| April 25, 2023 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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MEMX CEO Jonathan Kellner talks about the launch of MEMX Options, the SEC's equity market proposals, and becoming a technology provider
JohnLothianNews.com
John Lothian News met up with Jonathan Kellner, the CEO of Members Exchange, aka MEMX, at the FIA International Futures Conference at Boca Raton in March. Unfortunately, we had some glitches with the video so we are presenting the interview as an article instead.
JLN asked Kellner for an update on MEMX options, which the exchange plans to launch in August 2023. The exchange got approval from the SEC in the fall, and in March, MEMX announced the completion of a round of equity funding led by Optiver.
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| | | | | | Lead Stories | | | Big Swings in One-Day Volatility Index Leave Traders Bewildered; The plunge is in contrast with gains in long-tenor vol gauges; Cboe has no immediate plans to start tradeable VIX1D products
Lu Wang - Bloomberg
One thing Matthew Tym has learned in two decades as a derivatives trader is to make sure he understands something before using it. That lesson is guiding his view of Wall Street's brand-new fear gauge. The Cboe 1-Day Volatility Index (ticker VIX1D) launched Monday as a way of distilling the price impact of a trading boom in options with a shelf life of less than 24 hours.
/jlne.ws/3Hc05fy
Low Volatility Masks Risks to Stocks, JPMorgan Says; Strategist blames market dominated by options sellers; Kolanovic advises selling on any market strength amid earnings
Alexandra Semenova - Bloomberg
The abnormal sense of calm signaled by Wall Street's favorite volatility gauge could spell trouble for investors who see the market lull as an all-clear to buy stocks, according to JPMorgan Chase & Co.'s Marko Kolanovic. The bank's top equity strategist said Monday in a note to clients that the drop in the Cboe Volatility Index, or VIX, is technical in nature, rather than an accurate reflection of the risks facing the stock market.
/jlne.ws/40wtWGp
VIX Owner Cboe Plans More Short-Term Products After 1-Day Fear Gauge
Katherine Doherty and Vildana Hajric - Bloomberg
The world's largest options exchange, nearing 50 years since its founding, plans to follow the launch of its one-day volatility index with more tools that capture near-term market swings.
On Monday, Cboe Global Markets Inc., the firm behind the Cboe Volatility Index (ticker VIX), known as Wall Street's "fear gauge," started the VIX1D Index, which measures volatility over a single day. This followed the exchange's expansion of "zero-day-to-expiry" options, or 0DTE, in 2022.
/jlne.ws/440fjOq
Low Volatility in Stock Market Hides Risks, JPMorgan's Kolanovic Says
Alexandra Semenova and Michael Msika - Bloomberg
The abnormal sense of calm signaled by Wall Street's favorite volatility gauge could spell trouble for investors who see the market lull as an all-clear to buy stocks, according to JPMorgan Chase & Co.'s Marko Kolanovic.
The bank's top equity strategist said Monday in a note to clients that the drop in the Cboe Volatility Index, or VIX, is technical in nature, rather than an accurate reflection of the risks facing the stock market. The VIX held near 17 on Monday after falling to 16 last week, a level not seen since late 2021.
/jlne.ws/40wtWGp
Volatility Shares launches inverse mid-term VIX ETF
James Lord - ETF Strategy
Volatility Shares has added a third fund to its volatility-focused ETF line-up with the new product providing inverse exposure to mid-term VIX futures.
The VIX is an uninvestable index that measures the market's expectation for volatility in US large-cap equities over the next 30 days. It is derived from implied volatility in near-term S&P 500 options contracts.
VIX futures, meanwhile, are liquid volatility products based on the VIX which enable investors to manage their volatility exposure independent of the direction of the stock market.
/jlne.ws/40C0Fdq
| | | | | | Exchanges | | | ETD Volume - March 2023
FIA
Worldwide volume of exchange-traded derivatives reached 10.57 billion contracts in March, the highest level ever recorded. This was up 24.9% from February 2023 and up 54.2% from March 2022.
Options continue to gain in popularity. Global trading of options reached 7.7 billion contracts in March, up by more than 83% from last year, with most of that trading taking place in the Asia-Pacific region. Global trading of futures reached 2.86 billion contracts in March, up 8% from the same month last year.
