| June 29, 2021 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | Are you a fintech innovator startup? The FIA is looking for you for their Innovators Pavilion at the Futures and Options Expo 2021, billed by the FIA as the "industry's largest and most comprehensive conference and trade show." The conference is November 2 to 4 at the Hilton Chicago. All selected fintech startups will participate in a pitch competition and one will be named the FIA Innovator of the Year. In addition, Expo attendees, including senior executives from exchanges, clearinghouses, banks, brokers and trading firms, will vote for the People's Choice Award winner. Apply HERE.
| | | | | | Lead Stories | | | NIO Stock Is Going Nuts. Soaring Options Volume Is the Best Explanation.
Al Root - Barron's
Stock in Chinese electric vehicle maker NIO is on fire. While a surge in the volume of options trading isn't a perfect explanation for the rally, it certainly helped shares soar on Monday.
NIO (ticker: NIO) stock gained almost 10% Monday and shares are up 28% over the past month. The S&P 500, for comparison, rose 0.2% Monday and is up 2% over the past month. Call options volume, which rose almost 200% on Monday compared to Friday, is perhaps the biggest reason NIO shares might be more volatile.
/bit.ly/3AbvYzO
U.S. Options, Futures Market Offers Opportunity: IG Group's CEO
Bloomberg (VIDEO)
June Felix, chief executive officer at IG Group Holdings Plc., discusses her ambitions for the company in the U.S., the acquisition of TastyTrade Inc. and the rise of retail traders. She speaks on "Bloomberg Markets: European Open."
/bloom.bg/3x7X1d4
Global shares trade near record highs ahead of key US jobs data while gold slides against a stronger dollar
Sophie Kiderlin - Markets Insider
Global shares traded near record highs as investors awaited the release of US non-farm payroll data later in the week, which is expected to reflect strong growth, but could lead the Federal Reserve to withdraw support for the economy more quickly than many expect.
US futures were muted on Tuesday, with Dow Jones futures last up 0.17%, S&P 500 futures flat and Nasdaq 100 futures dipping 0.19% at 4:00 am E.T. The Nasdaq hit a fresh record high on Monday as tech stocks climbed for the sixth session in a row, which also took the S&P 500 to new highs.
/bit.ly/360rFcB
What's next for the stock market's 'great rotation' as 'growth vs. value' battle searches for direction?
William Watts - MarketWatch
Value-investing aficionados waited more than a decade for a moment back in the sun. Some investors think that moment has now already passed â or even perhaps that the whole notion of value versus growth remains a bit overdone.
Michael Loukas, principal and chief executive of TrueMark Investments, said that even when the Federal Reserve begins to raise interest rates, investors will still be dealing with a "low-yield environment". This is a backdrop that remains favorable for secular growth stocks, which are shares of companies that are expected to see accelerated earnings and revenue growth regardless of economic conditions.
/on.mktw.net/3x8qcgd
Archegos revealed flaws of markets that still need to be tackled
Satyajit Das - Financial Times
The teeth gnashing and hand wringing in the aftermath of the problems at Archegos misses a fundamental problem that is still to be addressed â misuse of collateral.
The hedge fund synthetically purchased Chinese and US shares using derivatives known as total return equity swaps. The off-balance sheet transactions did not require payment of the full purchase price but merely agreement to meet so-called margin calls. These are payments made to a counterparty to help cover potential losses on trading positions.
/on.ft.com/3wZFvI5
| | | | | | Exchanges | | | Jamie Dimon Says Paris Is JPMorgan's New EU Trading Hub
Ania Nussbaum and Alexandre Rajbhandari - Bloomberg
Paris has become JPMorgan's main trading center in the European Union, Chief Executive Officer Jamie Dimon said at the inauguration of the bank's new headquarters in Paris on Tuesday.
The new premises has six trading floors and will see between $300 billion and $400 billion in trading volume every day, Dimon told reporters.
/bloom.bg/2UcQ5wG
Cboe LIS Powered by BIDS Extends Global Playbook
Shanny Basar - Traders Magazine
Cboe Global Markets aims to launch Cboe LIS powered by BIDS Trading in Canada and use this model to extend its equities block trading network beyond the U.S. and Europe.
