| August 24, 2021 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | ****JJL: Our reworking of The Spread continues. This last week we broke up the video into three separate pieces to make it easier to watch the part that interests you the most. Also, people tend to like and watch shorter videos.
The first section is Options News by Suzanne Cosgrove. She looks at some of the biggest stories in the options world for the previous week. The next part is John's Take. I will leave you to guess who produces this section. Lastly, we have Term of the Week, where we ask options professionals to give their definition of key options terms. If it is all Greek to you, this is your chance to learn more about options. This week Jermal Chandler of Tastytrade explains why you need to keep a close watch on gamma.
We will also be adding other sections to The Spread from time to time, including interviews. Stay tuned.
| | | | | | Lead Stories | | | Opinion: The future of global growth is in peril
Michael Spence - MarketWatch
As recently as three months ago, the global economy seemed to be on track for a relatively robust recovery. The supply of COVID-19 vaccines had expanded in the developed countries, raising hopes that it would spill over to developing countries in the second half of 2021 and into 2022. Many economies were posting impressive growth numbers as pandemic-suppressed sectors reopened. While clogged supply chains had produced a host of shortages and high prices for key inputs, these were seen as merely transitory problems.
/on.mktw.net/3sGYV2Y
Wall Street stocks inch to record highs while Europe wavers
Siddharth Venkataramakrishnan - Financial Times
US stocks edged up to a new all-time peak on Tuesday and commodities advanced in contrast to losses incurred in a blast of nerves last week over the Delta variant of coronavirus.
Wall Street's S&P 500 ticked up 0.2 per cent and the Nasdaq Composite rose 0.4 per cent. Across the Atlantic, it was a mixed session; the region-wide Stoxx 600 closed flat while France's Cac 40 lost 0.3 per cent. Germany's Dax rose 0.3 per cent, while London's FTSE 100 ended the day 0.2 per cent higher.
/on.ft.com/3y8Hv0x
Investors are taking hard-to-ignore inflation `seriously' when it comes to their portfolios
Vivien Lou Chen - MarketWatch
Investors are taking the current wave of higher U.S. inflation as reason to consider tweaking their portfolios, by investing in stocks sensitive to higher interest rates.
Those are the findings of a quarterly tracking study of experienced investors by E*TRADE Financial Holdings, released Tuesday. The study shows that over two out of five investors, or 43%, are considering making such a move â even though the majority, or 78%, believe recent high inflation readings are transitory as does the Federal Reserve.
/on.mktw.net/3gtPP4Y
Hedge funds' bullishness on oil ebbs away: Kemp
John Kemp - Reuters
Hedge funds sold petroleum for the seventh time in nine weeks, as rising coronavirus infections in the major oil-consuming markets dampened hopes for an early resumption of long-haul passenger aviation.
Hedge funds and other money managers sold the equivalent of 40 million barrels in the six most important futures and options contracts in the week to Aug. 17, taking total sales to 253 million barrels since June 15.
/reut.rs/3sJVc4S
| | | | | | Exchanges | | | Micro Treasury Yield Futures Surpass 30,000 Contracts Traded
CME Group
CME Group, the world's leading and most diverse derivatives marketplace, today announced that Micro Treasury Yield futures traded 32,247 contracts during the first week and open interest reached 3,296 contracts.
"We're pleased with the early support we've seen from clients and market participants for our new Micro Treasury Yield futures contracts during their first week of trading," said Agha Mirza, CME Group Global Head of Rates and OTC Products. "Micro Yield futures complement our robust suite of U.S. Treasury futures and options, and are our first contracts to reference the yield of on-the-run Treasury securities."
/bit.ly/2WlPcD4
Market for Underlying Security Used for Openings on MIAX Options, MIAX Pearl Options and MIAX Emerald Options for Symbol HEXO Effective Tuesday, August 24, 2021
MIAX
HEXO Corporation ("HEXO") will transfer primary listing from the New York Stock Exchange to the NASDAQ Global Select Market ("NASDAQ") effective Tuesday, August 24, 2021.
MIAX Options, MIAX Pearl Options and MIAX Emerald Options will use NASDAQ as the "market for the underlying security" for the purpose of Openings on the Exchange.
/bit.ly/3B8gJHj
Eurex Bitcoin ETN Futures are "Huge Step Forward"
MarketsMedia
The listing of futures on bitcoin exchange-traded notes by Eurex, Deutsche Börse derivatives arm, will facilitate more advanced investment strategies and bring in a new class of investor to the cryptocurrency market.
Eurex said in a statement that bitcoin ETN futures are due to launch on 13 September.
Deutsche Börse said the contracts offers clients access to the price of bitcoin in a regulated on-exchange and centrally cleared environment. The exchange added that the offering will be the first regulated market in Bitcoin-related derivatives in Europe.
/bit.ly/3jc6cVm
| | | | | | Regulation & Enforcement | | | CFTC reminds SEC "We regulate derivatives not digital assets"
Commissioner Dawn Stump made the clarification ahead of court date for SEC vs Ripple
Sam Cooling - Coin Rivet
The Commodities Future Trading Commission (CFTC) has clarified its role on cryptocurrency regulation following a recent public spat with the Securities and Exchange Commission (SEC).
CFTC Commissioner Dawn DeBerry Stump sought to provide clarification on the nature of the regulatory agency's work and how this will relate to the regulation of digital assets in the United States.
"There has often been a grossly inaccurate oversimplification offered which suggests [crypto assets] are either securities regulated by the Securities and Exchange Commission, or commodities regulated by the Commodity Futures Trading Commission," she said.
/bit.ly/38gAfVz
| | | | | | Moves | | | VIX Trader Benjamin Texier Is Leaving Millennium to Join JPMorgan
Alex Morrell - Business Insider
A Citigroup VIX trader left this spring for $53 billion hedge fund Millennium Management amid scorching demand for volatility traders. Now, he's back on the sell-side, joining JPMorgan's equity derivatives group.
Benjamin Texier has resigned from Millennium and is joining JPMorgan to trade the CBOE Volatility Index, according to sources familiar with the matter.
A JPMorgan spokeswoman and a Millennium spokesman declined to comment.
/bit.ly/3sJw3XR
| | | | | | Strategy | | | September 29th Options Now Available For SPDR S&P 500 ETF Trust (SPY)
BNK Invest via Nasdaq
Investors in SPDR S&P 500 ETF Trust (Symbol: SPY) saw new options become available today, for the September 29th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the SPY options chain for the new September 29th contracts and identified one put and one call contract of particular interest.
/bit.ly/2XXGgF7
Diversification benefits of employing a long volatility allocation
A systematic approach to creating portfolio protection
Nicolas Rabener - ETF Stream
We started our exploration of long volatility strategies by analysing the Eurekahedge Long Volatility Hedge Fund index and highlighted that this would have provided investors with attractive diversification benefits since 2004. However, the index suffers from survivorship bias and requires investors to conduct due diligence on mostly complex option-based strategies, which are rather unattractive features.
/bit.ly/3ko9bt9
| | | | | | Miscellaneous | | | Lunar Tides, the VIX and Volatility
Rick Roche - Advisor Perspectives
This is part 2 of a two-part series on analogies used in investment management. Analogies play an important role as heuristics to aid in discovery and comprehension. But the problem with many of those analogies is that they are shopworn, stale, and tired tropes.
This article explains how the VIX Index and volatility revert to the mean and why a variance risk premium occurs.
/bit.ly/38cr2h3
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