| October 25, 2023 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
|
| | | | Observations & Insight | | | CQG at FIA EXPO 2023: Ryan Moroney's take on rates, AI regulations, and Equity Options
Rick Steves - FinanceFeeds
At the FIA EXPO 2023, CQG's CEO, Ryan Moroney, discussed the impact of high interest rates on stock markets, called for clarity on AI regulations following SEC concerns, and revealed CQG's plans to introduce equity options by early next year.
/jlne.ws/3SdIwSt
| | | | | | Lead Stories | | | Bitcoin volatility explodes, reflecting 'short squeeze,' bullish options bets; The bitcoin derivatives market is beginning to show heightened volatility and interest from participants seeking to take advantage of the week's major price moves
Sebastian Sinclair - Blockworks
Volatility across the crypto derivatives market leaped to fresh local highs this week following a surge led by major blue chip asset bitcoin (BTC). A two-month period of relatively muted market activity had placed the world's largest digital asset in relative stasis, trading within a $2,000 range. But on Monday, the market sprang to life, with a 14% rise in the asset's price topping out at just above $35,000 on Tuesday. That activity caused a flush of large leveraged short positions, creating a short squeeze â short sellers closing out their positions "en mass" â Bradley Duke, chief strategy officer at ETC Group told Blockworks.
/jlne.ws/3tMWAZ0
'50 Cent' Trader Bets Big the Japanese Yen Will Surge 'Violently'
Filip De Mott - Markets Insider
Ruffer Investing, whose winning bets in the volatility market earned it the nickname "50 Cent," is betting big on the world's worst-performing currency: the Japanese yen.
The yen has fallen over 14% this year, representing a major driver behind the UK fund's poor performance. But Chairman Jonathan Ruffer said in a letter earlier this month that he expects a major reversal.
/jlne.ws/490o11A
****JB: Also see the Financial Times' story, '50 Cent' has a big new trade on - the Japanese yen.
Bill Ackman makes $200mn from bet against US Treasuries
Costas Mourselas - Financial Times
Billionaire hedge fund manager Bill Ackman made a profit of about $200mn from his high-profile bet against US 30-year Treasury bonds, according to people familiar with the trade.
The founder of Pershing Square Capital Management said on social media on Monday that he had exited the short position he first announced in August. His post helped fuel a recovery in Treasury prices, after an earlier sell-off had pushed yields to 16-year highs.
/jlne.ws/3QdbGhR
Trading in some stock options halted for second time in a week as exchanges hit by outage
Joseph Adinolfi - Morningstar
Trading in some U.S. equity options was briefly halted on Wednesday as a critical piece of the options-market plumbing suffered its second outage in a week. A processing issue at the Options Price Reporting Authority, an entity that collects and aggregates data on options trades from the 16 U.S. options exchanges, forced Cboe Global Markets -- which operates four of those exchanges, including the largest by volume, Cboe Options Exchange -- to temporarily suspend trading in so-called multilisted options, which trade on multiple exchanges, according to a statement on the exchange operator's website.
/jlne.ws/46ICmhO
Chip stocks just got sent a big warning
James Rogers - MarketWatch
Texas Instruments just sent a grim warning about the state of the semiconductor industry, and stocks across the sector are feeling the impact.
The chip maker, which historically reports early in the earnings cycle and is viewed as an industry bellwether, cited weakening industrial demand Tuesday afternoon as it underwhelmed with its forecast. That struck one analyst as a "negative" read for the broader sector, especially those companies exposed to industrial trends.
/jlne.ws/471dQrR
The Stock Market's 'Crown Jewels' Aren't Immune to Volatility
Gunjan Banerji - WSJ
The tech-heavy Nasdaq Composite is down around 1.2% in recent trading, lagging behind its peers.
To some analysts, the recent volatility is a harbinger of more tumult to come, and a sign that the stock market's starsâmega-cap tech stocksâare susceptible to poor earnings reactions.
/jlne.ws/3S8K7Jm
Goldman Wants Trading Derivatives to Be Easy as Buying on Amazon; Bank offering visual structuring tech for credit derivatives; Company plans to expand product to rates trading next year
William Shaw - Bloomberg
Goldman Sachs Group Inc. is expanding its use of a technology that leverages artificial intelligence in the hopes that it will make it easier for clients to plan complex derivatives trades. After already using the software to shake up the worlds of equities and foreign exchange options, the firm in recent weeks began allowing clients to use its visual structuring product for credit derivatives. It's aiming to offer the service for rates trading in the first half of next year, Chris Churchman, who runs Goldman's digital trading platform Marquee, said in an interview.
/jlne.ws/45JI9Cm
Shorter US settlement times have European ETFs rushing to be ready; Moving to a one-day settlement cycle is likely to increase costs for the continent's asset managers
Emma Boyde - Financial Times
A decision by the US Securities and Exchange Commission to shorten the period for settling bond and share trades - from two days to just one - has prompted a burst of activity in the exchange traded fund industry. Much of it has been trying to assess the difficulties this will pose in Europe - as US securities now represent more than 40 per cent of EU funds' assets under management, according to the European Fund and Asset Management Association.
/jlne.ws/46Ys39z
| | | | | | Exchanges | | | CME Group Inc. Reports Third-Quarter 2023 Financial Results
CME Group
CME Group Inc. (NASDAQ: CME) today reported financial results for the third quarter of 2023. The company reported revenue of $1.3 billion and operating income of $820 million for the third quarter of 2023. Net income was $750 million and diluted earnings per common share were $2.06. On an adjusted basis, net income was $818 million and diluted earnings per common share were $2.25. Financial results presented on an adjusted basis for the third quarter of 2023 and 2022 exclude certain items, which are detailed in the reconciliation of non-GAAP results.