/jlne.ws/41U7N5S
Miami International Holdings Announces Execution of Purchase Agreement to Acquire LedgerX
MIAX
Miami International Holdings, Inc. (MIH), owner of Miami International Securities Exchange, LLC (MIAX ), MIAX PEARL, LLC (MIAX Pearl ), MIAX Emerald, LLC (MIAX Emerald ), Minneapolis Grain Exchange, LLC (MGEXTM), The Bermuda Stock Exchange (BSX), and Dorman Trading LLC, today announced that it has entered into a purchase agreement (the Purchase Agreement) to acquire all of the issued and outstanding membership interests of LedgerX, LLC (LedgerX) from Ledger Holdings, Inc. (LHI) in connection with the bankruptcy proceedings involving FTX Trading Ltd. and certain of its affiliated entities, pursuant to which LHI is a party.
/jlne.ws/3V8nRyT
MIAX Sapphire Exchange
Press Release
MIAX will begin with the launch of the electronic exchange which is targeted for Q1 2024 with the physical trading floor to follow, pending SEC approval. Important dates and exchange code information for MIAX Sapphire are included below. Details on the launch of the MIAX Sapphire trading floor will be announced in a future alert.
/jlne.ws/3L9XYtS
Coinbase to Face Established Rivals in International Push; Company plans to launch a crypto-derivatives exchange in Bermuda
Vicky Ge Huang and Paul Kiernan - The Wall Street Journal
To fend off a regulatory clash at home, Coinbase Global Inc. has been trying to expand into international markets. But some analysts are skeptical that the company can catch up to its deeply entrenched rivals overseas. The largest cryptocurrency exchange in the U.S. said last week that it plans to launch a crypto derivatives exchange in Bermuda in the coming weeks after obtaining a regulatory license to operate in the country.
/jlne.ws/43Zc7CK
NYSE, NYSE American, NYSE American Options, NYSE Arca Equities, NYSE Arca Options, NYSE Bonds, NYSE Chicago, NYSE National
NYSE
On October 14, 2023, NYSE, NYSE American, NYSE American Options, NYSE Arca, NYSE Arca Options, NYSE Bonds, NYSE Chicago, NYSE National, FINRA/NYSE TRF and Global OTC (collectively, "NYSE") will conduct business continuity and disaster recovery testing during the SIFMA coordinated industry test. Market participants that meet criteria established by the NYSE exchanges for designation as a required participant ("Required Participants") will be notified by NYSE by May 2023.
/jlne.ws/3HcmxFp
| | | | | | Regulation & Enforcement | | | Responding to Market Stress
International Swaps & Derivatives Association
Recent banking failures in the US and the acquisition of Credit Suisse by UBS are the latest in a series of stress events to have rocked financial markets, which includes the March 2020 dash for cash and the September 2022 UK liability driven investment (LDI) crisis. In the case of Silicon Valley Bank, the collapse appears to have been caused by risk management failures combined with a high interest rate environment.
/jlne.ws/41OkKOu
Coinbase Is Taking the SEC to Court in the Latest Salvo in Crypto's Legal Wars
Joe Light - Barron's
Coinbase Global last year heard crickets when it asked the Securities and Exchange Commission to make new rules for crypto. Now it wants a court to force the SEC to respond.
The crypto trading platform on Monday said it had filed a petition to a U.S. appeals court for a "writ of mandamus" to the SEC that in effect would order the agency to respond to a plea the company made last year for formal rule making on digital assets.
/jlne.ws/3oGHlhJ
| | | | | | Strategy | | | Stock Market Outlook: Volatility Is Too Low, Traders Should Sell Bounces
Joe Ciolli - Markets Insider
The stock market is awfully quiet right now. Perhaps too quiet.
Price swings are muted no matter how you look at them. On a forward 30-day basis â something measured by the VIX, which is commonly referred to as the stock market's fear gauge â traders are expecting the lowest volatility in more than two years. On an actual realized basis, the past 30 days have also been the most placid since 2021.
/jlne.ws/3n22BxY
| | | | | | Miscellaneous | | | FIA Diversity and Inclusion Efforts in 2022
FIA
FIA strongly believes in the importance of diversity, equity and inclusion in the workplace and works to support and celebrate the diverse voices both within our trade association and the derivatives industry at large. In 2019, we created a board-level Diversity Committee comprised of senior representatives from FIA member firms and FIA senior staff to consider practical steps to foster a culture of inclusion in the industry.
/jlne.ws/3Lq4QVi
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