| February 15, 2022 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | Big Options Trade Hedges S&P 500 Plunge of Up to 20% by April
Elena Popina - Bloomberg
As the S&P 500 spent Monday struggling to rebound from last week's loss, one options trader took on a big position that profits should the pain get much worse.
Through a series of trades, someone established a wager that the largest exchange-traded fund tracking the S&P 500 Index will fall below $370 by April 22, or down 16% from Friday's close. It could fall further, the wager held, but not lower than $350, or almost 21% below Friday's close. The trader spent about $2 million for 40,000 contracts in a strategy known as a put butterfly spread.
/jlne.ws/3rPyzNs
Tech vendors rethink risk in era of surging options volume; As options volumes soar, technology vendors are thinking about new risks posed when legacy infrastructure meets increasingly complex markets.
Rebecca Natale - Waters Technology
The rise of retail platforms like Robinhood and the social media frenzy around so-called meme stocks have helped to drive Main Street options trading for the past year. Surging volume and volatility in these markets have introduced new kinds of risks, and vendors who offer trading solutionsâsuch as for market risk, order management, and clearingâbelieve that offering more modern, advanced technologies can help mitigate them.
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Currency Volatility's Aggressive Jump Is About More Than Ukraine
Vassilis Karamanis - Bloomberg
There's more than meets the eye when it comes to volatility in the currency market.
Investors have long anticipated the return of wide price swings in FX and not just because they trail volatility in the rates and stocks space. Policy makers scaling back on stimulus at different rates was expected to bring about a new regime where the relative calm in the major currencies in place since early 2017 would be no more.
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Trader Known as 'Big Shot' Battles Mystery Nickel Stockpiler
Alfred Cang - Bloomberg
In Chinese commodity circles, he's known as "big shot" -- the man who controls the world's largest nickel producer and isn't afraid to place big derivatives bets on where prices are headed next. Now Xiang Guangda has emerged at the center of a market drama that's fueling some of the largest price swings in years for a key ingredient in the fight against climate change.
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This is what it will take to drive the S&P 500 beyond 5,000 this year, say global fund managers
Barbara Kollmeyer - MarketWatch
And just like that. A positive turn in Ukraine-Russia newsflow has a rebound firmly underway for risk assets on Tuesday.
The back and forth may be far from over, with Credit Suisse warning clients that armed conflict would knock 10% off stocks. And should this crisis start to ease, the full focus is likely to go back to high inflation and how central banks will handle that.
According to JPMorgan's chief global markets strategist Marko Kolanovic, markets caution over central banks has reached a tipping point, and with that, some good news.
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S&P 500 suffers biggest 3-day string of declines since October 2020 as investors monitor Russia-Ukraine crisis
Vivien Lou Chen and William Watts - MarketWatch
All three major stock indexes finished lower for a third straight trading day on Monday, with the S&P 500 index racking up its biggest three-day drop since October 2020, as U.S. allies warned of an imminent attack by Russian forces on Ukraine.
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| | | | | | Exchanges | | | NYSE US Exchanges To Close In Observance Of Washington's Birthday
NYSE
In observance of Washington's Birthday, 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, February 21, 2022.
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| | | | | | Regulation & Enforcement | | | SEC Warns Investors About Risks from High-Yield Cryptocurrency Accounts
Allyson Versprille - Bloomberg
The U.S. Securities and Exchange Commission is warning investors about risks associated with accounts that pay clients high interest rates for depositing crypto assets.
Companies offering interest-bearing accounts for digital assets don't provide the same protections as banks and credit unions, and the deposits aren't insured, the regulator's Office of Investor Education and Advocacy said in an investor bulletin Monday. Earlier in the day, the SEC announced that BlockFi Inc. had agreed to pay $100 million to federal and state securities regulators to settle allegations that it illegally offered a product that pays customers high rates to lend out their digital tokens.
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Regulators Probe Block Trading at Morgan Stanley, Goldman, Other Wall Street Firms
Susan Pulliam and Juliet Chung - WSJ
Federal investigators are probing the business of block trading on Wall Street, examining whether bankers might have improperly tipped hedge-fund clients in advance of large share sales, according to people familiar with the situation.
The Securities and Exchange Commission sent subpoenas to firms including Morgan Stanley and Goldman Sachs Group Inc. as well as several hedge funds, asking for trading records and information about the investors' communications with bankers, some of the people said. The Justice Department also is investigating the matter, some of the people said.
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| | | | | | Miscellaneous | | | Hedge Fund Performance 2021: 15 Top Managers Made $15.8 Billion
Tom Maloney, Hema Parmar and Katherine Burton - Bloomberg
Karthik Sarma outearned Steve Cohen last year.
The little-known hedge fund manager made an estimated $2 billion in 2021, mostly thanks to an 11-year-old wager on Avis Budget Group Inc., a bet that paid off handsomely as the stock soared 456%.
/jlne.ws/3gNPGJj
Salaries for Analysts and Associates at Top Investment Banks
Samantha Stokes , Reed Alexander , and Aaron Weinman - Business Insider
Junior bankers are earning more cash than ever.
Facing unprecedented M&A volume, Wall Street firms are struggling to hang on to enough young talent to staff deals. Juniors, on the other hand, are experiencing burnout.
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| | | Jeff Bergstrom
Editor
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