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 | Jeff Bergstrom
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John Lothian News | |
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| | June 16, 2025 |
| | | Lead Stories | | | Big Tech's Furious Rally Forces Options Pros to Line Up Hedges
Bernard Goyder - Bloomberg
Big Tech has led the furious rebound in US stocks from the tailspin that followed President Donald Trump's sweeping April 2 tariff edict. Now options traders are signaling that they see the pricey cohort as especially vulnerable to another round of trade war-driven volatility.
The cost of protecting against a correction in the Invesco QQQ Trust Series 1 exchange-traded fund, which tracks the tech-heavy Nasdaq 100 Index, is climbing with less than a month to go until Trump's 90-day pause on reciprocal tariffs potentially ends. On Friday, the relative price of hedging against a 10% decline in the ETF, compared with a similar rally, hit its highest level since early April.
/jlne.ws/3FZdPgc
Options traders don't expect spike in oil prices to last: Cboe
Joseph Adinolfi - MarketWatch
Activity in oil options suggest traders responded swiftly as hostilities between Israel and Iran escalated last week.
Demand for out-of-the-money call options tied to oil spiked, sending implied volatility on contracts pegged to the commodity to its highest level in nearly three years, according to Cboe's Mandy Xu.
/jlne.ws/45m5Vb2
Oil Options Lure Bulls in Heavy Trade as Mideast Risk Grows
Yongchang Chin and Alex Longley - Bloomberg
A fresh wave of bullishness is washing through the oil-options market as traders protect against the risk to supplies in a region that pumps a third of the world's oil from mounting attacks between Israel and Iran. Following a weekend when the two sides exchanged fresh blows, including hits to energy infrastructure, several thousand lots of August calls with strike prices of more than $80 a barrel - which profit when prices rise - changed hands in the first few hours of Monday's session. At the same time, about 5,000 lots of September Brent $100 calls also traded.
/jlne.ws/4kFsOLh
Investors unnerved as Israel-Iran conflict fuels oil market rally
Saqib Iqbal Ahmed, Suzanne McGee and Linda Pasquini - Reuters
Investors were on edge as financial markets reopened on Sunday, with crude oil prices initially up near 4% as markets were gripped by the escalating threat of a sweeping conflict in the Middle East. U.S. stock futures opened marginally lower.
Israel and Iran launched fresh attacks on each other on Sunday, killing and wounding civilians and raising concerns of a broader regional conflict, with both militaries urging civilians on the opposing side to take precautions against further strikes. Yemen's Iran-aligned Houthis joined the fray.
/jlne.ws/3SRfHKX
Market Fear Gauge Simmers Down. Why the VIX Looks Calm.
Brian Swint - Barron's
The Cboe Volatility Index, also known as the VIX and the market's fear gauge, was retreating early Monday after rising along with the stock market's fall on Friday.
The index was at about 20, around the level that tends to be seen as dividing market turbulence and general calm. In the middle of last week it was below 17, but it's still well below the recent highs of 50 recorded in April when President Donald Trump unveiled his sweeping tariffs.
/jlne.ws/4e5fY6L
Fear of Uncertainty Held S&P 500 Back From Record. Now It's Real
Alexandra Semenova - Bloomberg
For weeks, the S&P 500 Index has inched along near an all-time high despite encouraging economic signals, as Wall Street's concerns about a rich stock market in the face of mounting global uncertainty kept buying in check. On Thursday night, those fears became real, with Israel and Iran exchanging missiles, threatening to start a wider war in the Middle East, which is already near boiling after years of fighting in Gaza. The price of oil spiked as much as 14% on Friday, while the yield on 10-year Treasuries halted a four-day slide and started rising again. The Cboe Volatility Index, or VIX, climbed above 20.
/jlne.ws/443WJpt
Active ETFs Now Outnumber Passive Funds in Industry Watershed Moment
Katie Greifeld - Bloomberg
The ETF market has hit a symbolic turning point: active funds now outnumber passive ones for the first time, marking a sharp break from the industry's index-tracking origins - even if actively managed assets still account for just a tenth of assets.
Roughly 51% of the nearly 4,300 US-listed exchange-traded funds are ones overseen by fund managers who have more discretion to pick stocks or other securities, eclipsing index-following products for the first time, Bloomberg Intelligence data show. The number of active ETFs has more than doubled in the past five years, from just 23% in 2020.
/jlne.ws/43Ko1lR
Crypto Altcoins Lead Slide as Geopolitics Spurs Haven Demand
Suvashree Ghosh and Kirk Ogunrinde - Bloomberg
Smaller, less liquid tokens such as Solana and Cardano led a decline in cryptocurrencies as financial markets shifted toward safety after Israeli airstrikes on Iranian nuclear targets. Bitcoin, which accounts for more than 60% of the digital asset world's market value, was little changed at around $105,600 after earlier dropping as much as 3%. Solana and Cardano were off by roughly 4%, after slumping as much as 8% and 6.7%, respectively. Total liquidation of crypto bets over the last 12 hours was $106.5 million on Friday in New York, with $44 million and $63 million in long and short positions closed respectively, according to data compiled by Coinglass.
