| April 01, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |
| | | | | | Lead Stories | | | Massive S&P options trade may have roiled U.S. stocks on Thursday
Saqib Iqbal Ahmed - Reuters
Traders are pointing to a massive quarterly options trade on Thursday they said was from a JPMorgan fund as one reason why the stock market took a nosedive late in the day, as options flows linked to the trade exacerbated market weakness. The S&P 500 Index fell 1.2% in the last hour of trading on Thursday, marking the largest hourly drop for the index in more than three weeks. It finished the day down 1.56%, with some attributing part of the weakness to the large options trade that went down earlier in the day.
/jlne.ws/36RgF5c
Goldman Sachs' OTC Bitcoin options trade 'doesn't mean much,' but can pave way for more institutional involvement
Jacquelyn Melinek - TechCrunch
Goldman Sachs is no stranger to testing the waters with crypto, with institutional clients looking for more exposure in the space.
Last week, Goldman was the first major U.S. bank to execute an over-the-counter crypto options trade with Galaxy Digital, which some market players say is foreshadowing more institutional adoption of digital assets.
/jlne.ws/3uQQlQC
U.S. Probes Meeting Between Activision CEO and Option Buyer
Dave Michaels and Kirsten Grind - WSJ
Authorities investigating timely trading in Activision Blizzard Inc. ATVI 0.66% securities are looking into at least one meeting between the videogame firm's chief executive and one of three traders days before they placed a large bet on Activision shares, according to people familiar with the matter.
Activision CEO Bobby Kotick met with Alexander von Furstenberg in the week before Mr. von Furstenberg and media moguls Barry Diller and David Geffen bought options to purchase Activision shares at $40 each on Jan. 14. The options trade, which has generated an unrealized profit of about $59 million, was arranged days before Activision agreed to be acquired for $95 a share by Microsoft Corp. , The Wall Street Journal has reported.
/jlne.ws/3tYcoFU
Why a '1970s-style' inflation spiral is a growing threat, according to a major hedge fund
William Watts - MarketWatch
One of the world's largest macro hedge funds sees a rising risk of a 1970s-type wage-price spiral, according to a Thursday news report.
"This combination of high inflation, tight labour markets, and uncertain inflation expectations introduces the prospect of a 1970s style wage-price spiral which proved very costly to reverse during the Volcker Era," Brevan Howard Asset Management said in a note to shareholders of a listed fund that it manages, Bloomberg reported.
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Commodity market cracks catch the eye of policymakers
Katie Martin - Financial Times
Andrew Bailey is worried about the commodities market. If you're not already, you probably should be too.
The Bank of England governor â not exactly stand-up comedian material at the most cheerful of times â delivered some strikingly dour words at an event hosted by think-tank Bruegel this week. He said that UK households face a "historic shock" to incomes this year due to soaring energy prices.
/jlne.ws/3uM96ot
GameStop shares soar 10% after the Reddit darling said it plans a stock split for the first time in 15 years
Shalini Nagarajan - Business Insider
The Reddit darling said Thursday it wants to increase share count to pay a stock dividend and for future needs.The stock split, which must go to shareholders for approval, would be its first in 15 years.
GameStop shares rose 10% in Friday's market open after the video-game retailer said it plans to seek shareholder approval for a stock split.
/jlne.ws/3IUaydu
Crypto vs gold: the search for an investment bolt hole
John Plender - Financial Times
Crypto assets are no longer on the fringe of the financial system. So says the IMF, which pointed out in a recent blog that the likes of bitcoin have matured from an obscure asset class with few users to an integral part of the digital asset revolution.
Millions of investors have been swept up by the enthusiasm for crypto, not least many retail savers lured by its surging prices. Some claim that in the post-pandemic world bitcoin could even displace gold as investors' asset of choice to address extreme risks, price instability and geopolitical turmoil of the kind exemplified by Russia's invasion of Ukraine. As Tyler Winklevoss, a tech entrepreneur, put it: "Our basic thesis for bitcoin is that it is better than gold."
/jlne.ws/3J4ha93
Bond Market Suffers Worst Quarter in Decades
Sam Goldfarb - WSJ
U.S. bonds' worst quarter in more than 40 years has come to a close. The question for many investors now is whether it is time to buy the biggest dip in recent memory.
The Bloomberg U.S. Aggregate bond indexâlargely U.S. Treasurys, highly rated corporate bonds and mortgage-backed securitiesâreturned minus 6% in 2022 through Wednesday, on track for the biggest quarterly loss since 1980.
/jlne.ws/3DuJkJg
| | | | | | Exchanges | | | ETF derivatives: Introduction of new ESG ETF options
Eurex
The Management Board of Eurex Deutschland took the following decisions with effect from 19 April 2022:
-Introduction of four ESG ETF Options according to the Contract Specifications for Futures Contracts and Options Contracts at Eurex Deutschland (Contract Specifications), pursuant to Attachment 2,
-Further editorial changes to the Annexes to the Contract Specifications, pursuant to Attachment 3.
