CME Bitcoin Options Flatline After Record Growth in June; Hedge funds stick to the sidelines on oil

Jul 21, 2020

Lead Stories

CME Bitcoin Options Flatline After Record Growth in June
Zack Voell – Coindesk
Bitcoin options trading on CME has flatlined after the exchange experienced massive growth and a record-breaking expiry last month. CME’s bitcoin options open interest has grown barely 10% in July to $167 million at last check. Less than 0.2% of Friday’s aggregate bitcoin options trading occurred on CME, according to Skew. Open interest on Deribit, which represented 93% of Friday’s bitcoin options trading volume, has grown roughly 30% in July to $1.1 billion, down from $1.3 billion before the June expiry.

*****MR: Keep in mind that the author is talking about open interest here, not volume – “flatlining” is a tad dramatic, if you ask me. If you’re interested in the CME’s bitcoin options or bitcoin derivatives in general, this story is still worth reading.

Hedge funds stick to the sidelines on oil
John Kemp – Reuters
Hedge fund position-taking in crude and products remains desultory as uncertainty about the future direction of prices and the course of the coronavirus pandemic compounds the normal summer-time trading slowdown. Hedge funds and other money managers purchased the equivalent of 24 million barrels of futures and options in the six most important oil futures and options contracts in the week ending on July 14.

A Few Wall Street Traders Stayed When Everyone Fled the Office
Elena Popina – Bloomberg
He rides the elevator alone. Sits at the desk alone. Eats lunch alone. But mostly Michael Beth works nearly alone inside a glass high-rise on the Hudson River.
Since the coronavirus hit, Beth never really stopped coming to work at WallachBeth Capital, even as most office workers across America holed up at home for the pandemic.

Arkansas Pension Sues Allianz Over More Than $700 Million Loss
Justin Baer – WSJ
An Arkansas public pension plan sued Allianz Global Investors and its corporate parent late Monday, alleging the money manager violated its fiduciary duties and abandoned risk controls when it sought to reverse February losses by doubling down on a series of money-losing trades. Those trades, the Arkansas Teacher Retirement System wrote in its suit, left Allianz’s Structured Alpha funds “dangerously exposed to even the slightest increase in market volatility or decline in equity prices—the very conditions that Allianz economists, and many others, warned were on the immediate horizon.”

Exchanges and Clearing

Borsa Istanbul: Removal Of Zero From The Index Go Live Date
All preparations and the member rehearsals regarding the Removal of Two Zeros from BIST Equity Indexes have been completed. In this context, the BISTECH trading system update, which includes the changes regarding the trading principles of Derivatives Market futures and options contracts, will go-live on July 27, 2020 as planned. Please click for the related Announcement.

Nasdaq Momentum Is Hottest in 20 Years With Amazon Leading Surge
Jeran Wittenstein and Sarah Ponczek – Bloomberg
The stay-at-home trade roared back on Monday after a rough week, sending the Nasdaq 100 to its best gain in three months and pushing one measure of momentum to the highest in two decades.
The Nasdaq 100 rose almost 3% Monday, its best day versus the S&P 500 since mid-April. Meanwhile, the average S&P 500 stock dropped 0.5%. Gains in popular technology and Fang stocks lifted the benchmarks — the Nasdaq is now up 25% in 2020 and the S&P 500 is positive for the year.

*****MR: For additional reading, here is a Reuters story on the same subject.

HKEX reclaims crown of world’s most valuable exchange group
Hudson Lockett – Financial Times
Shares in Hong Kong Exchanges & Clearing notched their sharpest daily rise in five years on Tuesday, making it the world’s most valuable bourse, after Alibaba’s payments arm announced plans to sell shares in the city.
HKEX’s stock finished 9.8 per cent higher and was the best-performing member of the city’s benchmark Hang Seng index, which closed up 2.3 per cent.

MIAX Options Exchange – SPIKES Special Settlement Auction Settlement Reference Price Opening Width and Valid and Priority Quote Width Tables used in the July 22, 2020 SPIKES Special Settlement Auction
MIAX Options
Due to sustained market volatility, MIAX Options will continue to use the Settlement Reference Price Opening Width and Valid and Priority Quote Width tables detailed in MIAX Regulatory Circular 2020-11 for opening the SPY August 21, 2020 options used in the July 22, 2020 SPIKES Special Settlement Auction.


Senior Gemini exec set to leave the crypto exchange firm at the end of the week
Frank Chaparro – The Block
Jeanine Hightower-Sellitto, a former executive from the options trading world, is leaving her post at crypto exchange startup Gemini at the end of this week after nearly two years with the New York-based firm. As a managing director, Hightower-Sellitto was among the most senior employees at the exchange, responsible for covering its institutional business lines, including custody. Hightower-Sellitto reported directly to Gemini’s co-founders Cameron and Tyler Winklevoss. She joined the firm in September 2018.


How to invest in election volatility, 15 options trades: Goldman Sachs
Marley Jay – Business Insider
Deep dives on how to play the presidential election are piling up on Wall Street, but Goldman Sachs is warning investors that there are a lot of other votes worth paying attention to.
Equity Derivatives Associate Vishal Vivek says there could be a lot of volatility around state-level initiatives and regulations, and they could have big effects on how some major US companies do business in the years ahead.


2020 US election: the impact on derivatives markets
MEMBERS ONLY virtual forum featuring political analyst Charlie Cook
29 July 2020 • 10:00 AM – 12:00 PM ET • Virtual Forum
FIA is proud to host an exclusive forum featuring Charlie Cook, editor and publisher of The Cook Political Report – an independent, non-partisan newsletter that analyzes American political trends. Cook will preview the 2020 US election season and how it may shape the political landscape in the coming years. Following his virtual presentation, FIA president and CEO Walt Lukken will host a panel of Washington insiders to discuss the practical implications of the election season on our markets. Each session will include a Q&A at the end.


Chicago Fed’s national economic index hits another record high in June
Greg Robb – MarketWatch
The numbers:The Chicago Fed’s national activity index rose to a record high of 4.11 in June from the prior record of 3.5 hit in the prior month. The index has been extremely volatile – falling to a record-low negative 17.89 in April. The index’s three-month moving average, which tries to smooth this volatility, moved up to negative 3.49 in June from a negative 6.36 in the prior month.

The Ripple Effect: Technology, Operations and ESG
RFA Insights – TABB Forum
ESG has become a powerful marketing message. Could there soon to be a link between ESG and operations, extending to include the technology suppliers that investment management firms rely on? ESG has become a powerful marketing message that reflects the mood of many more investors who are interested in how their funds are invested, not just their performance. The phenomenon is cross-generational and applies equally to private and institutional investors. ESG not only manifests the public interest in climate change, environmental impact, social and corporate governance, but is also considered a useful set of measures in assessing the sustainability of a company in a rapidly changing world.

(Podcast) Option Block 919: We Are Legend
Option Block – Options Insider Network

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Past Options Newsletters

The Spread – July 30, 2021

The Spread – July 30, 2021

Earnings season in full bloom; Options lead year-to-date derivatives volume; Robinhood’s IPO; John gets real with Get Real VR: Conflicting factors underpin volatility; Cboe cleared for fall European competition; and the Cboe Options Institute’s Kevin Davitt talks about vega in this week’s “Term of the Week.”

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