/jlne.ws/3tKh2Kf
| | | | | | Regulation & Enforcement | | | "Partners of Honest Business and Prosecutors of Dishonesty": Remarks Before the 2023 Securities Enforcement Forum
Chair Gary Gensler - SEC
I am pleased to join you at the 2023 Securities Enforcement Forum. As is customary, I'd like to note that my views are my own as Chair of the Securities and Exchange Commission, and I am not speaking on behalf of my fellow Commissioners or the SEC staff. When I spoke with you two years ago, I shared what the SEC's first chair, Joseph Kennedy, said in his first speech: "The Commission will make war without quarter on any who sell securities by fraud or misrepresentation."[1] In a subsequent speech, just four months later, Kennedy emphasized: "We are not prosecutors of honest business, nor defenders of crookedness. We are partners of honest business and prosecutors of dishonesty. We shall not prejudge, but we shall investigate."[2] These words remain just as true today.
/jlne.ws/46Zcb62
Hedge fund co-founder Neil Phillips convicted over forex manipulation
Joe Miller and Costas Mourselas - Financial Times
A New York jury has convicted Neil Phillips, the high-profile manager of a London-based hedge fund previously backed by George Soros, over an alleged scheme to manipulate the US dollar to South African rand exchange rate as part of a ploy to trigger a $20mn options payment.
The 53-year-old Briton, who co-founded the emerging markets-focused Glen Point Capital in 2015, was found guilty on Wednesday of commodities fraud after a week-long trial. He was acquitted on a related count of conspiracy to commit commodities fraud.
/jlne.ws/3QwQoNG
| | | | | | Technology | | | Liquidnet launches pre-trade analytics solution for listed derivatives; The move marks Liquidnet's entry into the listed derivatives space and will offer actionable intelligence to better inform decision-making processes ahead of execution.
Wesley Bray - The Trade News
Liquidnet has launched a new pre-trade analytics offering for listed derivatives, available in Europe and the US. The new solution offers actionable intelligence including volume, liquidity, activity and projected volume to better inform the decision-making process ahead of execution. "Historically, banks have dominated the provision of solutions and execution services to the buy-side," said Mike du Plessis, global head of listed derivatives at Liquidnet.
/jlne.ws/3QcqRYD
| | | | | | Moves | | | Hedge fund Brevan Howard hired 300 new people
Sarah Butcher - Efinancialcareers.com
It's been another year of heavy hiring at big multistrategy hedge funds and their aspirants. As we reported last week, Eisler Capital Management has increased its investment teams by 50% to 60 this year, while its population of strats (hybrid quants and technologists) is up 60%. Eisler is not alone in raking in staff: Brevan Howard has increased its headcount by circa 40% too.
/jlne.ws/46KwdBz
| | | | | | Miscellaneous | | | What derivatives history tells us about crypto's future growth; Derivatives offer a blueprint for how a misunderstood asset, like crypto, can achieve widespread support across financial markets
Bart Hillerich - Blockworks
Capital markets are an ever-changing constant in modern society. Their role has evolved across centuries, driven by the gradual progress of product innovation and the globalization of capital, particularly in the last few decades, in which we've seen unprecedented development in how markets operate. Algorithms have overtaken humans in asset trading, and innovations like derivatives, originally feared and scorned, have become an integral part of daily trading. Today, we are all witness to the digitization of markets-everything from tokenization to stablecoins-as the cryptocurrency industry seeks to reshape the very foundation upon which the traditional system rests.
/jlne.ws/3MgsJ1k
Goldman Has a Derivatives Robot
Matt Levine - Bloomberg
Disclosure! I used to sell customized derivatives at Goldman Sachs Group Inc. There are roughly four steps in pricing a complex derivative to show to a client:
Oh, I kid, probably programming the model (Step 1) is the most important part; if you get that wrong then you have huge systemic problems. But the quants do that. At the level of derivatives sales, nudging the price up to what the client is willing to pay is what earns you your bonus.
/jlne.ws/46ESFvU
| | | | |  | | | | JLN Options is sponsored by: | | | | | |  |  |  |  | | | | | |  |  | | |
|
|
| | | |
| | | | John Lothian News (JLN) is the news division of John J. Lothian & Company, Inc. (JJLCO). The online media and financial services firm is staffed by derivatives industry, journalism and technology professionals. | | | | | | | John Lothian News Editorial Staff: | | | John Lothian
Publisher | | | Sarah Rudolph
Editor-in-Chief
| | | Jeff Bergstrom
Editor
| | | Asma Awass
Intern |
|
|
| |
Disclaimer: All John Lothian Newsletters, JohnLothianNews.com, MarketsWiki.com and MarketsReformWiki.com are products of John Lothian News, a division of John J. Lothian & Company, Inc. The opinions expressed in all John J. Lothian & Company, Inc. publications are strictly those of their respective editors. They are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Security futures are not suitable for all customers. Futures and options trading involve risk. Past results are no indication of future performance. Nothing on any John J. Lothian & Company site should be considered an endorsement by any sponsor of any website or newsletter content.
© 2023 John J. Lothian & Company, Inc. All Rights Reserved. |
|
|