/bit.ly/3JYwB3T
Cboe FX volume crosses the trillion dollar milestone
Abdelaziz Fathi - Finance Feeds
Cboe FX disclosed a total trading volume of $1.02 trillion, up 22 percent on a month-over-month basis from $840 billion in February?. This figure is the best reading for the exchange's monthly turnover since it hit a record peak in March 2020 at $1.20 trillion. In addition, it was higher by 16 percent year-over-year when weighed against $880 billion in March 2021.
/jlne.ws/3wXtZjh
Clearing Processing for CME Event Contracts - Effective April 04, 2022
CME Group
Clearing Processing for CME Event Contracts Further to the Press Release dated March 14, 2022 (and pending all relevant CFTC regulatory review periods), Chicago Mercantile Exchange Inc. ("CME"), The Board of Trade of the City of Chicago, Inc. ("CBOT"), New York Mercantile Exchange, Inc. ("NYMEX") and Commodity Exchange, Inc. ("COMEX") (collectively the "Exchanges") are providing preliminary information on the upcoming listing of Event Contract Options on certain CME Group futures on equity, foreign exchange (FX), energy and metals contracts as described in New Contract Advisory 22- 127.
/bit.ly/3iXgS9q
New Product: Preliminary Information Regarding the Upcoming Listing of Event Contract Options on Certain CME Group Futures Contracts - Effective March 31, 2022
CME Group
/bit.ly/3DwMEUh
Product Modification Summary for Clearing Firms, Bookkeeping Software Providers
CME Group
ISVs Enable All-or-None for all Options on SOFR Futures and to Weekly Eurodollar Mid Curve Options Effective Sunday, May 1, 2022 for trade date Monday, May 2, 2022, and pending all relevant CFTC regulatory review periods, please be advised that the Chicago Mercantile Exchange, Inc. (CME or EXCHANGE) will enable All-or-None trading for the products listed below on Open Outcry.
/bit.ly/3iVH9oE
Special Executive Report
CME Group
Effective Sunday, April 24, 2022 for trade date Monday, April 25, 2022, and pending all relevant CFTC regulatory review periods, Chicago Mercantile Exchange Inc. ("CME" or "Exchange") will list Tuesday and Thursday Weekly Options on E-mini Standard and Poor's 500 Stock Price Index Futures - Week 1 through Week 5 (European Style) contracts (the "Contracts") for trading on the CME Globex electronic trading platform ("CME Globex") and for submission for clearing via CME ClearPort as more specifically described below.
/bit.ly/3Lxug0h
| | | | | | Regulation & Enforcement | | | U.S. Probes Meeting Between Activision CEO and Option Buyer; Authorities are looking into at least one meeting between CEO Bobby Kotick and one of three traders who made a timely options trade
Dave Michaels, Kirsten Grind - WSJ
Authorities investigating timely trading in Activision Blizzard Inc. ATVI 0.67% securities are looking into at least one meeting between the videogame firm's chief executive and one of three traders days before they placed a large bet on Activision shares, according to people familiar with the matter. Activision CEO Bobby Kotick met with Alexander von Furstenberg in the week before Mr. von Furstenberg and media moguls Barry Diller and David Geffen bought options to purchase Activision shares at $40 each on Jan. 14. The options trade, which has generated an unrealized profit of about $59 million, was arranged days before Activision agreed to be acquired for $95 a share by Microsoft Corp. , The Wall Street Journal has reported.
/jlne.ws/3tYP6jq
| | | | | | Miscellaneous | | | Why This Popular Trading Strategy Is So Risky
CNBC (Video via YouTube)
In 2021, options activity hit a record high, with nearly 9.9 billion contracts traded. That was more than 32 percent higher than the previous record set in 2020. This increase in volume can be traced back to the meme stock mania as millions of new investors jumped into the stock market during the pandemic. Options trading is a popular strategy among institutional investors to hedge their risk in the markets, but if it's not executed carefully, it can lead to devastating losses. Watch the video above to learn how options trading took off and why the strategy can be so risky.
/jlne.ws/3NBLb3T
Shanghai Covid Lockdown Leaves Traders Stuck in Offices for Days
Bloomberg
Henry, a fund manager, is currently sharing a single bathroom in his office in Shanghai's financial district with more than 20 people, none of whom have access to a shower. He doesn't know how much longer he'll have to do this for.
He was called back on Saturday along with some other employees as part of his company's rotational work arrangement implemented amid Shanghai's worsening Covid outbreak. Henry packed up some clothes and necessities for a short stay, but days later, the elevator in his office building had been suspended, and 9 million people in the eastern half of the city were placed under a four-day lockdown.
/jlne.ws/3NKhfTg
Your Taxes Are Due Soon. Don't Bother Asking the IRS for Help.
Sabrina Escobar - Barron's
For many Americans, filing taxes can be headache-inducing in the best of times.
This year, that headache could well turn into a throbbing migraine amid "the most challenging year taxpayers and tax professionals have ever experienced," according to a report from the National Taxpayer Advocate.
/jlne.ws/3uKHekF
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| | | Jeff Bergstrom
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