| September 19, 2019 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | 
Donna Heidkamp: Futures Market Myths
JohnLothianNews.com
In this video from our MarketsWiki Education World of Opportunity event in Chicago, Donna Heidkamp, the executive director of RJO Futures, says the financial industry gives people the opportunity to be lifelong students, continuing to learn about the economy, politics, culture and many other topics. She also explores some of the myths about the futures markets, including that there is too much leverage in commodities, that you have to take delivery, and that nobody makes money in futures.
Watch the video »
| | | | | | Lead Stories | | | Investors take out record number of options to trade 'no-deal' Brexit; Boom in traders seeking to hedge against or speculate on moves in UK bond market
Philip Stafford - FT
Investors have taken out a record number of options contracts to bet on or hedge against moves in UK interest rates, amid rising concerns that Britain may depart the EU at the end of October without an agreement on its future relationship with the bloc.
/on.ft.com/31zuFZx
Saudi Attack Drives Crude Options to Most Bullish Since 2011
Todd Walt and Eddie van der Walt - Bloomberg
Options traders have become the most bullish on Brent crude in eight years as the aftermath of last weekend's attack on a Saudi Arabian processing facility stirs up concern about the security of oil supplies.
/bloom.bg/2M3trPD
****JB: See also Reuters' story, Oil traders reassess interruption of Saudi output
Top Norway Stock Fund Is Cutting Risk in Shift to Defensives
Jonas Cho Walsgard - Bloomberg
The top Norwegian equity fund is shifting into defensive stocks as the market wobbles.
"This year it has moved from a cyclical to a more defensive tilt, but with a reaction in the past months," Leif Eriksrod, head of equities at Alfred Berg Kapitalforvaltning AS, said in an interview on Friday.
/bloom.bg/2M02Gfb
Bond King Gundlach says this contradiction in stock and bond markets is 'danger signal'
Mark DeCambre - MarketWatch
Bond-market guru Jeff Gundlach says he's watching a few areas of the market to gauge whether the current bullish dynamic is starting to unravel in earnest. On Wednesday afternoon, during a CNBC interview, he said that he sees some early cracks that are worth investors' attention.
Those include readings of consumer sentiment and a disparity between gauges of volatility in the bond and the stock markets.
/on.mktw.net/2M6gGUN
The Fed Cut Rates Today. Repairing Money Markets Comes Next.
Alexandra Scaggs - Barron's
Short-term interest rates soared early this week, forcing the Federal Reserve to step in twice to keep its policy rate within the target range and raising expectations that the central bank might take major steps to repair the market's plumbing.
bit.ly/2mr3X5R
| | | | | | Exchanges and Clearing | | | Chicago options exchange to move headquarters, open new trading floor; Cboe Global Markets, parent company of the Chicago Board Options Exchange, will move its headquarters to the Old Post Office; the trading floor is moving to the Chicago Board of Trade Building.
David Roeder - Suntimes
The parent company of the former Chicago Board Options Exchange said Tuesday it will move its headquarters into the Old Post Office and will build a new trading floor in the Chicago Board of Trade Building at 141 W. Jackson.
bit.ly/307Zbfv
Bursa Malaysia Extends Agreement to Host its Derivatives Products on CME Globex, and Plans to Acquire the Remaining 25% Equity Interest in Bursa Malaysia Derivatives
Press Release
Bursa Malaysia Berhad today announced that it has extended its agreement with Chicago Mercantile Exchange Inc to host Bursa Malaysia Derivatives Berhad's ("BMD") products on CME Globex until September 2025 (with the option of successive renewal terms of 3 years thereafter). Bursa Malaysia will in turn acquire the 25% equity interest in BMD currently held by CME Group Strategic Investments LLC ("CMEGSI") following the exercise of the Put Option as prescribed under an agreement entered into on 30 November 2009.
bit.ly/31v1t68
EBS Launches Next Generation EBS Direct Platform
CME Group
EBS, a leading provider of electronic trading platforms and technology services in foreign exchange markets, today announced it is launching a next-generation EBS Direct platform with enhanced capacity and speed, which will deliver round trip processing times below 50 microseconds.