/jlne.ws/4jR1jNw
This is nuts. When's the crash?; A very British bitcoin treasury company
Bryce Elder - Financial Times
One of the current market mysteries is why people are paying approximately $2 for $1 of bitcoin. After MicroStrategy discovered it could buy bitcoin in a recursive loop using money raised by selling shares and weird convertible debt at a premium to its net asset value, lots of companies have been doing the same thing. One of those companies is UK-listed, sort of. The Smarter Web Company trades on Aquis Exchange, the specialist junior venue, as well as a US over-the-counter exchange. It floated on Aquis on April 25, raising £1.1mn at 2.5p per share, for a market capitalisation of £3.7mn.
/jlne.ws/4493HcT
Japan's Bond Chaos Heralds More Volatility in Global Markets
Ruth Carson and Masaki Kondo - Bloomberg
Japan's once-slumbering bond market has roared back to life with a burst of volatility that is echoing around the world. Major debt markets have moved in tandem with Japanese government bonds during the recent rout, with a spike in super-long yields in the Asian nation amplifying ructions fueled by global fears of widening fiscal deficits.
/jlne.ws/3FHkOKJ
| | | | Exchanges | | | IDX 2025 opening remarks: Forging our future; Opening remarks of Walt Lukken, President and CEO of FIA, at the International Derivatives Expo (IDX) in London on 16 June 2025. As prepared for delivery.
FIA
Welcome to the International Derivatives Expo, or IDX as we affectionately call it. It's wonderful to see so many friends and colleagues.
The letter X contained in IDX is a perfect symbol for the crossroads that London represents. For generations, London is where the international community has come together to freely exchange goods, ideas and cultures.
IDX feels like a global family reunion among friends and colleagues. There are always hugs, laughter and double-cheeked kisses throughout the week. I'm glad to be a part of such a welcoming global community during such interesting times.
Yes, we gather in London feeling anxious about the world we are living in. How can you not? You can't pick up a paper, turn on the news or look at your phone without being inundated with stories about the world falling apart.
/jlne.ws/45ZuoDg
Euronext and Clearstream partner on collateral management enhancements; The improved service offering is expected to go live in November 2025.
Claudia Preece - The Trade
Euronext and Clearstream have unveiled a new partnership aimed at advancing the continued development of Euronext Clearing's collateral management services across repo, as well as other asset classes. The move is a step closer to Euronext's goal of creating a unified, pan-European clearing model for its repo clearing franchise. Anthony Attia, global head of derivatives and post-trade at Euronext, said: "This collaboration with Clearstream marks an important step in the execution of our 'Innovate for Growth 2027' strategy, reinforcing Euronext Clearing's ability to deliver cutting-edge collateral and clearing solutions.
/jlne.ws/4jVim14
ICE to dual-list on NYSE Texas
Intercontinental Exchange
Intercontinental Exchange, Inc. (NYSE:ICE), a leading global provider of technology and data and parent company of the New York Stock Exchange (NYSE), today announced that it will dual-list on NYSE Texas, effective June 17, 2025. "Founded 25 years ago and listed on the NYSE for nearly two decades, ICE has consistently worked to stay at the forefront of innovation in capital markets," said Jeffrey C. Sprecher, ICE Chair & Chief Executive Officer. "Supporting the momentum in Texas as Governor Abbott and his team create an environment where companies can thrive, we are delighted to join the community of companies listed on NYSE Texas."
/jlne.ws/4lsRtmz
| | | | Regulation & Enforcement | | | Policy Recommendations to Unlock Retail Participation in Europe's Options Markets
Cboe
In a new white paper, Cboe examines the pivotal role listed equity options can play in empowering retail investors and strengthening Europe's financial ecosystem, while also outlining key policy measures to support market growth. We believe that a vibrant options market-particularly for single-stock options, which offer a wide range of use cases including the hedging of equity exposures-can significantly enhance liquidity in related instruments and contribute to the overall health and resilience of European capital markets.
/jlne.ws/3HHzha4
| | | | Strategy | | | What CVOL Convexity Can Tell Us About Market Sentiment
Dr. Mark Shore and Michael Copeland - CME Group
CME Group's volatility index CVOL, is a suite of implied 30-day forward volatility indices measuring 30-day forward volatility across all option strike prices of key futures markets
Higher convexity translates to greater price volatility for out-of-the-money options from the current market price.
Market sentiment can be challenging to quantify, but financial analysts and traders have a powerful tool to help them gauge it: CME Group's Volatility Index, or CVOL. This index is particularly useful for navigating market uncertainty, especially through its convexity metric.
/jlne.ws/3I0p60c
Here's What Options Traders Expect for the S&P 500
Krystal Hur - The Wall Street Journal
Options traders are expecting calmer trading sessions going forward, despite ongoing tariff uncertainty and the conflict between Israel and Iran.
/jlne.ws/4e6vQpA
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Publisher | | | Sarah Rudolph
Editor-in-Chief | | | Jeff Bergstrom
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