 | | | | | | | | November 20, 2024 | | | |  | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | FIA CEO and President Walt Lukken's opening comments yesterday welcomed attendees to FIA Expo in Chicago, expressing relief in escaping Washington's political climate. He emphasized the need for honesty and common sense in addressing industry challenges. Lukken introduced the concept of "Tell the Truth Day," inspired by the Washington Commanders' coach Dan Quinn's "Tell the Truth Mondays." Since he is asking for the truth, I missed his remarks as I was preparing my video set up for an interview with the CFTC chairman following his opening remarks and the last fireside chat with Rostin Behnam as CFTC chair.
Key points from Walt's opening remarks were:
-Global growth in futures and options trading is strong, with 2024 expected to be the seventh consecutive record year.
-The global growth story of our industry is real.
-This industry's growth is fueled by innovation, and we must nurture this environment of risk-taking.
-The laws and regulations of our industry must keep pace with our evolving market structure.
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Catherine Yoshimoto, Director of Product Management, FTSE Russell, Talks With JLN About Investing and Listing Trends
JohnLothianNews.com
FTSE Russell this year is celebrating the 40th anniversary of the launch of Russell Indexes, and Catherine Yoshimoto, Director of Product Management at FTSE Russell, was in Chicago for a special event at the Cboe to mark the occasion. JLN met up with her downtown on Tuesday, November 12th for a chat. Last June, FTSE Russell celebrated the 35th anniversary of the annual reconstitution of the Indexes, which have been rebalanced annually since 1989. Cboe is licensed to offer options on the Russell Indexes, and the CME offers the futures on the Russell Indexes.
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| | | | | | Lead Stories | | | The doomsday that wasn't; VIXplaining the events of August 5
Alexandra Scaggs - Financial Times
One fun thing about the VIX - called the "fear gauge" because it puts a price on expectations for future stock-market volatility - is that it has pretty deep lore. For example, the army of young daytraders who first logged on in 2020 might not know much about 2018's Volmageddon, when an implosion in retail-focused volatility products and swings in the S&P 500 options that determine VIX levels helped exacerbate declines in the large-cap index itself. It also may not be obvious that it's a mathematically iffy business to talk about its moves in percentages, because it's basically a standard deviation, or a percentage itself.
/jlne.ws/3Om7H1W
Bitcoin Rises to Record With MicroStrategy Stepping Up Purchases; Nasdaq listed options on the $44 billion iShares Bitcoin ETF; Investors are betting on further record highs for the token
Suvashree Ghosh and Emily Nicolle - Bloomberg
Bitcoin climbed to a record high for a second consecutive day, with MicroStrategy Inc. accelerating the pace of its massive purchases of the cryptocurrency.
The largest publicly traded corporate holder of Bitcoin announced Wednesday that it was increasing the amount of convertible senior notes it plans to sell to fund additional purchases of the token by almost 50% to $2.6 billion. MicroStrategy, which announced earlier this week that it bought $4.6 billion of the token, owns more than $30 billion.
/jlne.ws/4fAcI3b
Bitcoin Sets Another Record Amid US's Growing Embrace of Crypto; Potential Trump Media crypto deal bolsters sentiment; Nasdaq lists options on the world's largest Bitcoin fund
Sunil Jagtiani - Bloomberg
Bitcoin set another all-time high, supported by a series of developments highlighting the deepening embrace of the digital-asset industry in the US under crypto cheerleader Donald Trump. At the top of the tape was the revelation that the president-elect's Trump Media & Technology Group Corp. is in talks to buy digital-asset marketplace Bakkt Holdings Inc., which sparked a surge in the shares of both companies. Other developments included Nasdaq Inc.'s listing of options on the $43 billion iShares Bitcoin Trust for the first time and Goldman Sachs Group Inc.'s push to spin out its digital-asset platform, signs of how crypto and its underlying blockchain technology are burrowing deeper into the financial system.
/jlne.ws/48XyY4q
Bridgewater opens strategy to retail investors through State Street ETF; Move by famously secretive hedge fund follows others in rushing to ink deals with big names in alternative assets
Brooke Masters - Financial Times
Bridgewater, one of the world's largest hedge funds, is joining forces with State Street's asset management arm to tap retail investors in the latest effort by money managers to look for new customers beyond their traditional strengths. The partnership announced on Tuesday will start with an exchange traded fund that will track one of Bridgewater's best-known strategies. State Street Global Advisors has filed plans with the US Securities and Exchange Commission for an "All-Weather" ETF, which seeks to profit in all types of market conditions by holding a wide range of assets.
/jlne.ws/4fCbBQm
Bridgewater + SSGA = ETF heaven; The 'original Coke' of risk parity is getting bottled up
Robin Wigglesworth - Financial Times
Bridgewater and State Street have just announced a "strategic relationship" to "widen access to core alternative investment strategies". What does this actually mean? Well, it means a risk parity ETF! Look at what just landed in the SEC's filing cabinet:
/jlne.ws/3V1OGWy
'FIRE' ETFs Catering to Retire-Early Strivers Make a Debut; Tidal offerings cater to community ignored by Street, CIO says; Acronym-based investing approach has poor record: Morningstar
Vildana Hajric - Bloomberg
It's a pipedream for many, but a trend that espouses making and saving enough money to quit a soulless day job and retire early has inspired a pair of new ETFs. Scan any TikTok or Instagram feed lately and you'll be awash with advice on how to achieve the goals of the Financial Independence Retire Early, or FIRE, movement. On Tuesday, Tidal Investments introduced the first ETFs - the FIRE Funds Wealth Builder ETF (ticker FIRS) and the FIRE Funds Income Target ETF (FIRI) - to directly cater to those looking to achieve that job-free lifestyle.