The new platform, which is now live in beta-testing with clients, will feature faster market data and will provide greater certainty of execution and improved fill ratios. EBS will transition clients to the new EBS Direct platform in four phases over the next 18 months, adding new functionality and reducing latency at each stage. The rollout is expected to be completed by the first half of 2021, after which time the current EBS Direct architecture will be decommissioned.
bit.ly/31FtisA
CME Group Announces SOFR Futures Trading Volume and Open Interest Records
CME Group
CME Group, the world's leading and most diverse derivatives marketplace, today announced Secured Overnight Financing Rate (SOFR) futures reached a daily volume record of 152,649 contracts traded on Sept. 17, surpassing the previous single-day volume record of 86,459 contracts traded on July 25, 2019. SOFR futures open interest also reached an all-time high of 351,662 contracts on Sept. 17, surpassing the prior record of 311,371 contracts on Sept. 16.
bit.ly/31zvO3r
****JB: While there are no options on these yet, there probably will be soon(ish). From the press release, "CME Group recently announced it will launch options on Three-Month SOFR futures starting on Jan. 6, 2020, pending regulatory review."
London Stock Exchange chief launches robust defence of Refinitiv deal
Philip Stafford - Financial Times
The chief executive of the London Stock Exchange Group has launched a robust defence of its $27bn acquisition of data and trading group Refinitiv that the Hong Kong Exchanges and Clearing is trying to gatecrash with its bid for the UK bourse.
/on.ft.com/2M33fF2
| | | | | | Regulation & Enforcement | | | U.S. derivatives watchdog calls on EU for more trust
Huw Jones - Reuters
The European Union should provide clarity on when it will intervene in a foreign clearing house for derivatives to avoid potentially impeding cross-border co-ordination among supervisors, a senior U.S. regulator said on Thursday.
Dawn Stump, a commissioner at the U.S. Commodity Futures Trading Commission, said the EU should put more trust in the home regulators of foreign clearing houses or central counterparties (CCPs) that serve customers from the bloc.
/reut.rs/32K0xLk
LSE CEO says expects EU to extend 'equivalence' for euro clearing beyond March 2020
Huw Jones - Reuters
The European Union is expected to allow EU customers to continue using the London Stock Exchange's derivatives clearing house beyond next March if there is a 'no deal' Brexit, the company's chief executive David Schwimmer said on Thursday.
/reut.rs/2Mfaudd
| | | | | | Technology | | | EBS Launches Next Generation EBS Direct Platform
CME Group
LONDON and NEW YORK, EBS, a leading provider of electronic trading platforms and technology services in foreign exchange markets, today announced it is launching a next-generation EBS Direct platform with enhanced capacity and speed, which will deliver round trip processing times below 50 microseconds.
bit.ly/31FtisA
| | | | | | Moves | | | Industry veteran Shuster leaves Credit Agricole after 17 years
Julia Barr - FX Week
Dmitri Shuster is set to leave his position as co-head of global markets trading at Credit Agricole in London after almost two years in the role, according to three sources in the market, FX Week has learned.
bit.ly/2mr8ghD
| | | | | | Strategy | | | VIIX: Sell The Pop, Capture The Drop
Seeking Alpha
At the time of writing, the VelocityShares VIX Short-Term ETN (VIIX) has risen by about 1% in the wake of the Federal Reserve's decision to cut rates and about 3% higher on the week. This upside return isn't that substantial, but it does give us a good opportunity to short into the downtrend of VIIX. Specifically, I believe that in the coming weeks, the long-term trend of VIIX falling will continue and will do so at an accelerating rate.
bit.ly/30wuv3U
| | | | | | Miscellaneous | | | Fed Chairman Jerome Powell Masters the Art of Saying Nothing
Greg Ip - WSJ
Asked Wednesday when the Federal Reserve would be done cutting interest rates, Chairman Jerome Powell answered: "When we think we've done enough."
Reminiscent of Supreme Court Justice Potter Stewart's definition of pornographyâ"I know it when I see it"âMr. Powell's answer was crafted both to convey the imprecision of the task and avoid tying him down with specifics.
/on.wsj.com/30d5wq9
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