| July 14, 2025 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | | | | | Lead Stories | | | Mysterious Option Trades Put Spotlight on Key Indian Stock Index
Chiranjivi Chakraborty - Bloomberg
As India's securities regulator ramps up scrutiny of the options market, some investors are pointing to mysterious moves in contracts tied to the nation's benchmark index as evidence of questionable trading activity. Traders say one tell-tale sign of abnormal price action can be seen in the so-called straddle on the NSE Nifty 50 Index. A hard-to-explain increase in its price during expiration days has become a common sighting in recent years, though it doesn't always happen. It was visible as recently as mid-May.
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Jane Street Sets Aside $564 Million as India Probe Continues
Ruchi Bhatia, Chiranjivi Chakraborty, and Bei Hu - Bloomberg
Jane Street Group LLC has deposited 48.4 billion rupees ($564 million) in an escrow account to comply with an order from India's securities regulator, part of an ongoing probe into allegations of market manipulation by the US trading giant. While Indian authorities had previously indicated the deposit would allow Jane Street to return to local markets after a ban imposed on July 3, the regulator's statement on Monday didn't clarify whether the firm has a green light to resume trading. The Securities and Exchange Board of India has accused Jane Street of manipulative transactions involving local options and shares - allegations that the firm has denied.
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Upstart Money Managers Lure Retail-Trader Billions With High-Risk ETFs; Matthew Tuttle is one of the leading architects of leveraged single-stock ETFs, which now command about $22 billion and counting.
Emily Graffeo and Vildana Hajric - Bloomberg
At Matthew Tuttle's home office in Greenwich, Connecticut, the big money isn't made in his trading software - it's made in the two extra screens he has rigged up next to it. "This is a Discord, that's a Discord, this is a Discord," the 56-year-old says, pointing to multiple windows on each display where the online messaging platform is running. These screens are the secret behind the success of this unorthodox money manager, who oversees $4.5 billion with a team working entirely from home. They're also key to a boom that's testing the limits of America's $11.7 trillion market for exchange-traded funds.
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Traders hedge on Jane Street manipulation claims; Market-makers side with Sebi, while bankers accept arbitrage explanation. Most want more details.
Helen Bartholomew and Lukas Becker - Risk.net
Accusations by the Indian securities regulator that market-maker Jane Street manipulated the country's stocks and derivatives have divided opinion among banks and trading firms. While some agree with the regulator's findings, others say Jane Street was simply capitalising on a lucrative arbitrage. Most though are withholding judgement until all the facts are in.
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Options Signal More Earnings Season Swings on Tariff Turmoil
Christian Dass - Bloomberg
The looming impacts of tariffs will be in focus for a second-straight earnings season, prompting investors to position for more volatility. Trade tensions have ratcheted up again as US President Donald Trump threatens higher levies on a slew of trading partners - including 50% on Brazil and 30% on the European Union - and claims no extensions will be granted for the latest Aug. 1 deadline. Given the past months' drama over tariffs, the renewed uncertainty may continue to hinder some companies' ability to offer forward guidance.
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| | | | Exchanges | | | Eurex Expands Global Index Derivatives Suite with First Futures on the MSCI Korea Index
Eurex
Eurex, one of the world's leading derivatives exchanges and part of Deutsche Börse Group, announces the launch of Futures on the MSCI Korea Index. With this launch Eurex provides efficient and cost-effective access to the Korean equity market, supporting international investors diversifying exposures worldwide on a single venue. Trading will start on July 14, 2025. Eurex is currently the only derivatives exchange outside of Korea offering access to a Korean equity index. As of June 30, 2025, Korea accounts for 10.73 percent of the MSCI Emerging Markets (EM) Index, ranking as the fourth-largest country allocation in the index, which captures large- and mid-cap representation across 24 EM countries.
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Tokyo Stock Exchange to Conduct a Survey on English Disclosure by Japanese Companies
JPX
Tokyo Stock Exchange, Inc. is conducting a survey on disclosures in English by listed companies to investors. This survey aims to assess overseas investors' opinions on the English disclosure requirements for the Prime Market, which came into effect in April 2025, and to promote English disclosure that meets the needs of overseas investors by providing feedback on the survey results to listed companies.
