Lead Stories

Setback for International Securities Exchange in Index-Options Case
Jacob Bunge, Dow Jones Newswires (via FOX Business)
The International Securities Exchange hit a barrier Thursday in a years-long legal battle over the right to trade options contracts linked to widely followed stock indexes, after the Illinois Supreme Court declined to consider the matter.
The decision protects exclusive rights held by the Chicago Board Options Exchange to trade options on the Standard & Poor’s 500 and Dow Jones Industrial Average indexes, which represent a key profit center of the CBOE.
http://jlne.ws/Ro0A6E

VIX ETFs Show Market Complacency As Stocks Flirt With Record Highs
Tom Lydon, Seeking Alpha
Exchange traded funds that track the movement of CBOE Volatility Index futures reflect the growing complacency within the equities market as investors feel more confident in dipping back into riskier assets.
http://jlne.ws/OS4GWf

The Ambiguous VIX: A Fear Gauge Or A Contrarian Indicator
Michael Harris, Seeking Alpha
[N]ot all investors are alike and do not experience the same emotions due to market swings. We know from experience that when panic hits the market and retail selling accelerates, long-term professional investors are often on the buy side. Thus, it appears that generalizations regarding VIX as far as its relation to investor emotions may not be fully justified. After all, for every buyer there must be a seller.
http://jlne.ws/QKC2lP

TD Securities hires options trader from RBC
Miriam Siers, FX Week
Canadian bank TD Securities has appointed Ryan Brandham as vice-president and director, responsible for running the foreign exchange options trading business.
http://jlne.ws/Ro2hB4

EXCHANGE

Illinois Supreme Court Rejects Ise Appeal of CBOE’s Index Option Victory
Press Release
On September 26, 2012, the Illinois Supreme Court refused to hear International Securities Exchange’s (ISE) appeal of the Appellate Court’s May 25, 2012 decision that affirmed a permanent injunction prohibiting ISE from listing or providing an exchange market for trading in options on either the S&P 500® Index (S&P 500) or the Dow Jones Industrial Average (DJIA). This injunction also forbids The Options Clearing Corporation (OCC) from clearing options on these indexes for ISE.
http://jlne.ws/Ro0Z95

Regulation

Geithner to SEC: Get to Work, or We’ll Do It for You
Deborah Solomon, Bloomberg
Only in the bureaucratic world of Washington could Treasury Secretary Timothy Geithner’s letter today urging regulators to strengthen their oversight of money-market mutual funds be viewed as progress.
But progress it is.
Geithner has recommended the Financial Stability Oversight Council begin the process of regulating the funds in the event the Securities and Exchange Commission is “unwilling to act in a timely and effective manner.”
http://jlne.ws/Ro06gK

Exchange, Brokerage Officials to Attend SEC Roundtable
Jacob Bunge, Dow Jones Newswires (via NASDAQ)
Operations and technology officials from the biggest U.S. stock exchanges and trading firms next week will detail ways to prevent automated trading programs from running wild, according to a notice from the Securities and Exchange Commission.
Market operators NYSE Euronext (NYX), Nasdaq OMX Group Inc. (NDAQ), BATS Global Markets Inc. and Direct Edge Holdings LLC will send officials who oversee exchange functions to the daylong roundtable meeting, according to the SEC’s Friday notice.
http://jlne.ws/Ro3qsv

SEC Charges Investment Bank Analyst with Illegally Tipping College Friend About Nonpublic Merger Deals
Equities.com
The Securities & Exchange Commission issued the following news release:
The Securities and Exchange Commission today charged a former analyst at a Boston-based investment bank with illegally tipping a close friend with confidential information about clients involved in impending mergers and acquisitions…
The SEC alleges that in the days leading up to the public announcements of each of these deals, Chen made sizeable purchases of stock and call options in Candela and Somanetics and made unusual trades in the securities of each of these acquisition targets.
http://jlne.ws/QKzPqq

Technology

NASDAQ Launches Cloud Computing App
NASDAQ
On Tuesday, NASDAQ OMX Group Inc. ( NDAQ ) announced the launch of an Amazon Web Services-powered cloud computing platform – FinQloud. The platform has been created to assist the financial services industry in storing and managing financial data with a view to simplifying operations and helping companies meet regulatory requirements.
http://jlne.ws/Ro3OqW

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