| September 01, 2021 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | Wall Street Traders Driving S&P 500 Records Loaded Up On Hedges
Yakob Peterseil and Anchalee Worrachate - Bloomberg
Stocks may have just wrapped up August with 12 record closes, but Wall Street investors aren't losing all self-control just yet.
Belying the near-extinction of short-sellers and fears of a market melt-up, options traders remain vigilant as the historically poor month of September for the S&P 500 looms. The index slipped 0.1% Tuesday, though August still gained 2.9%.
/jlne.ws/38wPf24
FTX Acquires the First U.S.-Approved Crypto Derivatives Platform
Vildana Hajric - Bloomberg
Strategy is to offer array of assets in regulated markets; Majority of global crypto volume trades through derivatives
FTX.US has agreed to acquire LedgerX for an undisclosed sum, a move that's set to expand the crypto exchange's product offerings to futures and options trading in the U.S. The majority of global crypto volume trades through derivatives, though most of that occurs on venues outside the U.S. But there's "a deep demand" from both retail traders and institutions for regulated crypto derivatives within the country, said Brett Harrison, president of FTX.US.
/jlne.ws/3Bu4EMT
The CEO of an ETF provider breaks down why his firm filed for a fund designed to track heavily shorted stocks ripe for a squeeze
Isabelle Lee - Markets Insider
As meme stocks have made a comeback this summer, an investment firm wants to launch an exchange-traded fund that tracks heavily shorted stocks ripe for a squeeze.
The High Short Interest ETF, which will trade under the ticker DUMP, aims to invest in stocks that "demonstrate high short interest" and a "potential catalyst for upside."
/jlne.ws/3kJ8oDr
Canada's Election to Foil Currency (CAD) Traders Hunting for Volatility
Brody Ford and Robert Fullem - Bloomberg
Elections often drive big swings in the foreign-exchange market, with the risk of radical change this year pushing down the Peruvian sol and the Chilean peso.
Not so for Canada.
/jlne.ws/3zAvIJK
Support.com, other new meme stocks dip, hitting pause in monster rally
Sinéad Carew, Medha Singh and Saqib Iqbal Ahmed - Reuters
A gaggle of so-called meme stocks were mostly lower on Tuesday after eye-popping rallies in their shares in recent days suggested that retail investors are still eager to bet on companies popular in online forums.
Shares of software company Support.com shot up 313% in the six trading sessions through Monday and were up more than 1,400% year-to-date. They were down 11.3% on Tuesday afternoon.
/jlne.ws/3DEKEcr
| | | | | | Exchanges | | | Abu Dhabi Securities Exchange (ADX) to Launch Derivatives Market, Leveraging Nasdaq Technology
Nasdaq
Nasdaq and ADX sign new market technology agreement; Single stock and index futures will provide investors with hedging tools; Initiative will be supported by addition of CCP clearing capability for Derivatives Contracts
Today, Abu Dhabi Securities Exchange (ADX) announced that it has taken a key step towards launching a derivatives market this year by signing an agreement with Nasdaq (Nasdaq: NDAQ) to deliver marketplace technology solutions, including matching, real-time clearing and settlement technology.
/jlne.ws/3BuJY7p
Cboe Donation Makes a Difference on Chicago's West Side
Cboe Insights
At the beginning of the coronavirus pandemic, Cboe committed $1 million to aiding first responders in the fight against COVID-19. The funding was used to manufacture 70 isolation pods, which provide for the safe transport of patients infected with COVID-19.
The pods, which are produced by Romeoville, IL-based manufacturer, ISOVAC, were distributed to several first responders and healthcare organizations in Chicago, New York and Kansas City, including Sinai Chicago, which operates Mount Sinai Hospital on the city's West side and received six isolation pods.
/bit.ly/38t5XiK
The Lasting Results of an Unprecedented Market Environment
Cboe Insights
The COVID-19 pandemic seemed to spark a major shift in trading and market structure, as people stayed home and new retail investors began trading. To determine the lasting impacts of this shift, Jeff Nguyen, Cboe Intern, analyzed displayed and non-displayed market centers between the first quarter of 2020 and the second quarter of 2021.
The COVID-19 pandemic brought forth one of the sharpest, most rapid declines and subsequent recoveries of asset prices in recent memory. Beginning on Feburary 24, 2020 the S&P 500 Index ultimately decreased 35.4% over 24 trading sessionsâa decline not seen since the 2008 Great Recession. Five months later, the index reversed its losses and reached new highs.
/bit.ly/38vZP9h
Cboe Posts a Dip in FX Volume during August 2021
The exchange reported a total FX volume of $636 billion last month.