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LSEG Global Cloud Survey: Financial Services Firms Embrace Cloud to Drive Competitiveness
LSEG
Financial services firms around the world are accelerating their adoption of cloud technologies to enhance agility, resilience, and innovation, not merely to reduce costs, according to new research conducted by LSEG (London Stock Exchange Group). The global survey of 453 financial services executives reveals that 87% of firms have increased their investment in cloud over the past two years, with a growing emphasis on strategic outcomes such as scalability, revenue growth, and AI enablement.
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Tariff Threat Dismissed as Implied Volatilities Fall
Mandy Xu - Cboe
Link to Report: Macro Volatility Digest
WHAT STANDS OUT: Implied volatilities fell across asset classes last week despite renewed trade headlines as investors largely shrugged off the new tariff threats. Credit volatility declined the most, with VIXIG index falling over 3 pts to 23bps vol, trading almost 1 std. dev. below its long-term average and screening as the cheapest cross-asset vol. All this is far cry from the last time President Trump threatened large-scale tariffs against US trading partners, when implied volatilities surged across asset classes following the "Liberation Day" announcement. The lack of a reaction this time shows investors have grown desensitized to tariff headlines and view this as just part of a negotiating tactic toward an eventual deal.
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Cboe Canada to add visible primary pegged order type to NEO Books
Maria Nikolova - FX Newsgroup
Effective September 30, 2025, subject to regulatory approval, the Cboe Canada Inc. NEO-L and NEO-N Trading Books will add a visible primary pegged order type. Upon the effective date, visible primary pegged orders will be supported over FIX and BOE order entry protocols on the NEO-L and NEO-N Trading Books. Visible primary pegged orders will only be available during Regular Trading Hours (RTH) and will not participate in opening or re-opening auctions, but will participate in closing auctions if the price allows.
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| | | | Regulation & Enforcement | | | Taiwan's central bank tells foreign investors to stop violating capital controls; Warning comes as authorities seek to contain volatility in rapidly appreciating currency
William Sandlund and Haohsiang Ko - Financial Times
Taiwan's central bank has warned "a few foreign investors" against violating its capital controls as it seeks to contain volatility in its rapidly appreciating currency. In a statement to the Financial Times, the Central Bank of the Republic of China said it had "strengthened communication with a few foreign investors" and "asked them to self regulate and make necessary improvements" after finding that foreign capital inflows were not being invested in domestic securities. It did not name the investors.
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| | | | Strategy | | | How the TACO trade could end up backfiring on investors
William Edwards - Business Insider
Buying the dip during recent tariff volatility has been a profitable strategy this year, but will the so-called TACO trade backfire on bullish investors confident that the president will always back down? It didn't take long for investors to figure out that Trump doesn't always mean what he says when it comes to trade policy. The TACO trade - short for "Trump always chickens out," a phrase coined by the Financial Times' Robert Armstrong to describe Trump's habit of backing away from proposals that roil markets- has emerged as a result. Investors have started not to take Trump so seriously, believing his more extreme policy proposals, like blanket tariffs or firing the Chairman of the Federal Reserve, are just a bluff.
/jlne.ws/4nNqHam
The Market Is Ignoring the War in Ukraine. It Shouldn't Be.
Paul R. La Monica - Barron's
Support for Ukraine is one of the few things that Democrats and Republicans in Congress can seem to agree on these days. And President Donald Trump has said that the U.S. now plans to send Patriot missiles to Ukraine as part of a NATO deal to help Ukraine defend itself against Russian attacks. Trump has also proposed even harsher tariffs on Russia and its trading partners if there is no peace agreement within 50 days. The tension is escalating. But the market is ignoring it-perhaps at its own peril.
/jlne.ws/40Vltzl
Bitcoin is a volatility hedge, says market strategist
Reuters (Video)
Tally Leger, chief market strategist at The Wealth Consulting Group, says Bitcoin is doing exactly what it was built for, as it "functions as kind of a mitigating force or portfolio insurance and they did their job in the high volatility drawdowns" earlier this year.
/jlne.ws/44GYARj
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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
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