| | | | | | | | December 05, 2024 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |
Don Morton, My Second Client as a Full-service Broker, Has Passed Away at Age 89
JohnLothianNews.com
His Highly Complex Bond Option Position Helped Get Me Fired From First American, But It Was Not His Fault
Don Morton, the second futures brokerage account I ever opened as a full-service futures broker, passed away on Monday, December 2, 2024, at the age of 89. Don was a brilliant options trader who served as the executive director of the Tennessee Legislature's Fiscal Review Committee. He was also a U.S. Army veteran of the Korean War and a certified public accountant.
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| | | | | | Lead Stories | | | Traders Are Capitalizing on the Slump in Stock-Market Volatility
Jan-Patrick Barnert - Bloomberg
Volatility has fallen through the floor, and traders are enjoying it.
The VIX index briefly slid below 13 points on Wednesday, its lowest level since July. Investors still unwinding left-over US election hedges while also chasing exposure into the year-end have led to a surge in options selling and a suppression of market swings.
Systematically shorting S&P 500 Index puts and strangles each day is back to being more attractive than simply buying stocks, Nomura cross-asset strategist Charlie McElligott wrote in a note. The Sharpe ratio, a measure of risk return, has risen to about 19 points for those options strategies, compared with 15 points for holding shares, he added.
/jlne.ws/4gl3mbl
US equity options markets report strong November for trading
Gregory Rosenvinge - FOW
Cboe Global Markets has reported trading volumes up 18% in November for its US single stock options listed on multiple exchanges while Miami International Holdings (MIH) saw options volumes rise 35% to a new record level.
/jlne.ws/3D4C3nC
BMLL Expands into Options as Market Data Costs 'Spiral'
Press Release via The Trade
BMLL, which provides harmonized, historical data and analytics, has expanded into options as global trading volumes are expected to be another record this year.
Paul Humphrey, chief executive of BMLL, told Markets Media that this was the first time the firm expanded outside its traditional asset classes of equities, exchange-traded funds and listed futures. He said: "Options data is generated by the same exchanges that we deal with but has many of its own challenges. The options data set is enormous."
/jlne.ws/4ipQN0f
New 'anti-woke' ETF makes Starbucks its first target; Azoria Partners will hold event at Donald Trump's Florida resort on Thursday
Amelia Pollard and James Fontanella-Khan - Financial Times
A new fund aiming to punish "woke" companies will make Starbucks its first target, as politically motivated investors move to capitalise on Donald Trump's election. The actively managed fund, which Azoria Partners expects to launch early next year, will exclude S&P 500 companies that incorporate diversity, equity and inclusion considerations into their hiring processes.
/jlne.ws/3OGrglX
Wall Street's Go-Go Era Builds With Levered Stock-Crypto Gambit
Isabelle Lee and Lu Wang - Bloomberg
It's the latest high-octane offering from Wall Street's rapidly growing line-up of risky ETF filings: Leveraged products that amp up exposures to large-cap stocks and crypto in one fell swoop - giving traders a way to double down on two of this year's best-performing assets. Florida-based Volatility Shares filed last week to launch a series of exchange-traded funds that seek to layer equity investments on top of digital tokens. The pitch is that by going all-in on derivatives, investors can get a $100 bet on US shares along with $100 of crypto exposure, for just a $100 outlay in total.
/jlne.ws/3OCRA0m
Hedge Funds Make MicroStrategy Wall Street's Hottest Trade
Yiqin Shen - Bloomberg
To sate his multibillion dollar rampant appetite for Bitcoin, Michael Saylor has tapped demand from retail investors transfixed by MicroStrategy Inc.'s more than 500% rally this year. He's also benefited from hedge funds who care far less where the stock trades. Calamos Advisors LLC co-Chief Investment Officer Eli Pars has been among the buyers for more than $6 billion of convertible notes sold by MicroStrategy this year to finance the purchase of his ever-expanding cryptocurrency hoard. Like many other managers, Pars uses the notes in market-neutral arbitrage bets that exploit the surging volatility of the underlying asset.
/jlne.ws/3ZlkwPd
Bitcoin Hits $100,000, Lifted by Hopes of a Crypto-Friendly Washington; Some market veterans see irony in crypto's embrace of political power
Alexander Osipovich - The Wall Street Journal
Bitcoin traded above $100,000 for the first time late Wednesday, powered by a wave of investors betting that President-elect Donald Trump will turn U.S. government policy into an engine of growth for crypto.
The world's largest digital currency has staged an extraordinary rally since Election Day, surging more than 40% in just four weeks and setting one record after another. It surged as high as $103,853 after Trump picked Paul Atkins, a crypto-friendly former regulator, to lead the Securities and Exchange Commission. During the campaign, Trump dropped his earlier skepticism of bitcoin and promised to "end Joe Biden's war on crypto."
/jlne.ws/3ZpwTdi
Bitcoin Traders Shrug at $2.8 Billion Mt. Gox Transfer
Vince Dioquino - DeCrypt
A wallet associated with Mt. Gox transferred 27,871 Bitcoin worth $2.8 billion amid Bitcoin's breakthrough above $100,000, late Wednesday evening. It was a show of unprecedented resilience for traders in the face of large-scale transfers, which have historically triggered volatility. The transfer, tracked by blockchain analytics firm Arkham Intelligence, directed 27,871 Bitcoin to an unmarked address.
