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Tag Archives: SPX

What’s the Deal With the VIX Manipulation Letter? Inaccuracy and Misunderstanding Blog,Feature

The big options news of the day pertains to a letter alleging VIX manipulation. The letter, written on behalf of an anonymous whistleblower by a Washington D.C. law firm, alleges market makers manipulate the VIX by quoting far out of the money SPX put options so they are included in the VIX calculation at junctures that benefit their trading activities. It’s understandable financial instruments are subject to concerns about manipulation when their inner workings are complicated and not fully understood by the general public. VIX manipulation has come up before and it will probably come up again unless regulators step…

Options Market Structure Issues; Timely VIX Hedging; No SPY Alternative for Traders Newsletter,Options

Observations & Insight Turn Yourself In, It’ll Be Easier: Bank Cooperation On Spoofing Charges Saves Millions Jim Kharouf – JLN Over the past several months, there has been a fair amount of talk about the Commodity Futures Trading Commission’s push on the so-called “self-reporting” initiative launched last September and aimed at taking it easier on firms that come forward with wrongdoing. Yesterday’s announced spoofing charges and fines include one of the first such self-reporting cases, with HSBC Securities settling for $1.6 million, Deutsche Bank for $30 million and UBS for $15 million. For the rest of the commentary, click HERE…

An Options Contract That’s Not for the Faint of Heart; Why A Resilient Risk Management and Internal Control Infrastructure Matters; “Election Certainty” Not Showing Up In SPX Options Market Newsletter,Options

Observations & Insight Last Chance to Sign Up For London MarketsWiki Education World of Opportunity Event By John J. Lothian On Friday the registration for the MarketsWiki Education World of Opportunity event in London will close. You can still sign up your interns, newer employees or anyone interested here. The event is FREE and not to be missed. We have a great line-up of speakers, though we have a couple of changes to announce. Paul Christensen and Jeremy Grant had to step aside as conflicts came up. The FT’s Phillip Stafford has agreed to step in for Mr. Grant. We…

Double Miles?: CBOE’s Frequent Trader Program Looks to Reward Traders and Provide a Window into Traders’ Worlds Blog,Commentary,Options

So how many miles you got? For frequent fliers, piling up miles trip after a trip has its payoff. CBOE adopted just that approach for its end-user community, a group which has been somewhat of a mystery to the exchange. Last month, CBOE launched its Frequent Trader program, which gives rebates to traders who reach certain monthly trading thresholds. The program is designed to do two things – encourage individual traders to trade more of the CBOE’s exclusive products, SPX options and VIX options, and give CBOE a view of just who is trading them. The voluntary program establishes an…

Livin’ The High Life: CBOE posts solid 2014, looks to global growth in 2015 Financials,Options

The Chicago Board Options Exchange held its annual Chicago press lunch yesterday. Among the highlights of the company’s success in the past year were these: 2014 volume was up 11 percent, to 1.3 billion contracts, outpacing the industry average of 4 percent. VIX options’ ADV was 632,000 contracts, while VIX futures ADV was 201,000. Its SPX Weeklys continued to show great growth, up 38 percent with an ADV of 272,277. CBOE’s shareholder return in 2014 was 25 percent, and the stock hit an all time high of $68 last Thursday. CBOE had total market share of 28.6% compared to 27.5%…

JLN Options: Options Week in Review March 14, 2013 Newsletter,Options

The latest trial in the long-running patent infringement case pitting the Chicago Board Options Exchange (CBOE) against the International Securities Exchange (ISE) ended on its opening day Thursday, in what appeared to be a victory – for now – for the CBOE. The ISE had accused CBOE of infringing an automated-trading patent, but the trial was canceled after the judge barred ISE from presenting evidence of pre-suit damages to the jury because ISE had failed to comply with a federal “marking statute,” requiring it to make its patent claim public, according to a Bloomberg story. The fight over the patent…

JLN Options: Corzine avoids lifetime futures ban, for now -regulator Newsletter,Options

Lead Stories Corzine avoids lifetime futures ban, for now -regulatorTom Polansek, ReutersA key U.S futures-market regulator said on Thursday it will block Jon Corzine, the former chief executive of failed broker MF Global, from the industry unless he clears an investigation into his fitness as a participant.http://jlne.ws/YI2kJl **Nothing to see here.  Move along. –JB Hybrid Structured Note Sales Rise as Volatility Falls to LowKevin Dugan, BloombergU.S. banks sold $271.9 million of structured notes that are tied to multiple types of assets in February, the most in almost two years, as volatility fell to its lowest level since 2007.http://jlne.ws/YIbi9y SPX Weeklys –…

JLN Options: Investors sue to block Heinz takeover Newsletter,Options

SPX vs. VIX Trailing 30 Days(click for larger image) Chart and data provided by Livevol New Restoring Customer Confidence VideoThe final scheduled video in our Restoring Customer Confidence series deals with electronic confirmations of customer funds. As the industry continues to deal with these issues, John Lothian News may highlight new ideas or developments in future Restoring Customer Confidence videos. Restoring Customer Confidence More ideas» Confirmations: Plugging Into Electronic Confirmations MarketsWiki.tv Capital Confirmation, which runs Confirmation.com, is credited with helping to unveil the massive $215 million fraud at Peregrine Financial Group (PFG) in July 2012. The web-based audit confirmation service…

JLN Options: CME’s Daily Trading Volume for Treasury Options Hit Record Friday Newsletter,Options

Lead Stories CME’s Daily Trading Volume for Treasury Options Hit Record FridayDow Jones Business News (via NASDAQ)Total daily volume edged up 0.1% to 1,174,227, compared with 1,172,710 reached on June 8, 2007. This included a record 639,306 Treasury options executed on CME Globex.http://jlne.ws/Wsv1tX Are SPX Options Too Cheap?MinyanvilleOne of the first themes of options trading that I learned on the trading desk was that the best predictor of future volatility is recent realized volatility, with all else being equal. Best predictor does not mean good predictor. It simply means that, of all the alternatives, recent realized volatility is the best…