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Category Archives: Options

Options news updates from John Lothian News.

JLN Options: Options Market Makers Flock to ISE Standard

Lead Stories Options Market Makers Flock to ISEPeter Chapman, Traders Magazine Online News, March 27, 2012The International Securities Exchange, in a bid to reverse an ongoing decline in its market share, is expanding the ranks of its market makers.In the past seven months, ISE has signed up five new market makers and expects to add “a couple more,” according to exchange executives. From 20 market makers in July 2011, ISE now boasts 25. Behind the jump is a change in the way ISE allocates options to its second-tier market makers, known as Competitive Market Makers. Last September, ISE began allowing…

JLN Options: CBOE and S&P Indices Take Action to Enforce Injunction Against ISE Regarding S&P 500 Index Options Standard

COMMENTARY To Err is TechnicalBy Jim Kharouf for the John Lothian Newsletter On Sunday night, BATS’ CEO Joe Ratterman sent a letter to customers apologizing for the company’s failed IPO on Friday. The embarrassing moment occurred after a technical problem prevented the proper pricing of BATS stock as it rolled from its IPO to regular trading. BATS ultimately scuttled the IPO after trying to resolve the problem and now is trying to pick up the pieces from there. (You can read the full letter below.) As Ratterman put it, “we were under the brightest spotlight imaginable … opening our own…

JLN Options: BATS IPO Halted After Erroneous Trades Hit Apple, Others Standard

Lead Stories BATS IPO Halted After Erroneous Trades Hit Apple, Others By LYNN COWAN, STEVEN RUSSOLILLO and DAVID BENOIT, WSJ.comBATS Global Markets Inc.’s BATS -99.75% IPO was halted after erroneous trades on Nasdaq, and technical snafus on its own exchange affecting the stock of Apple Inc. AAPL -0.34% and others. BATS, which priced Thursday night and debuted this morning, was halted by Nasdaq for “clearly erroneous” trades after it opened. BATS Global Markets said it wanted to try its IPO again in the afternoon, but has canceled the plan. The exchange operator’s website now says it will be “further delaying…

JLN Options: VIX Futures’ Record-Setting Surge Standard

LEAD STORIES VIX Futures’ Record-Setting SurgeBetting increases in VIX futures, but index seems unlikely to make a big moveBy Tyler Craig, InvestorPlaceThe CBOE Futures Exchange (CFE) recently announced the open interest in VIX futures reached a new all-time high at 282,314 contracts. The besting of the previous record set a short four days earlier on March 1 is yet one more sign of the investing crowd’s growing interest in the CBOE Volatility Index (CBOE:VIX) and its related trading products.While it is easy to conclude the uptick in activity reveals a rise in popularity, it is difficult to determine what implications,…

JLN Options: Report: Is a VIX of VIX Too Many Derivatives? Standard

Is a VIX of VIX Too Many Derivatives?By Sarah Rudolph Last week at the FIA conference in Boca Raton, the Chicago Board Options Exchange announced a new CBOE VIX of VIX Index (VVIX) that measures the volatility of the CBOE Volatility Index (the VIX index). The VIX index itself is a measure of the market’s expectation of future volatility implied by the prices of options on the S&P 500 stock index. Who are the likely users of the index? Anyone who trades volatility products or watches the VIX index, according to Catherine Shalen, director, research and product development, for CBOE….

JLN Options: CBOE builds out compliance staff as second exec leaves Standard

Lead Stories CBOE builds out compliance staff as second exec leaves Crain’s Chicago Business By Lynne Marek March 21, 2012CBOE Holdings Inc. is beefing up its compliance and regulatory staff as a Securities and Exchange Commission investigation bears down on the Chicago options exchange company. Since the start of the year, CBOE has posted job listings on its website seeking a chief compliance officer, a deputy chief regulatory officer and a chief examiner plus two other examiners, all of whom have compliance responsibilities. In the prior five months, it only sought two lower-level examiners. A spokeswoman declined to comment on…

JLN Options: CBOE Market-Regulation Head Departs During SEC Inquiry Standard

Lead Stories CBOE Market-Regulation Head Departs During SEC InquiryBy Jacob Bunge Of DOW JONES NEWSWIRES CHICAGO (Dow Jones)–The head of the Chicago Board Options Exchange’s market-regulation department has left the company, the second compliance official to depart the CBOE during a regulatory investigation into its market-oversight functions. Linda Gerdes was dismissed this month from her post at the CBOE after five years leading its market-regulation department and about 23 years at the exchange. Previously, she designed technology systems to help the CBOE catch manipulative trading activities and worked with Securities & Exchange Commission officials on market surveillance. Monday, Gerdes confirmed…

JLN Options: VIX Bets at Record as Volatility Sinks to Five-Year Low Standard

Lead Stories VIX Bets at Record as Volatility Sinks to Five-Year Low Bloomberg By Nikolaj Gammeltoft, Cecile Vannucci and Matt Robinson – Mar 19, 2012 Investors are piling into securities that protect against losses in equities at the fastest rate ever after the Standard & Poor’s 500 Index climbed to the highest level in almost four years. Demand to hedge gains pushed up the number of shares available for trading to records last week in four of the five largest exchange-traded funds and notes that track U.S. stock volatility, data compiled by Bloomberg show. For the iPath S&P 500 VIX…

JLN Options: Third Steepest First-Second Month VIX Futures Contango Ever (TVIX, VXX, VXZ, ZIV, XIV) Standard

Lead Stories Third Steepest First-Second Month VIX Futures Contango Ever (TVIX, VXX, VXZ, ZIV, XIV)By Bill Luby, ETF Daily NewsFor a variety of reasons, investors seem unwilling to embrace the current rally and with each day the market rises, I see a scramble in the indicator forest to find some sort of proof that stocks are finally, inevitably going to correct…and soon. I need to give this phenomenon a name, so I am going to call it indicator hunting and define it as a companion to confirmation bias…One of the current targets of indicator hunting is the huge contango in…