The exchange group completed its acquisition of MATCHNow, the largest equities alternative trading system in Canada in August last year. The Canadian offering will combine MATCHNow's conditionals book with block trading capabilities from BIDS and is slated to launch on February 1 2022, subject to regulatory approval.
/bit.ly/2UHnNe2
| | | | | | Regulation & Enforcement | | | SEC Charges JPMorgan Unit Neovest for Operating as Unregistered Broker-Dealer
Dave Sebastian - WSJ
The Securities and Exchange Commission said it has charged Neovest Inc., a JPMorgan Chase & Co. unit that provides an electronic-trading platform, for operating as an unregistered broker-dealer.
The commission on Tuesday said this is the first such charge against a provider of an order and execution management system. It said Neovest agreed to pay $2.75 million in penalty, though the company didn't admit or deny the SEC's findings.
/on.wsj.com/3x9ugwL
| | | | | | Strategy | | | Reflation trade unwind wrongfoots several big-name hedge funds
Colby Smith and Laurence Fletcher - Financial Times
Investors are reassessing their commitment to the reflation trade that has captivated Wall Street this year after a hawkish tilt by the US central bank inflicted losses on some fund managers.
Betting against the price of US government bonds was a winning play earlier this year, with hedge funds and other investors raking in sizeable gains as the economic recovery gathered pace. But recent gyrations and the spectre of a policy pivot from the Federal Reserve have heaped significant doubt on whether investors should remain in the trade.
/on.ft.com/3w5ORRo
Inside Volatility Trading: The Adventures of Volatility Markets
Kevin Davitt - Cboe Insights
Samuel Longhorne Clemens, better known as Mark Twain, has been called "the father of American Literature" (William Faulkner). Twain was a public intellectual and successful author. As such, he's become one of the most (mis)quoted writers/speakers of all time. One frequently mangled missive from June 1897 addressed rumors that he had died:
"I have even heard on good authority that I was dead. The report of my illness grew out of his [Twain's cousin] illness. The report of my death was an exaggeration."
I was reminded of Twain's humorous take when I noticed a tweet from Benn Eifert. For the past few years, market pundits have predicted the demise of option-based volatility selling strategies. In other words, rumors of the death of the "short-vol" trade have been greatly exaggerated.
/bit.ly/3qBfHPW
| | | | | | Miscellaneous | | | Equity commissions in Europe surge 19% from 2019 on market volatility; Bloomberg Intelligence report that polled equity heads and senior traders suggests commissions in Europe will rise 8.8% this year following a period of decline.
Hayley McDowell - The Trade
The global pandemic and market volatility has caused a surge in European equity commissions following a several years of decline, according to a report from Bloomberg Intelligence. Bloomberg polled 87 European institutional equity heads and senior traders and found that a majority of 53% believe their commission payments will increase this year, while 65% expect their value traded in 2021 to also rise.
/bit.ly/3dsVGpI
Archegos Is a Warning for Aggressive Financial Markets, Says BIS
Paul J. Davies - WSJ
The recent failure of U.S.-based Archegos Capital Management, a family office that made large, risky bets on a handful of stocks, could be a sign of how more investors might get tripped up by overreacting to inflationary risks, the global club of central banks warned on Tuesday.
Shocks to financial markets from higher inflation could result from enormous government spending plans and a rapid release of household savings built up during the Covid-19 pandemic, said the Bank for International Settlements, often called the central bankers' central bank.
/on.wsj.com/3w4kfzH
Largest Broker TP ICAP Will Launch Crypto Exchange With Fidelity, Standard Chartered
Samyuktha Sriram - Benzinga
The world's largest interdealer broker TP ICAP Group PLC (LON: TCAP), plans to launch a digital asset exchange after partnering with Standard Chartered PLC (LON: STAN) and Fidelity Investments.
According to a report from Reuters, the platform will allow institutional investors to trade Bitcoin (CRYPTO: BTC). The support for the second-largest cryptocurrency by market cap Ethereum (CRYPTO: ETH) will be added later.
/bit.ly/3qD8gYS
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