| January 16, 2024 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | 
Short Put - Selling Short Put Options - Term of the Week
JohnLothianNews.com
This video explores the basics of how a short put option contract works.
Watch the video »
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Options Discovery Episode 29: Understanding The Foundations To Become A Successful Options Trader; Mark Esposito, Options Mentor at McMillan Analysis Corps., Discusses This and More With JLN's Asma Awass
JohnLothianNews.com
In this episode of Options Discovery, Asma Awass discusses the different principles that traders should understand about options. This episode includes a breakdown of calls and puts, choosing the underlying asset, and volatility & the Greeks. Asma then sits down with Mark Esposito, an options mentor at McMillan Analysis Corp, who shares more insight on the foundations of options trading. You can check out the Options Mentoring Program here: https://www.optionstrategist.com
Watch the video »
| | | | | | Lead Stories | | | Investors bet via options that India's rupee will rise
Nimesh Vora - Reuters
Investors are betting that India's rupee will break out of its narrow range and rally this year, and are expressing that view via currency options.
Volumes in the dollar-rupee options market have surged in the first few trading days of 2024, and the direction of these trades shows market participants expect the rupee to rise, escaping the central bank-induced narrow range of last year.
/jlne.ws/423c3kB
ETFs Make Bitcoin's Problems Even Worse; Bitcoin ETFs are likely to exacerbate its bad performance in crises by bringing in even more speculators to what's already mostly a speculative asset
James Mackintosh - The Wall Street Journal
As holders of bitcoin they undermine the very purpose, and so the long-term value, of a cryptocurrency. And as ETFs launched at a moment of popularity they might be repeating the mistake of many past thematic funds by buying at a peak.
Start with the first problem. What is bitcoin for? It was originally designed to allow small online transactions, but has failed miserably at that due to high costs and cumbersome payment processes.
/jlne.ws/49eDNWb
ChatGPT May Rival Flash Boys in Transforming Markets; Large language models have the potential to understand what drives asset prices - and change financial behavior forever.
Aaron Brown - Bloomberg
Large language models, such as ChatGPT, are threatening to disrupt most areas of life and work. Financial trading is no exception. The potential for LLMs to understand markets rather than just recognize patterns sets them apart from earlier versions of machine learning and artificial intelligence that have failed to achieve much notable trading success. The basic problem is that financial prices are nearly all noise, they are very close to random walks. Lots of smart people and algorithms conspire to eliminate any signal that can be used for profit. It's like trying to understand text that is deliberately written to be misleading. Traditional AI is more successful when signals are stronger relative to noise.
/jlne.ws/41XmypL
Investors pump record sums into bond and 'quality' stock ETFs
Steve Johnson - Financial Times
Exchange traded fund investors pumped record sums into fixed income and "quality" stocks last year as risk appetite jumped in the final months of 2023.
However inflation-linked bond funds and broad commodity ETFs experienced record outflows as sliding global inflation tempered investors' desire to hedge against its corrosive effect on asset prices.
/jlne.ws/3TXCPck
| | | | | | Exchanges | | | EEX Group annual volumes 2023: markets continue to grow; 01/16/2024 EEX Group News, EEX Press Release, Monthly Volume Report
EEX Group
Leipzig, 16 January 2024 - In 2023, trading volumes across the various markets of EEX Group have seen the return of confidence, with significant expansion on the power derivatives markets. Despite the continued unpredictability of the world economy and the geopolitical situation, EEX Group addressed customers' needs by expanding the product portfolio in power, natural gas and freight markets, as well as registry services.
/jlne.ws/47ApFFq
Taiwan Futures Exchange Newsletter
TAIFEX
TAIFEX's Market Performance in 2023. The Taiwan Futures Exchange (TAIFEX) closed out 2023 with a total of 324,644,847 contracts, with an average daily volume (ADV) of 1,358,347 contracts, marking the fourth consecutive year of over 300 million contracts traded. Among TAIFEX's flagship products, TAIEX Options (TXO) posted an ADV of 737,544 contracts. The trading in the night session remained active and accounted for 30.26% of the total volume. Additionally, the volumes of the newly-listed PHLX Semiconductor Sector Futures (SXF) reached 1,763 contracts in the first two weeks of launch.
/jlne.ws/3SlyTRB
| | | | | | Regulation & Enforcement | | | US bank capital proposals would increase capital requirements for client clearing by 80%
FIA
FIA strongly opposes provisions of two separate proposed rules put forward by US bank regulators that would dramatically increase capital requirements for derivatives clearing services that banks offer to their clients. Looking at just the six largest US banks that offer clearing, FIA estimates that these provisions would increase their capital requirements for client clearing by more than 80%.
If enacted as proposed, these rules would make it far more expensive for banks to provide their clients with clearing services for futures, options, and OTC derivatives. In turn, this could impair access to these instruments by a wide range of companies that use derivatives to hedge their risks or manage their investments. These companies include agricultural businesses, energy producers and public utilities, manufacturing and transportation companies, mortgage lenders, insurance companies, and pension funds. The proposed rules also would have the unintended consequence of increasing systemic risk by reducing the capacity to move customer positions out of a clearing firm in case that firm goes bankrupt.
/jlne.ws/3UkSjYf
FIA strongly opposes Basel III Endgame Proposal
FIA
FIA has warned US banking regulators that it has "serious concerns" about provisions in the Basel III Endgame Proposal that change the capital treatment of derivatives clearing activities that US banks provide to their clients. In letters filed today with the three agencies that issued this proposal - the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency - FIA said the proposed changes would increase the capital required to engage in client clearing activities by more than 22%, and therefore could lead to higher costs for end users such as agricultural businesses, insurance companies and pension funds.
/jlne.ws/47CzVg7
| | | | | | Technology | | | Trading Central releases Options Insight
Business Wire
Trading Central is proud to announce the launch of Options Insightâ¢, a new A.I. powered decision support tool that delivers long-awaited disruption to the derivatives segment of the Digital Wealth space.
For most self-directed retail investors, the main obstacles to trading options have been the complex jargon and the perceived risks. Our mission is to make Options trading inspiring, easy and accessible to everyone.
/jlne.ws/420ZPci
| | | | | | Strategy | | | Why Stocks Look Ready for a Big Drop
Jacob Sonenshine - Barron's
The stock market's run has gone too far, and a meaningful decline from here looks likely, judging by several factors.
/jlne.ws/48B5eJw
Sideways Range
Cboe (Video)
Tim Biggam @Delta_Desk covers the VIX Index's sideways range of late, action in February VIX options, implied volatility, and what to look for in earnings season - all in today's #Vol411.
/jlne.ws/3vLMpEX
| | | | | | Events | | | OIC 2024 Educational Series: Option Basics, Pricing Models and the Option Greeks
OIC
The Options Industry Council (OIC) will offer a new series of educational webinars during the first quarter of 2024, with two sessions planned for each month. As always, the goal is to help investors expand their knowledge of the risks and potential benefits of exchange-listed options.
Beginning in January, OIC will provide an overview of option basics, focusing on option terminology in the first session, followed by a discussion of call and put buying for the second webinar. In February, the focus across the two webinars will be on option pricing and models. During March, the main option Greeks will be discussed, starting with Delta and Gamma in the first session, then Theta, Vega and Rho afterward.
/jlne.ws/4aOv0vz
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| | | | 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
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