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U.S. investors brace for mounting political risks as they decode Trump; Volatility Traders Shed VIX Positions as Markets Are Eerily Calm; The Volatility Limbo Newsletter,Options

Lead Stories U.S. investors brace for mounting political risks as they decode Trump David Randall and Jennifer Ablan – Reuters Barry James built up his $4 billion mutual fund largely by studying balance sheets, earnings and market share. In the last few weeks, however, he has realized that he must look at a new force in the market: U.S. President Donald Trump. /goo.gl/iGS2KU ****SD: Out of everybody, I bet Nick Cage and Tom Hanks could figure out how to decipher the code of Trump. Volatility Traders Shed VIX Positions as Markets Are Eerily Calm Carolina Wilson – Bloomberg Assets in…

Michael Kraines Named Chief Financial Officer of Trading Technologies ; Euronext targets family businesses with new initiatives; ‘Brexit’ Talks Can’t Start Without Parliament, U.K. Supreme Court Rules John Lothian Newsletter,Newsletter

First Read Michael Kraines Brings 25 Years of Strategy Experience as Trading Technologies’ New CFO Sarah Rudolph, JLN It’s time for some strategic thinking. Trading Technologies has announced the hiring of its first ever chief financial officer, Michael Kraines. Kraines has been in the fintech business for more than 25 years. Though he knows technology, his background is “really very externally facing,” he said in an interview with JLN. His forte is putting people and companies together, and he hopes to add more partnerships, joint ventures and alliances to TT. “I am a strategy guy and have a background looking…

NYSE to expand floor trading as part of integrated dealing system; U.K. Bankers Drop Push to Keep EU ‘Passporting’ After Brexit; When Bad Things Happen to Good Funds John Lothian Newsletter,Newsletter

First Read Bits & Pieces By JLN Staff Brookly McLaughlin has rejoined Intercontinental Exchange as senior director, marketing and public affairs, giving ICE more political punch. She returns after a little more than a year at Magnetar Capital. McLaughlin originally came to ICE in the CCX deal. She was the communications director for the Chicago Climate Exchange before it was acquired by ICE. She also previously worked for the U.S. Treasury Department under Hank Paulson. Jeff Sprecher, Richard Sandor and Hank Paulson are some pretty good bosses to have. The Security Traders Association of Chicago is in day two of…

China’s Markets Are Tamed—but Not Tempting; Chinese hackers charged with theft from Wall Street law firms John Lothian Newsletter,Newsletter

First Read Multiple Buyers, Not One, Influenced Most Active E-Mini Move of 2016 Alexander Osipovich – WSJ A sharp move in stock-market futures that fueled the Dec. 7 buying in U.S. equities likely reflected trading by multiple buyers, said a market-data firm that shared its analysis with The Wall Street Journal, a shift from its prior conclusion—published by the Journal—that a single buyer was behind the move. The firm, MayStreet LLC, said its initial analysis, which characterized the event as a single $1.8 billion trade with one unknown buyer behind it, was based on a misunderstanding of how CME Group…

How the Biggest E-Mini Futures Trade of 2016 Sent the Market Soaring; Calypso Technology to Hire Aggressively in 2017, Following a Record Year in 2016; Good Lessons From One Bad Deal That Destroyed Four Bad Banks John Lothian Newsletter,Newsletter

First Read Bits and Pieces By JLN Staff Tis the season for people moves. Kevin Wolf, formerly chief business and product development officer at Eris Exchange, has moved on to ViableMkts, a firm that focuses on market structure and fintech advisory services. As a principal at the firm, he will bring his interest rate market knowledge to the team. Interestingly, ViableMkts is led by Chris White, who provided one of the more entertaining and participatory talks at our MarketsWiki Education event last year. Wolf spoke at our MarketsWiki Education event in New York this year. Meanwhile, another MarketsWiki Education speaker,…

Market Calm Back as Short-Term Volatility Falls Most Ever; OCC News; Post-Trump About-Face Triggers 2 Rare S&P Signals Newsletter,Options

Observations & Insight 2016 Could Be The Year Of The CEO By Jim Kharouf, JLN Editor-in-Chief Forget the Chinese New Year plunge, Brexit, The Donald or even the Cubs. This is also shaping up as the year of the new CEO, with exchanges and clearinghouses especially, in moves that could reshape our markets in the coming years. The two biggest CEO changes came within days of each other, with Terry Duffy taking the reins as CEO at CME Group from Phupinder Gill and Adena Friedman at Nasdaq, taking over from longtime CEO Robert Greifeld at the start of 2017. They…

Ding-dong the VIX is dead (but risk is rising); Europe is ‘unlikely’ to seize euro-based clearing from London, says S&P; Yellen Signals Fed Remains Likely to Raise Rates Next Month Newsletter,Options

Lead Stories Ding-dong the VIX is dead (but risk is rising) James Saft – Reuters The VIX, the so-called fear gauge, is dead but the real risk-appetite index is falling. The dollar is the new and true North Star of global markets, according to a study released on Tuesday by the Bank for International Settlements, with a rising dollar coinciding with falling risk tolerance. This just in time for the Trump era, widely expected to bring with it rising inflation and interest rates driving a rising dollar. /goo.gl/UckqBt ****SD: Maybe people always inferred too much from the VIX? Whatever the…

Derivatives traders forced to provide $27bn collateral post-Brexit; CFTC – ‘too-big-to-fail’ clearinghouses resilient to shocks; House Foe of Dodd-Frank Says Overhaul Will Face Test in Senate John Lothian Newsletter,Newsletter

First Read Step Right Up By John J. Lothian Last Thursday I had the honor of co-chairing the LaSalle Trading Tech Awards for the Pathway to Adventure Council of Boy Scouts of America with XR Trading President Matt Haraburda. This year’s program was different. We did not have a “Committee” for the event, but a “Task Force.” Our task includes not just the event, but to put on three weeks of merit badge workshops this summer in Chicago. We want to hold five straight days in June, July and August of STEM focused merit badge workshops in the offices of…

Sailing the Chaos of a Trump Rally; Why A Trump Presidency is Fed Positive; Stock market struggles to extend last week’s postelection rally Newsletter,Options

Observations & Insight A Basel netting issue: Pushing for less burdensome capital requirements in the options market Spencer Doar – JLN The unintended consequences of financial regulation have been seeping into the markets since the first rule was made in the wake of the financial crisis. One prime example is the leverage ratio, which determines the required capital of general clearing members. The actual calculation of the capital requirement within the Basel III leverage ratio framework is a particular sticking point for the OCC. Right now, the Current Exposure Method (CEM) is used in the calculation, whereas the OCC and…