Finance Magnates
Cboe FX Markets recently released its trading volume for August 2021 and saw a sharp decline in the numbers. According to the released data, Cboe FX Markets saw an average daily volume (ADV) of $28.9 billion in August, which is significantly lower compared to July 2021.
/bit.ly/3DCNKNP
Uncleared Margin Rules, Phase 5: the challenges and how to face them
Eurex
As one of the responses to the financial crisis of 2008 - 2009, a reform to implement margin requirements for non-centrally cleared derivatives was recommended.
In September 2013, the Basel Committee on Banking Supervision (BCBS) and the International Organisation of Securities Commissions (IOSCO) published the global framework for margin requirements for "non-centrally cleared derivatives". The requirements for the Uncleared Margin Rules (UMR) apply to OTC derivatives that are not cleared through a central counterparty.
/bit.ly/3BxCC33
| | | | | | Regulation & Enforcement | | | ISDA Responds to FCA on LIBOR Transition and the DTO
ISDA
On August 25, 2021, ISDA submitted a response to the Financial Conduct Authority's (FCA) CP21/22 on LIBOR transition and the derivatives trading obligation (DTO). Currently, the classes of derivatives that are subject to the DTO are swaps referencing US dollar LIBOR, sterling LIBOR, EURIBOR and certain credit default swaps. The FCA is modifying the DTO in light of interest rate benchmark reform and the transition from LIBOR to risk-free rates.
/jlne.ws/3yyYfhD
SEC chief Gary Gensler says cryptocurrency platforms are too big to survive without regulation Harry Robertson - Markets Insider
Securities and Exchange Commission boss Gary Gensler has said cryptocurrency platforms have become so large that they need to embrace regulation or risk losing public trust, as he hones in on the booming crypto trading sector.
/jlne.ws/3mN889c
| | | | | | Strategy | | | Beware of increased stock market volatility, Delta has slowed the economy: Goldman
Brian Sozzi - Yahoo Finance
August marked the seventh straight month of gains for the S&P 500 (^GSPC) as investors ignored softening U.S. economic data at the hands of the COVID Delta variant.
But investors may be wise to stop ignoring the data, and position for a September rife with market volatility, says the team at Goldman Sachs.
/yhoo.it/3l0TybN
FX options wrap-Watch option prices for U.S. NFP and c.bank clues
Reuters
FX options thrive on FX volatility - using implied volatility to gauge expectations - and there should be some clear signals about Friday's U.S. jobs data and next week's central bank meetings, from Thursday.
Overnight expiry options will capture the U.S. jobs, so the extent of gains in related implied volatility from Wednesday's prices, will show by how much dealers think the jobs data could increase actual FX volatility. Strong jobs data would bolster market expectations of imminent Fed Reserve tapering, and vice versa.
/bit.ly/3t6qLpx
| | | | | | Miscellaneous | | | Seasoned investors pile into the industry behind new currencies
Eva Szalay - Financial Times
Some benefits of investing in cryptocurrencies can be quite unexpected. For billionaire financier Mike Novogratz, it was the chance to give a speech about digital art at a prestigious auction house â and settle an old score.
"I was thinking: if only my third-grade art teacher could see me now," says the 56-year-old former money market trader. "She didn't think I was very good and here I am, on stage at Christie's giving a talk."
/jlne.ws/3DLnocT
Donald Trump says cryptocurrencies are a disaster waiting to happen - and slams the 'fake' money for hurting the dollar
Shalini Nagarajan - Markets Insider
Donald Trump described cryptocurrencies as a disaster waiting to happen, and lashed out at them for hurting the dollar.
"I like the currency of the United States," the former US president told Fox Business' Stuart Varney when asked his thoughts on crypto. "I think the others are potentially a disaster waiting to happen."
Trump cast doubt on digital assets, and said people in the US "should be invested in our currency."
/jlne.ws/3DyGWRD
China Hedge Funds Pay $300,000 to Beat Wall Street to Best Graduates
Bloomberg News via Yahoo Finance
When computing major Garen Zhou deferred his studies in the U.S. because of the pandemic, he applied for internships at China's biggest internet companies.
In the end, the Peking University graduate chose Ubiquant, a local hedge fund managing $8 billion of assets which is offering top college leavers like Ph.D.s annual salaries of as much as $300,000. After a year, Zhou became a permanent employee, giving up his enrollment at Johns Hopkins University.
/jlne.ws/3gOAcFi
Corrections & Amplifications
The Wall Street Journal
Nearly 80% of Robinhood Markets Inc.'s total net revenue for the second quarter came from payments it received for routing investors' orders for stocks, options and cryptocurrencies. In some editions Tuesday, a Business & Finance article about Robinhood incorrectly omitted options.
/on.wsj.com/3BxOfXL
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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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| | | Jeff Bergstrom
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