/jlne.ws/3ZjMvip
Crypto Trading Volume Surged to $10 Trillion for the First Time in November; Combined spot and derivatives volume doubled, CCData says; Trump's election victory triggered a 'risk-on' rally
Olga Kharif - Bloomberg
Crypto trading volume climbed to an all-time high in November, with more than $10 trillion of digital assets changing hands for the first time on centralized spot and derivatives exchanges. The combined volume doubled last month, according to data compiled by CCData. Crypto markets surged amid optimism for a friendlier regulatory environment for the industry under the newly elected Trump administration, with market bellwether Bitcoin jumping 38% and setting a record high of almost $100,000.
/jlne.ws/3Vp0ouG
| | | | | | Exchanges | | | Cboe Global Markets Reports Trading Volume for November 2024
Cboe
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, today reported November monthly trading volume statistics across its global business lines. The data sheet "Cboe Global Markets Monthly Volume & RPC/Net Revenue Capture Report" contains an overview of certain November trading statistics and market share by business segment, volume in select index products, and RPC/net capture, which is reported on a one-month lag, across business lines.
/jlne.ws/3ZmNkHl
Robinhood's Hot New Tech Bet: The Desktop Computer; Upstart online brokerage is aiming to be top destination for serious traders who prefer to click around on their big screens
Telis Demos - Bloomberg
To go forward, Robinhood Markets says it must go backward. In its early days, a decade ago at this point, the online brokerage began making headway into the crowded business of stock and options trading partly by making it easy to do so via mobile devices. That helped it become a pathway into investing for many younger people, though it also drove some of the criticism of its service as a "gamification" of the industry. But at Robinhood's first-ever investor day on Wednesday, speaking now as a $35 billion market cap company, the onetime upstart said it believes it must go back to what might seem like an older technology-the computer desktop-as a pillar of its growth over the next few years. That is because the company is aiming to become the No. 1 platform for serious retail traders, or what it terms active traders.
/jlne.ws/4gnanbY
Index Insights: November 2024
Cboe
U.S. equity markets had a strong performance in November following the results of the U.S. elections. Investors viewed the outcome of the U.S. elections favorably, with the expectation of a pro-growth policy environment in the near term. The Russell 2000Ã Index (RUT), which is more industrially focused, saw the strongest returns rising nearly 11%. Meanwhile, the S&P 500Ã Index (SPX) gained more than 5.7%, setting record highs above 6,000.
Implied volatility, which had remained elevated due to concerns about the potential aftermath of the election, experienced one of its sharpest declines on record. The VIXÃ Index decreased nearly 8 points, or 34%, in the first week of November, finishing the month near 13.50, almost 10 points lower than its October 31 level. This helped fuel moderate gains in both buy-write and put-write strategies, particularly in the Russell 2000 Index. Notable performance was seen in the Cboe Russell 2000 Daily Covered Call Index (RTYDCC), which rose nearly 7.6%, and the Russell 2000 PutWrite Index (PUTR), which gained 6.82%.
/jlne.ws/4ipCARg
November 2024 figures at Eurex
Eurex
Eurex, Europe's leading derivatives exchange and - with Eurex Clearing - one of the leading central counterparties globally, reported a 6 percent increase in total trading volume for November, reaching 177.6 million contracts, up from 167.5 million contracts in the same month last year. The growth was primarily driven by interest rate derivatives, which rose by 8 percent from 77.4 million to 83.7 million contracts. Equity derivatives also experienced strong growth, climbing 40 percent to 32 million contracts. However, index derivatives saw an 11 percent decline, falling from 67.1 to 59.7 million traded contracts.
CME Group to Launch 1-Ounce Gold Futures to Meet Surging Retail Demand
CME Group
CME Group, the world's leading derivatives marketplace, today announced it will launch a 1-Ounce Gold (1OZ) futures contract on January 13, 2025, pending regulatory review.
/jlne.ws/3DbcL6Z
CME Group Announces $2.1B Annual Variable Dividend and $3B Share Repurchase Program
CME Group
CME Group, the world's leading derivatives marketplace, announced that its Board of Directors approved two initiatives to return capital to shareholders. The Board declared the company's 2024 annual variable dividend, amounting to $5.80 per share. The dividend is payable January 16, 2025, to shareholders of record on December 27, 2024, and totals approximately $2.1 billion. In addition, the Board authorized a share repurchase program of up to $3 billion of CME Group Class A common stock, subject to market conditions.
/jlne.ws/49qi2DN
| | | | | | Technology | | | Cboe BZX Options Exchange no longer pursues 10 Gb Layer 1 Physical Ports initiative
Maria Nikolova - FX News Group
Cboe BZX Options Exchange is no longer pursuing the previously announced 10 Gb Layer 1 Physical Ports initiative.
If the Exchange chooses to pursue this initiative at some point in the future, such plans will be communicated in advance in a future notice.
The ports were supposed to be introduced on December 9, 2024.
/jlne.ws/3B4wWmN
| | | | | | Strategy | | | Diversify Your Portfolio with ETFs From Abroad
Michael "Dr. Data" Rechenthin - tastylive
Equities that don't correlate with the S&P 500 can smooth out the ups and downs
Many of us are heavily invested in S&P 500 stocks, which have performed well year-to-date (SPY +27.5%). But how can one diversify in other markets outside the U.S.? Here are some ideas.
/jlne.ws/3ZARHQd
| | | | | | Miscellaneous | | | Government Jobs at This Agency Pay $248,000. Here's Where Federal Workers Make the Most Money.
Anita Hamilton - Barron's
A lesser-known agency with fewer than a thousand employees is at the top of the federal pay scale. Workers at the Commodity Futures Trading Commission, which regulates futures, options, and other derivatives, have a median pay just shy of $248,000, according to the latest data from the Office of Personnel Management-more than twice what a typical federal worker earns.
/jlne.ws/3Bnizd6
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