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Category Archives: Options

Options news updates from John Lothian News.

One hundred days of Donald Trump have left investors sanguine; Vix ‘fear gauge’ closes at 3-year low; Brexit Overshadows Election Boost for Pound as Funds Skeptical Standard

Observations & Insight D is for Data Jim Kharouf, John Lothian and Spencer Doar – JLN The sold-out FinTech Exchange conference, hosted by Barchart, was largely about data – what to do with data, how exchanges are capturing new data and how to trade it. That, on its surface, isn’t particularly new. But the infrastructure to capture all kinds of data is now developed. The CME Group’s Julie Armstrong Menacho colorfully outlined how the exchange has migrated all of its historical data onto the cloud, giving customers greater access to it, along with a growing list of partners who provide…

The market’s risky bet on stability; Bets on a stock market rally using options just hit record levels; Euro Is Suddenly Everyone’s Favorite After First Round of French Election Standard

Observations & Insight Did you know? Jim Kharouf and Spencer Doar – JLN Moscow, OneChicago, MexDer, Fear Gauge and Trump Street with an Irish twist. No, they are not connected. One of the interesting things about updating annual volume figures on our MarketsWiki site is the snapshot of how a particular exchange has been doing over a number of years. The FIA Annual Volume Survey shows a couple of unusual suspects in the top 5 in 2016 with the National Stock Exchange of India coming in second and the Moscow Exchange at number four in terms of derivatives volumes. At…

Virtu and Citadel Securities go head to head in HFT; Multi-asset services key for buy-side execution; Why do asset prices move? Standard

Observations & Insight Things I Learned About Finance Bros by (Briefly) Dating a Finance Bro Tara Isabella Burton – The New Yorker It’s not that they’re actually ever mad at the valet. They just want him to learn. /goo.gl/d7Tmpa ****SD: Good for your daily dose of laughs (and some cringes). “They will take you to very trendy experimental-cocktail bars that they read about on Gothamist. They will encourage you to try something with twenty ingredients. They will order an Old Fashioned. Every. Single. Time.” Lead Stories Virtu and Citadel Securities go head to head in HFT Philip Stafford and Nicole…

Implementation of SA-CCR Important For Liquid and Orderly Listed Options Markets; Seventeen years after 5,000, Nasdaq tops 6,000; What Markets Should Conclude From France’s Election Standard

Observations & Insight Other VIXes Spencer Doar – JLN Of all the CBOE’s products, none gets media attention like the VIX. But CBOE has plenty of other VIX products, ranging from the BPVIX (CBOE/CME FX British Pound Volatility Index) to the GVZ (CBOE Gold ETF Volatility Index). The VIX plummeted yesterday to the 10 handle after the results of the first round of the French election were interpreted as positive (VIX is around 10.6 as of this writing). The media will sometimes give markets the gloss over treatment, look at the VIX and only the VIX, and declare “where’s the…

Anxiety Dissipates After First Ballot; Expectations for euro-dollar, US stock volatility plummet; The Downside of Managing Downside Risk Standard

Observations & Insight Last week’s notables A lot happened last week in the options space. If anybody didn’t follow the week’s developments, here’s a little recap. Big trends are continuing in the market making world. I wouldn’t say they are good. First, Interactive Brokers revealed in its earnings that the firm’s market making operations lost $22 million in Q1. (Remember that the company revealed a bit ago that they were shuttering their options market making operations — some of this loss is restructuring costs.) Second, the KCG/Virtu deal was agreed upon for $1.4 billion. It’s getting hard out there and…

US Options Volume Gains Momentum in Q1 2017; Borussia Dortmund Bus Attacker Hoped to Profit From Share Slump; Options market signals the need for Europe to change Standard

Observations & Insight UChicago Midwest Trading Competition: The Next Generation Gets a Taste JohnLothianNews.com On April 8, the University of Chicago hosted its fifth iteration of the Midwest Trading Competition, drawing 102 students from some of the most prestigious colleges and universities across the United States and Canada. The students got a chance to test their algorithms using Trading Technologies’ TT Platform in a variety of simulations involving pairs trading and options market-making. But the event was more than just a fun way for smart kids to strut their stuff using real-world technology and market data. It was a rare…

Trading firm Virtu Financial to buy KCG for about $1.4 billion; Mystery trader ’50 Cent’ can’t stop betting on a stock market shock; Euro, currency volatility jump ahead of French election first round Standard

Observations & Insight World Federation of Exchanges publishes Annual IOMA Derivatives Report WFE The World Federation of Exchanges (“WFE”), which represents more than 200 market infrastructure providers including exchanges and CCPs, has today published its annual report into the global derivatives market. Highlights of the report are as follows: 1) Derivatives volumes continued to grow in 2016 – increasing by 2.2% on 2015 – reaching a total number of 24.9 billion derivatives contracts. 2) This was made up of 9.4 billion options (38%) and 15.5 billion futures (62%) traded. /goo.gl/XGB4dP Lead Stories Trading firm Virtu Financial to buy KCG for…

Interactive Brokers suffers $22m market making loss; Former Harvard Money Whiz Jack Meyer Tries to Regain His Edge; Dash Financial Technologies Names Ari House Chief Financial Officer Standard

Lead Stories Interactive Brokers suffers $22m market making loss Hayley McDowell – The Trade The market making business at Interactive Brokers made a $22 million loss in the first quarter this year, as the firm moves forward with winding down its options market making services. Interactive Brokers explained the rate of continuing losses within market making had been ‘substantially reduced’ by the decision to shutdown options market making. jlne.ws/2oVW2wF ****SD: In case anyone thinks this was a sudden phenomenon, and in lieu of a graph of declining profits, I’ll point readers to an AmsterdamTrader post from 2010 titled “Timber Hill…

The fearless market ignores perils ahead; In rare fumble, Goldman stuns Wall Street with weak trading; Fischer Expects Muted Market Response When Fed Trims Balance Sheet Standard

Lead Stories The fearless market ignores perils ahead Robin Wigglesworth – Financial Times In 1992, a Bob Dylan-loving finance professor called Robert Whaley uprooted his family from the US and moved to a tiny hamlet in bucolic Burgundy. There he spent six months laying the groundwork for the finance industry’s most popular representation of terror. jlne.ws/2pPdWyi In rare fumble, Goldman stuns Wall Street with weak trading Reuters Goldman Sachs Group Inc (GS.N) fell short of earnings expectations on Tuesday due to a drop in quarterly trading revenue, prompting analysts to demand explanations for underperformance in an area where the bank…