| November 04, 2024 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | OCC October 2024 Monthly Volume Data
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Thomas Peterffy on ForecastEx: Building a Buy-Only Market to Transform Event Trading and Crowd-Based Insights
JohnLothianNews.com
Thomas Peterffy, founder of Interactive Brokers, shares insights into his latest venture, ForecastEx, an innovative platform designed to create a new market for event-based contracts in an interview with John Lothian News. ForecastEX provides traders a unique "buy-only" model where participants take yes or no positions on the probability of future events, challenging traditional speculation while aiming to yield broader societal insights.
Watch the video »
| | | | | | Lead Stories | | | T-1: Election Risk Premium Surges into US Elections
Ed Tom - Cboe
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The VIX Surges Ahead of the Election: What It Means; The VIX hit the highest level since August as investors brace for election-related volatility.
Sumit Roy - ETF.com
Tuesday is Election Day and investors are bracing for some volatility. Late last week, the Cboe Volatility Index, also known as "The VIX," topped 23 for the first time since August, suggesting that some investors are hedging their stock exposure with options ahead of the vote.
Meanwhile, the ICE BofA MOVE Index, a measure of expected U.S. bond market volatility, eclipsed 135, its highest level since Oct. 2023.
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This chart shows where VIX historically stands the day before election day
Christine Idzelis - MarketWatch
The stock market's volatility gauge was rising Monday, the day before U.S. election day.
"With the polls so close between two completely different candidates, it's understandable to see elevated levels of uncertainty in the market," Bespoke Investment Group said in a note Monday.
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Pre-election volatility: VIX moves above its 200-day average
Madison Mills - Yahoo Finance
The Cboe Volatility Index (VIX), which measures market volatility, has moved above its 200-day moving average ahead of Tuesday's 2024 presidential election.
Yahoo Finance anchor Madison Mills joins the Morning Brief team to discuss elevated volatility fueled by pre-election uncertainties, coinciding with the Federal Reserve's November meeting on interest rates this week, and Wall Street's consensus on this earnings season.
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Traders braced for volatility and volume as US election night nears; Banks plan staggered shifts and downtown hotel rooms for suburb dwellers to staff floors around tight race outcome; Options markets are pricing in a potential swing of plus or minus 2.2% in the S&P 500 after election night, according to Cboe
Harriet Clarfelt and Nicholas Megaw - Financial Times
Bankers, traders and investors are bracing themselves for a long stint of high volumes and increased volatility, particularly in bond and currency markets, ahead of Tuesday's US presidential election.
With markets already pricing in potentially large swings across several asset classes, Wall Street banks have been preparing well in advance - with some pausing software updates and booking downtown hotel rooms for suburb-dwelling traders, to make sure they are ready to handle any unexpected moves on election night or throughout the rest of the week.
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Traders Prepare for a Long, Volatile Election Night; As the results trickle in, some highly caffeinated investors will be watching margins and tweaking their wagers until sunrise.
Katherine Burton and Liz Capo McCormick - Bloomberg
For the big money on Wall Street, there's the prep that's bound to come with a coin-toss election that could dramatically swing policy. Trading desks staffed through the night, with teams in Hong Kong and Singapore enlisted to help. Tracking popular "Trump trades" - long the dollar, short bonds - ready to pile in or quickly unwind. And then there are the steps taken for an election season like no other. One London-based hedge fund primed its "shock" computer model especially for this moment. Banks are preparing for the risks, however remote, of civic violence - a prospect that would shake the US, the world and global financial markets.
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Two Funds Locked in a Dead Heat for a Questionable Crown; Leverage levels are playing an increasingly important role in attracting investors
Katie Greifeld - Bloomberg
The two-fund race to create the US market's most volatile ETF rages on. Defiance announced this week that it's bumped up the leverage level on its Defiance Daily Target 2X Long MSTR ETF (ticker MSTX) to 2x from 1.75x, matching that of rival T-Rex 2X Long MSTR Daily Target ETF (MSTU). Both funds seek to track the amplified performance of MicroStrategy Inc., which is already a juiced-up bet on Bitcoin. With the latest leverage increase, both MSTX and MSTU effectively offer 4x exposure to the cryptocurrency, according to Bloomberg Intelligence's Eric Balchunas.
