| August 26, 2024 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |  Trading Technologies' Strategic Integration: A New Era in Futures TCA JohnLothianNews.com In a recent interview at the FIA's IDX conference in London, Peter Weiler, executive vice president and managing director of data & analytics at Trading Technologies (TT), shared insights into the evolving landscape of transaction cost analysis (TCA) in the futures market. Weiler, who joined TT following its acquisition of Abel Noser Solutions, discussed the unique challenges and opportunities in the adoption of TCA, as well as its potential impact on competition between major exchanges like CME and FMX. Watch the video »
| | | | | | Lead Stories | | | An ETF that tracks the stock trades of Democrats in Congress has been beating the S&P 500 on the strength of Magnificent 7 tech bets
Matthew Fox - Business Insider via Yahoo Finance
An ETF that tracks the trades of Democrats in Congress and their spouses has outperformed the broader stock market since its launch last year.
The Unusual Whales Democratic ETF, which trades under the symbol "NANC" in a nod to former House Speaker Nancy Pelosi, has surged 30% since its launch on February 7, 2023. That compares to a gain of 24% for the S&P 500 over the same time period.
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Boaz Weinstein's Hedge Fund Has New Foes in War Over Closed-End Funds; NYSE asks SEC to delete closed-end-fund annual-meeting mandate; Weinstein's hedge fund calls the exchanges' efforts 'shocking'
Lydia Beyoud, Yiqin Shen, and Silla Brush - Bloomberg
BlackRock Inc. and other asset managers have new allies in their fight with activist hedge funds over control of the $250 billion closed-end fund industry. The New York Stock Exchange and Cboe Global Markets Inc. recently joined the cast of characters in this yearslong drama by asking the Securities and Exchange Commission to let them eliminate their requirements that closed-end funds hold annual shareholder meetings. Proponents say the change could lower fees and bring regulation in line with that of mutual funds and exchange-traded funds.
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Hedge Funds Dump Diesel as Supply Glut Tanks Futures Market; Net-long positions surge at four-year low: CFTC data; Prices collapse as supply glut collides with weak demand
Antonia Mufarech - Bloomberg
Investors have turned deeply bearish on diesel, with bets on falling prices surging to the highest level since lock-downs began in early 2020. Net-long positions on US diesel fell by 4,086 contracts to 24,548, a four-year low, according to CFTC data for the week ended Aug. 20. Meanwhile, bearish bets on gasoil fell by 26,875 net-short positions to 27,207 - the lowest in more than a year, according to ICE Futures Europe.
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PBOC Starts Bank Stress Tests to Avoid Stampede Out of Bonds
Bloomberg
China has initiated stress tests with financial institutions on their bond investments, to make sure they can handle any market volatility should a record-breaking rally reverse, according to state-run media. The People's Bank of China has made a gradual start to the tests recently, wary that a bull run might lead to one-sided bets in long-term government bonds, according to a front-page report by Financial News. Its intention may not necessarily be to significantly push yields higher, the central bank-backed newspaper said citing an unidentified source.
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Oil Volatility Pares a Short-Lived Pop as $75 Still a Floor
David Marino - Bloomberg
Oil's early-August pop in volatility has been quickly reversed, with the $75-a-barrel price level once again proving to be a sticking point for the Brent market.
The short-lived increase came as volatility in equities and other markets spiked suddenly. The broader risk asset sell off came amid concern that the Federal Reserve was waiting too long to ease interest rates and would cause the economy to overcorrect, crimping oil demand.
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Next-Gen ETFs Buck Vanguard Effect With Fees Near Decade Highs; Average fee for new funds is among highest in decades: BI; Growth of low-cost passive ushered in expensive, niche funds
Emily Graffeo - Bloomberg
The popularity of ultra-low cost passive ETFs is fueling a surprise shift in fund management: New entrants are getting pricier.
Tapping into the hunger for complex strategies hinging on everything from stock options to crypto to stand out in the marketplace, this year's new ETFs rank among the most expensive of the decade. That's a boon for fee-starved issuers.
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| | | | | | Exchanges | | | CME Group Opens Registration for its 21st Annual Global University Trading Challenge
CME Group
CME Group, the world's leading derivatives marketplace, today announced that registration is now open for the 21st annual CME Group University Trading Challenge, which will be held from Sunday, October 6, 2024 through Thursday, October 31, 2024. Interested students can register no later than 2 p.m. CT on Tuesday, October 2, where they can also familiarize themselves with the challenge rules and gain additional market knowledge through the wide range of resources available.
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Moscow Exchange announces results for the second quarter of 2024
MOEX
Moscow Exchange (MOEX) today announces its financial results based on summary financial statements prepared in accordance with International Financial Reporting Standards (IFRS) for Q2 2024. Unless stated otherwise, all figures below refer to performance in Q2 2024 and all comparisons are with the corresponding period last year.
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Delisting of all Options on Yen Denominated Nikkei Stock Average Futures Contracts
CME Group
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| | | | | | Regulation & Enforcement | | | FIA CEO testifies at House Agriculture Committee hearing
FIA
Walt Lukken, President and CEO of FIA, testified today at a US House Agriculture Committee subcommittee hearing on reauthorizing the Commodities Futures Trading Commission (CFTC).
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CFTC Staff Issues No-Action Letter for EU-Based and UK-Based DCOs Regarding Certain Requirements Applicable to DCOs
CFTC
The Commodity Futures Trading Commission's Division of Clearing and Risk (DCR) today issued a no-action letter to address the applicability of certain CFTC regulations to registered derivatives clearing organizations (DCOs) based in either the European Union (EU) or the United Kingdom (UK). This letter replaces CFTC Letter 16-26, which applied only to EU-based DCOs and was issued in 2016 as part of the CFTC's response to the EU equivalence determination with regard to the CFTC's regulatory framework for DCOs. [See CFTC Press Release No. 7342-16]
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SEC Issues Awards Totaling $98 Million to Two Whistleblowers
SEC
The Securities and Exchange Commission today announced awards of more than $98 million to two whistleblowers whose information and assistance led to an SEC enforcement action and an action brought by another agency. The first whistleblower's tip prompted the opening of the investigations, and thereafter provided critical additional information and ongoing assistance. As a result, this whistleblower will receive an award of $82 million. The second whistleblower, whose information was provided later, significantly contributed to one aspect of the actions and will receive an award of $16 million.
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| | | | | | Strategy | | | Equity Convexity Bid As Traders Position for Powell Pivot
Ed Tom - Cboe
WHAT STANDS OUT:
The three most actively traded US broad market benchmarks decoupled from their respective volatility counterparts last week as quantified by the following week over week changes:
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| | | | | | Education | | | Understanding the VIX index
Brian O'Connell, Paul Curcio and David Tony - CNN
On August 5, 2024, the Dow Jones Industrial Average fell more than 1,000 points in furious trading as Japanese economic news and fears of a market crash fed into the carnage.
While seasoned traders noted how the Dow performed that day, they were even more focused on a key market volatility indicator that provided a sharper view of market chaos - the Chicago Board Options Exchange (Cboe) Volatility Index, more colloquially known as the VIX.
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| | | | | | Miscellaneous | | | U.S. recession fears exaggerated, economists at Jackson Hole say; Fed seen cutting interest rates two or three times this year and then pausing
Greg Robb - MarketWatch
The U.S. economy is not expected to fall into recession, experts attending the Federal Reserve's summer retreat at the base of the Grand Teton Mountains in Wyoming say.
"The underpinnings of the economy look good. Broadly speaking, things look pretty solid," said Karen Dynan, an economics professor at Harvard University.
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