot, when options whizzes get involved. A mid-month storm of volatility has emerged as a semi-predictable occurrence recently, a presence once recognizable only to specialists but now drawing the attention of an ever-larger crowd on Wall Street.
/yhoo.it/3BnsCt5
A billionaire investor who called the 2008 crash says crypto is a bubble that will 'go to zero' and tells investors buy gold
Ethan Wu - Markets Insider
Legendary investor John Paulson, whose bet against the housing market in 2008 made him a billionaire, trashed crypto and recommended gold in a wide-ranging interview with Bloomberg TV.
"I would say that cryptocurrencies are a bubble," said Paulson, who last year quit the hedge fund business after netting his firm $20 billion. He described crypto as a "limited supply of nothing," referring to the fixed quantity that some coins have, including bitcoin's 21 million token cap - though others have no such limit.
/bit.ly/3gIJGli
Bitcoin Is 'Worthless,' Housing Bubble Billionaire Says. Just Don't Try Betting on a Decline.
Al Root - Barron's
Cryptocurrencies won't be the next "Big Short" even though they are "worthless," says a hedge fund manager who made billions betting against the U.S. housing market more than a decade ago.
In an interview with Carlyle Group founder David Rubenstein, John Paulson claimed that cryptocurrencies are a bubble. But he also acknowledged that he's not shorting them.
/bit.ly/3BnbNi0
Price discovery in markets not imperilled by index funds
Amin Rajan - Financial Times
Just before his death in 2019, index funds pioneer Jack Bogle worried that their relentless rise might not "serve the national interest".
His worries centred on both the excessive trading in exchange traded funds as well as the prospect of mega indexers â like BlackRock, State Street and Vanguard â controlling a big shareholder vote in leading US companies.
/on.ft.com/3kDR0zU
Natural Gas Options Point To Challenging Winter
Seeking Alpha
Summary
In late September, the October natural gas options contract expires, and November becomes the first available trading month.
The first indicator is that traders are positioning themselves for winter much earlier than usual: August 2021 looks set to become the most active August of all time in terms of natural gas options trading.
The winter of 2021 is particularly difficult to predict, as the volatility metrics suggest.
/bit.ly/3DtFzU1
| | | | | | Exchanges | | | CME Group Micro Futures and Options Surpass 1 Billion Contracts Traded
CME Group
CME Group, the world's leading and most diverse derivatives marketplace, today announced that more than 1 billion Micro futures and options contracts have been traded to date.
"Retail participation across CME Group continued to grow during the first half of the year, and our innovative, Micro-sized products help ensure that both individual and institutional clients can even more easily access our markets going forward," said Julie Winkler, CME Group Chief Commercial Officer. "We continue to work closely with the broker community to help educate market users of all sizes on the many benefits of Micro futures trading, including deep liquidity in global benchmark products across nearly every investible asset class."
/bit.ly/38pNZxv
Nodal Exchange and IncubEx Collaborate to Launch Ten First of Their Kind Renewable Futures & Options
Businesswire
Nodal Exchange and IncubEx announced today the upcoming launch of ten new Renewable Energy Certificate ("REC") futures and options contracts, adding to the world's largest suite of environmental products.
/bit.ly/2WAJkq4
NYSE US Exchanges To Close In Observance Of Labor Day
NYSE
In observance of Labor Day, the New York Stock Exchange, NYSE American Equities, NYSE Arca Equities, NYSE Chicago, NYSE National, NYSE American Options, NYSE Arca Options, and NYSE Bonds markets will be closed on Monday, September 6, 2021.
/bit.ly/3kouPO8
MIAXExchange Group Holiday Schedule - Labor Day 2021
Mondo Visione
Please be advised the MIAX Options Exchange, MIAX Pearl Options Exchange, MIAX Emerald Options Exchange and MIAX Pearl Equities Exchange will be closed on Monday, September 6, 2021 in observance of Labor Day.
/bit.ly/38sj6bU
How illiquid options are prone to manipulation
Palak Shah - The Hindu Business Line
Options that swing 200-2,000% intraday contribute higher trading volume
Options in India's stock market are highly illiquid and prone to price manipulation, data gathered by BusinessLine for three financial years (FYs) shows.
Options trading volumes on the National Stock Exchange (NSE) have grown to nearly ?50 lakh crore during FY22, which was just around ?8 lakh crore, three years ago. But the exponential volume growth is hugely built on intra-day price variation of 200 per cent to 2,000 per cent or more in a large number of options contracts, data shows.
/bit.ly/2V2d8va
| | | | | | Technology | | | CQG Announces Connectivity to Brazilian Exchange B3 for Trading and Market Data
CQG
CHICAGO and SÃO PAULO, Aug. 30, 2021 /PRNewswire/ -- CQG, a leading global provider of high-performance technology solutions for traders, brokers, commercial hedgers, and exchanges, announced today that it has added to its global network of exchanges B3, one of the world's largest financial market infrastructure companies.
/prn.to/3h4xZG7
| | | | | | Strategy | | | How to find meme stocks like GameStop and AMC: Your complete guide to spotting and profiting from hot stocks on social media and Reddit's Wall Street Bets
Markets Insider
Stocks have steadily advanced in 2021 as the economy rebounded from the pandemic, but the S&P 500's solid gains pale in comparison to those of previously left-for-dead companies like GameStop (GME) and AMC Entertainment (AMC).
Those long-suffering stocks shocked the world by spiking as much as 1,700% and 2,800%, respectively, and ushered in a new era of investing in what are now known as meme stocks.
/bit.ly/3kBAm3W
The Case For Managing Risk With Collar ETFs
Seeking Alpha
Summary
Collar strategies typically combine owning equity securities with buying an out-of-the-money (OTM) put option and selling an OTM call option on those same securities.
A collar bounds performance between a specific range through the options' expiration date. Downside is limited to the extent of the put option's strike price, while gains are limited to the call option's strike price. Depending on the collar design, the options contracts can be a net debit (meaning they cost money to implement), net credit (meaning they generate positive income), or zero cost.
/bit.ly/3yoOUZL
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| | | Jeff Bergstrom
Editor
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