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$Pepe Whale Sell-Off And Fund Transfers Stir Volatility In Meme Coin Market
Will Izuchukwu - The Merkle
Recently, major $PEPE holder Flow Traders transferred 520 billion $PEPE tokens-worth approximately $4.73 million-from address 0x01c...1980e after a five-month hold. This receiving address has shown frequent $PEPE trading activity over the past seven months, with its latest transaction occurring two weeks ago during a peak in $PEPE's price. Currently, the transferred tokens remain unmoved and have not been sent to any exchange, leaving their future movement uncertain.
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The Vote Is In: Stock Funds Are Up 14.9% in 2024; Investors await the end of election uncertainty. Plus: A Financial Flashback to 25 years ago, when four 'New Economy' stocks joined the Dow.
William Power - The Wall Street Journal
One of the oldest investing maxims is that investors hate uncertainty. And there could be just a little of that ahead of Election Day. But no matter what happens at the ballot box, the stock market is holding on to solid gains so far in 2024. And history has shown that just getting past the election is helpful for the market, no matter who wins. "Election-driven volatility has historically been short-lived-even if the results of the election were not immediately known, as in 2000," says Saira Malik, chief investment officer at Nuveen.
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Investors step up bets that US election will trigger market volatility; Jitters sweep through bond and currency markets before presidential vote
Will Schmitt and Nicholas Megaw - Financial Times
Investors have been raising their bets that next week's US presidential election will trigger sharp price swings in bond and currency markets. The Ice BofA Move index, a closely watched gauge for future moves in the Treasury market, is up almost 40 per cent in October and hit its highest level in more than a year earlier this week. "The most realistic near-term risk is the outcome of the election," said Steven Oh, global head of credit and fixed income for PineBridge Investments.
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Bitcoin Traders Brace for Fierce Price Swings as Clock Ticks to US Vote; Gauge of expected Bitcoin volatility hits a three-month high; Bitcoin Trump trade cooled amid a tight US election contest
Suvashree Ghosh and Sidhartha Shukla - Bloomberg
Bitcoin speculators are bracing for potentially pronounced market volatility in the aftermath of Election Day in the US on Tuesday.
A 30-day gauge of implied swings in the largest digital asset has hit the highest level since a global market rout roiled investors in August. The index, compiled by CF Benchmarks Ltd., is derived from CME Group Bitcoin options pricing.
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| | | | | | Exchanges | | | Cboe Equities introduces new Cboe Timestamping Service
Maria Nikolova - FX News Group
All Cboe-affiliated U.S. Equities Exchanges have introduced the new Cboe Timestamping Service to provide market participants with additional order and cancel related timestamp information.
This service will enable Members to self-subscribe and receive timestamp information on a T+1 basis for select messages.
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CME Group Reports October 2024 ADV of 24.3 Million Contracts
CME Group
CME Group, the world's leading derivatives marketplace, today reported its October 2024 market statistics, with average daily volume (ADV) reaching 24.3 million contracts, the second-highest October volume ever. Market statistics are available in greater detail at https://cmegroupinc.gcs-web.com/monthly-volume.
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Mercuria and HNK Alpha Execute First Carbon Futures Block Trades on Abaxx Commodity Futures Exchange and Clearinghouse
Abaxx
Abaxx Technologies Inc. (CBOE CA:ABXX)(OTCQX:ABXXF) ("Abaxx" or the "Company"), a financial software and market infrastructure company, majority shareholder of Abaxx Singapore Pte Ltd. ("Abaxx Singapore"), the owner of Abaxx Commodity Exchange and Clearinghouse (individually, "Abaxx Exchange" and "Abaxx Clearing"), and producer of the SmarterMarkets⢠Podcast, today announced the execution of the first two carbon futures block trades, traded between Mercuria and HNK Alpha on October 30, 2024.
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| | | | | | Regulation & Enforcement | | | State Street Asks SEC for Blessing to Fit ETFs into 401(k) Plans; Firm is looking to create mutual fund share classes of ETFs; US retirement structure is currently built around mutual funds
Katie Greifeld - Bloomberg
State Street Global Advisors is taking a page from Vanguard Group Inc.'s blueprint for multi-share classes to further its bid to insert exchange-traded funds into the American retirement system. The firm on Friday filed for permission to create mutual funds as a share class of its ETFs, which would be "specifically designed for, and only available to, investors purchasing through a retirement plan." It's essentially the inverse of the Vanguard-pioneered structure of issuing ETF share classes of its existing mutual funds - a process that more than 30 issuers have sought to replicate since Vanguard's patent expired in May 2023.