/jlne.ws/4eFwnNG
Citadel's Ken Griffin Says Multistrategy Hedge Fund Boom Is Over; Trump's win reignited animal spirits in America, says Griffin; Billionaire says money deployed in US basis trade has fallen
Nishant Kumar - Bloomberg
The era of explosive growth in multistrategy hedge funds is over, according to billionaire Ken Griffin, who runs one of the biggest such firms. "That chapter has come and gone," the Citadel founder said in an interview with Bloomberg News in Oxford, UK. "The AUM flows into multistrategy funds are basically a push today." These funds have gobbled up cash in recent years by delivering mostly steady gains even during periods of market volatility, driven by a broad variety of investing approaches in their trading teams. Their ability to charge higher fees, spend big to recruit the best traders and fuel their positions with borrowed money have made them the most influential force in the $4.5 trillion hedge fund industry.
/jlne.ws/3YWaBzA
Roubini Launches Treasury-Alternative ETF to Ride Trump-Era Risk; ETF serves as hedge against geopolitical, economic tail risks; USAF launches Wednesday with expense ratio of 75 basis points
Isabelle Lee and Tracy Alloway - Bloomberg
Nouriel Roubini is seizing on Donald Trump's inflation-threatening policy agenda to make a case for an alternative haven trade to Treasuries in a world of elevated volatility.
The economist, who built his reputation by correctly warning of a disaster ahead of the 2008 financial crisis, said the popular 60/40 portfolio is braced for pain once more, with Trump's tariff plan - even just a "mild version" - threatening price stability.
/jlne.ws/4fC2FKL
| | | | | | Exchanges | | | Miami International Holdings Chairman and CEO Thomas P. Gallagher Named to TabbFORUM 40 for Third Consecutive Year
MIAX Press Release
Miami International Holdings, Inc. (MIH), a technology-driven leader in building and operating regulated financial markets across multiple asset classes, proudly announced that its Chairman and CEO Thomas P. Gallagher was named to the 2024 TabbFORUM 40, an honor roll of executives and other influencers who are leading technology-driven innovation and disruption in financial markets. This is the third consecutive year that Mr. Gallagher has been named as a recipient of the TabbFORUM 40 award since its introduction in 2022.
Mr. Gallagher is one of MIH's principal founders, becoming chairman in 2008 and leading the company since 2012 when the first of its MIAX electronic options exchanges launched. Since then, he has overseen the company's rise to becoming the fifteenth largest derivatives exchange operator in the world as of September 30, 2024, as measured by the total number of futures and options contracts traded on exchanges reported by Futures Industry Association.
/jlne.ws/3Z0iDar
| | | | | | Regulation & Enforcement | | | CFTC Chair Says Still Weighing Clearing US Treasuries Abroad; Derivatives regulator is working with Treasury; weighing risks; Behnam won't finalize ban on political contracts before Trump
Isis Almeida, Lydia Beyoud, and Katherine Doherty - Bloomberg
The top US derivatives regulator is still assessing the risks of clearing US Treasuries abroad, an outcome that could impact plans by Cantor Fitzgerald LP Chief Howard Lutnick to compete with CME Group Inc. The Commodity Futures Trading Commission continues to work with the Treasury Department on the assessment, Rostin Behnam, the agency's chairman, said. His comments follow a letter sent by Democratic Senator Dick Durbin of Illinois - CME's home state - warning the agency of possible risks to the stability of the US sovereign-debt markets should US Treasury futures be cleared in foreign jurisdictions.
/jlne.ws/40QMC7x
SEC Charges Richmond Federal Reserve Banking Supervisor with Insider Trading
SEC
On November 8, 2024, the Securities and Exchange Commission filed insider trading charges against Robert Brian Thompson, a long-time banking supervisor and examiner at the Federal Reserve Bank of Richmond, for allegedly using material nonpublic information to trade in stock and options of two publicly traded banks that were under his supervisory purview.
/jlne.ws/3CCVK5y
| | | | | | Strategy | | | How Options Traders Should Play Thanksgiving Week
Rocky White - Schaeffer's Investment Research via Yahoo Finance
Thanksgiving is next week, and you can probably expect low volumes during the holiday-shortened trading. Markets are closed on Thursday and open for half a day on Friday, closing at 2 p.m. E.T. To prep for this unique week, I broke down how markets have performed during the week, and which stocks have stood out over the holiday.
Overall, Thanksgiving week has tended to be bullish. Over the past 50 years, the S&P 500 Index (SPX) has gained on average 0.64% during the week, with 70% of the returns positive. Other weeks average a gain of 0.17% and positive 56% of the time.
/jlne.ws/4eI0STj
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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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