| September 09, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | What Motivates Retail Options Traders?
Traders Magazine
Retail investor trading in options took off during the COVID pandemic, and in 2020, retail investors accounted for more than $250 billion of total single-name option volume. With the meme stock frenzy that same year, many pondered the impact these investors may be having across a variety of markets. And, as the markets have taken twists and turns since, others wonder if retail option traders may realize the risks associated with investing in these less traditional investments.
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'Appalling' Mood Fuels $11 Billion US Stocks Exodus, BofA Says
Farah Elbahrawy - Bloomberg
Investors are rushing out of US equities as the likelihood of an economic downturn increases amid a myriad of risks, according to Bank of America Corp. strategists.
The nation's stock funds had outflows of $10.9 billion in the week to Sept. 7, according to EPFR Global data cited by the bank. The biggest exodus in 11 weeks was led by technology stocks, which saw withdrawals of $1.8 billion. Global equity funds had outflows of $14.5 billion, while $6.1 billion was poured into government and Treasury bonds, the data show.
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Institutional traders buy 3x more put options than in 2008 amid turbulent markets
Dino Kurbegovic - Finbold
A world clouded by uncertainties exacerbated by the war in Ukraine, rising inflation, and a potential energy crisis in Europe is causing a lot of anxiety to market participants.
In this line, a striking chart depicting macro data was shared by the SentimentTrader official Twitter account on September 7, which shows the extreme hedging volume undertaken by institutional investors. The data is pointing to a possible massive reversal in the markets.
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Say Goodbye to the Era of Low Volatility
Stephen Miran - Barron's
Despite the market fireworks, the most important speech at last month's Jackson Hole conference wasn't given by Federal Reserve Chairman Jerome Powell. It was delivered by Agustin Carstens, head of the Bank for International Settlements and former governor of the Bank of Mexico. Carstens is a significant global policy maker, but it was his message that mattered most. Recent economic volatility is not a fluke, he argued. Changing global megatrends will reshape the entirety of the global economy, forcing a serious rethink of economic policy.
These forces have significant implications for asset markets, and investors should take notice.
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How low can the stock market go? 4 bear scenarios investors should keep in mind
Isabel Wang - MarketWatch
Bears who reckon the S&P 500 hasn't yet found its bottom see the large-cap benchmark falling 15% to 35% from current levels, according to DataTrek Research co-founder Nicholas Colas.
With that in mind, the Wall Street veteran, in a Thursday note, outlined four downside scenarios that investors should consider:
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| | | | | | Exchanges | | | GlobalCapital Names OCC Americas Derivatives Clearing House of the Year
OCC
OCC, the world's largest equity derivatives clearing organization, has been honored as the Americas Derivatives Clearing House of the Year in 2022 by GlobalCapital.
OCC's Chief Executive Officer John P. Davidson accepted the award on behalf of the organization during a formal ceremony in New York on Thursday, September 8. "Building on the momentum of the past few years, this award demonstrates that OCC has risen to meet the challenges stemming from the evolution and growth of the U.S. listed options industry, even as we work diligently to deliver our new clearing platform, Ovation, to the markets," he said. "We are proud of this recognition and are committed to the ongoing improvement of our operations, services and offerings to ensure we continue to meet the needs of all market participants, and to serve as the foundation for secure markets."
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Cboe and NEO Dual Launch New Suite of Women-Led Sustainable ETFs in the U.S. and Canada
Cboe Global Markets, Inc.
Cboe Global Markets, Inc. (Cboe: CBOE), a leading provider of global market infrastructure and tradable products, today announced that two of its exchanges have listed a new suite of sustainable ETFs from Emerge. The investment strategies are available in both U.S.- and Canada-domiciled funds, marking Cboe's first coordinated launch of ETFs on both sides of the border. The suite of Emerge EMPWR ETFs begins trading simultaneously on two of Cboe's stock exchanges - Cboe BZX Exchange in the U.S., and the NEO Exchange in Canada - under the following respective U.S. and Canadian symbols. The U.S. funds are managed by Emerge Capital Management Inc., and the Canadian funds are managed by Emerge Canada Inc.
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Emerge to Launch 10 Sustainable ETFs That Are All Run by Women; 'They're just wicked smart and they work so hard': Langley; Five different ESG strategies offered in both US and Canada
Peyton Forte - Bloomberg
Even as flows into environmental, social and governance ETFs are slowing, Emerge is introducing its first set of active sustainable ETFs with a twist -- each fund will be overseen by women. On Sept. 8, the investment management firm will launch five different ESG exchange-traded funds, with versions listed on both the Cboe BZX Exchange in the US and the NEO Exchange in Canada. The funds will invest in equity securities that exclude certain categories, according to prospectus documents, such as gambling, adult entertainment and chemical weapons.
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| | | | | | Strategy | | | Market Volatility Spells Opportunity for Options-Savvy Investors
Steven M. Sears - Barron's
Once again, the stock market is confronting a dramatic shift.
The illusion that inflation was peaking, and that the Federal Reserve wouldn't raise interest rates so aggressively, was recently demolishedâand this means stock valuations are aggressively open to bearish interpretations.
Jerome Powell, the central bank's chairman, bluntly said at the Fed's summer retreat in Jackson Hole, Wyo., that ridding the economy of inflation will be painful. Ever since, the stock market has behaved like a dog afraid of its master. Its fear gauge, the Cboe Volatility Index, or VIX, has advanced in anticipation of another beating.
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How to Invest in Stocks With Volatility High As the Fed Hikes: UBS
James Faris - BusinessInsider
UBS may be slightly bearish on stocks heading into year-end, but its market outlook from there onward is hardly all doom and gloom.
The firm's year-end S&P 500 target of 3,900 implies about 3% downside, and its June 2023 target of 4,200 suggests an 8% increase for stocks from year-end levels. And unlike some of its peers, UBS isn't calling for a 2022 recession.
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Bullish traders may love this remarkable contrarian signal
Jamie Chisholm - MarketWatch
Early futures action on Friday suggested Wall Street might be able to make it three positive days in a row.
Chastened investors will be wary, however. It hasn't benefited either bulls or bears of late to assume a march in either direction can be maintained for long without containing sharp reversals.
For example, within the last six months the S&P 500 has seen a 16% drop, then a 7% rally, followed by a 12% slide, a 17% surge and a 9% decline.
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| | | | | | Miscellaneous | | | Wall Street's Commodity Traders on Track to Break Profit Records
William Shaw and Jack Farchy - Bloomberg
The world's biggest banks are on track to make a killing in commodities this year, surpassing the record sums they made in the financial crisis.
The 100 biggest banks by revenue are set to make $18 billion from commodities trading in 2022, according to data and estimates from Vali Analytics in London. That would be the highest in the data, which goes back 14 years, and exceed the previous high watermark in 2009.
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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
Editor
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