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Chinese Hedge Fund Manager Indicted by US in Trade Secrets Case
Bloomberg
A co-founder of high-flying Chinese quantitative hedge fund Pinestone Asset Management Co. has been indicted in the US for alleged theft of trade secrets, according to people with knowledge of the matter. Xiao Zhang, a 33-year-old Chinese citizen from Shanghai, was indicted by a federal grand jury in Boston for allegedly stealing secrets from an unidentified global investment management firm while he was working for it in 2021, according to a statement dated Oct. 31 from the US Attorney's Office in Massachusetts. The statement didn't provide any further details about Zhang's identity.
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| | | | | | Strategy | | | Prepare for market volatility but don't panic trade, analysts say ahead of Election Day
Theron Mohamed - Business Insider
Market analysts are braced for volatility ahead of Tuesday's presidential election as traders shuffled their bets on a Donald Trump or Kamala Harris victory.
The Republican and Democratic candidates are neck and neck in many polls, fueling uncertainty in the finance world over who'll emerge triumphant, and clouding the outlook for everything from tax and trade policy to corporate regulation and geopolitics.
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Some traders see opportunity in Wall Street's election-related anxiety; Late last week, traders piled into bets that Wall Street's 'fear gauge' would decline
Joseph Adinolfi - MarketWatch
Wall Street is still on edge ahead of Tuesday's U.S. election. But some traders appear to be getting a head start on bets that a relief rally will take hold once the vote tallies are known.
To wit, trading in put options tied to the Cboe Volatility Index, known as Wall Street's "fear gauge," soared on Friday relative to trading in call options. By the time the market closed, activity in puts had surpassed that in calls by the widest margin in four years, FactSet data showed.
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How to Play New Options Trading With Bitcoin ETFs
Nathan Reiff - MarketBeat via MSN
In late October 2024, the burgeoning Bitcoin ETF industry moved a step closer to the traditional financial landscape for investors when the SEC approved proposals from both NYSE American and Cboe to list and trade options on a number of Bitcoin ETFs. This could be seen as a signal that U.S. regulators are increasingly comfortable viewing Bitcoin and related investment vehicles as a mainstream tool for investors.
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| | | | | | Miscellaneous | | | Republicans' Closing Argument: We Will Wreck the Economy; The former president's allies have used the final days of the campaign to argue for sharp spending cuts that would harm millions of Americans.
Matthew Yglesias - Bloomberg Opinion
In the closing days of the presidential campaign, Donald Trump's allies suddenly have a new message: The US needs sharp, immediate and ill-defined spending cuts. Elon Musk, who's been talking about immigration for more than a year, now says he's going to oversee $2 trillion in reductions. That's a third of the federal budget, so you'd think there might be some kind of plan for what this involves, but all Musk would say last week is that "temporary hardship" will be involved. What kind of hardship? Well, House Speaker Michael Johnson let it be known last week that "health care reform's going to be a big part of the agenda" if Trump wins, including a "very aggressive" attempt to repeal the Affordable Care Act. Hedge fund billionaire John Paulson, a Trump supporter, also weighed in last week about the need for steep cuts.
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Meta's plan for nuclear-powered AI data centre thwarted by rare bees; Mark Zuckerberg is continuing to explore energy deals amid a Big Tech arms race over artificial intelligence
Hannah Murphy and Cristina Criddle - Financial Times
Plans by Mark Zuckerberg's Meta to build an AI data centre in the US that runs on nuclear power were thwarted in part because a rare species of bee was discovered on land earmarked for the project, according to people familiar with the matter. Zuckerberg had planned to strike a deal with an existing nuclear power plant operator to provide emissions-free electricity for a new data centre supporting his artificial intelligence ambitions. However, the potential deal faced multiple complications including environmental and regulatory challenges, these people said. The discovery of the rare bee species on a location next to the plant where the data centre was to be built would have complicated the project, Zuckerberg told a Meta all-hands meeting last week, according to two people familiar with the meeting.
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****** I can't wait for the Saturday Night Live take on this story.~JJL
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