Day-Trader Heaven Arrives as Tesla, Bitcoin, Stock Options Surge

Jan 8, 2021

Observations & Insight

Bloomberg’s Sarah Ponczek reported on Twitter that “when the U.S. capitol was being attacked, more than 29 million call options traded — the fourth most in history.”

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Bill Brodsky – The Path to Electronic Trading, Part 2
JohnLothianNews.com

Former Cboe Global Markets Chairman and CEO Bill Brodsky’s career in the financial industry spanned multiple decades and took him on a path from Wall Street to LaSalle Street. In a wide-ranging, two-part interview, he gave JLN an eyewitness view of the evolution of the options business, the exchanges and trading technology. Here is Part 2.

Watch the video »

Lead Stories

Day-Trader Heaven Arrives as Tesla, Bitcoin, Stock Options Surge
Claire Ballentine and Sarah Ponczek – Bloomberg
It was another day of euphoria for Bitcoin boosters and the options-slinger set as virtually all their favorite things launched skyward.
Just a day after violence rattled the U.S. Capitol and sent shockwaves through the nation, market exuberance showed no signs of slowing down. Stocks rallied with about 70% of the companies in the S&P 500 gaining, while Bitcoin cracked a record high above $40,000 and options activity soared.
/bloom.bg/39dPChN

Options Trading Volumes Boost US Exchanges
Shanny Basar – Markets Media
Record levels of retail participation in the U.S. markets last year was one of the factors that boosted options trading volumes on US exchanges in 2020.
Nasdaq said in statement yesterday that 2020 was the first year it led all exchanges in total volume traded for equity options across all categories, including proprietary single-exchange-listed options products. The exchange said it processed 365 million trades and 2.58 billion contracts.
/bit.ly/3pYjfdN

Wall Street wary of ‘frothy’ stocks, bubbly bitcoin
Thyagaraju Adinarayan – Reuters
Wall Street bankers warned of toppy stock markets and a looming near-term retreat after exuberance from unprecedented economic stimulus has led to “frothy” asset prices.
BofA’s latest weekly fund flow data on Friday reflected some of that sentiment, with investors storming into money markets and gold funds while pulling some money out of emerging markets that had attracted billions of dollars over the past 16 weeks.
/reut.rs/2JZRkLa

What We Already Know About Investing in 2021
Jason Zweig – WSJ
For decades I’ve warned investors about the folly of short-term market forecasting, but that doesn’t mean we can’t know anything about the year to come. In fact, we can already predict a few things about 2021 with a high degree of confidence.
In theory, investing is all about markets; in practice, it’s more about marketing. What will financial marketers sell in 2021? The same thing they always sell: whatever did the best last year.
/on.wsj.com/35kV8hi

Bitcoin’s Volatility Resumes After $40,000 Topped for First Time
Vildana Hajric and Olga Kharif – Bloomberg
Digital currency had more than doubles in less than a month; Cryptocurrency market cap is five times year-ago levels
Bitcoin’s wild price swings resumed after the the world’s largest cryptocurrency climbed above $40,000 for the first time. After jumping as much as 11% to $40,394, Bitcoin fell around $3,500 in about half an hour and continues to fluctuate. Prices vacillated as much as 17% on Monday. The digital token has more than doubled in less than a month.
/bloom.bg/3rZosnk

*****See also: “Bitcoin’s Hot 2021 Continues With Move Above $40,000” by Paul Vigna, WSJ.~MR

FLASH FRIDAY: It Was a Very Good Year (in Options)
Traders Magazine Editorial Staff
Overall, 2020 will go down in history as a uniquely awful year, as the Covid-19 global pandemic took almost 2 million lives worldwide and altered life as we know it from mid-March. But there were bright spots, one notably being capital markets. People adjusted to work-from-home routines; after a rapid and scary drop, financial markets came roaring back; and trading activity was brisk.
bit.ly/35EetKT

Exchanges and Clearing

Eurex more than satisfied with MSCI December roll results; 96 percent market share in MSCI Asia underlying futures, 50 percent in MSCI derivatives globally
Eurex
Eurex continues the success story of its MSCI segment in the December roll month and once again proves that it is the exchange of choice for trading Asia Pacific MSCI derivatives. After the recent roll, Eurex starts the first quarter holding more than 86 percent of global Open Interest in MSCI derivatives on Asian underlyings, compared to 47 percent at the end of 2019. Overall, Eurex holds 50 percent market share globally in MSCI related derivatives.
/bit.ly/35owwnZ

Equity derivatives: New Capacity Group for futures and options on Unilever PLC
Eurex
Eurex Circular 002/21 Equity derivatives: New Capacity Group for futures and options on Unilever PLC
/bit.ly/2LcFjm9

Equity derivatives: A. Introduction of Single Stock Futures; B. Withdrawal of admission of Single Stock Futures and Equity Options
Eurex
Eurex Circular 001/21 Equity derivatives: A. Introduction of Single Stock Futures; B. Withdrawal of admission of Single Stock Futures and Equity Options
/bit.ly/3bkaQND

Miami International Holdings Reports 2020 Trading Results, Market Share and Volume Records for MIAX Exchange Group
MIAX
Miami International Holdings, Inc. (MIH) today reported 2020 year-end options trading results for its three national securities exchanges – MIAX, MIAX Pearl and MIAX Emerald (together, the MIAX Exchange Group), with each of the three exchanges and the MIAX Exchange Group setting new market share and volume records over the course of the year. The MIAX Exchange Group’s market share increased approximately 19% year-over-year compared to 2019.
/bit.ly/2EDZmG7

Euronext announces volumes for December 2020
Euronext
Euronext, the leading pan-European market infrastructure, today announced trading volumes for December 2020.
bit.ly/3blNlnd

Education

What Is The VIX Volatility Index? – Forbes Advisor
Miranda Marquit and Benjamin Curry – Forbes
The CBOE Volatility Index—also known as the VIX—is a primary gauge of stock market volatility. The VIX volatility index offers insight into how financial professionals are feeling about near-term market conditions. Understanding how the VIX works and what it’s saying can help short-term traders tweak their portfolios and get a feel for where the market is headed.
/bit.ly/2XoJRs8

Events

2020 Annual Trends in Futures and Options Trading
FIA
Description: This webinar will highlight the main trends in trading activity in 2020 in the global exchange-traded derivatives markets, with category and regional breakdowns as well as exchange and contract rankings.
Presenter: Will Acworth, Senior Vice President of Publications, Data & Research, FIA
Time: Jan 27, 2021 10:30 AM in Eastern Time (US and Canada)
/bit.ly/35iLcoJ

Miscellaneous

CEO Insight – China’s evolution is a trend to watch in 2021
FIA
In 2020, cleared derivatives markets around the world dealt with many challenges as the result of the COVID-19 pandemic. But after closing the books on a historic year, it’s important to point out that our industry continued to grow and thrive even in the face of these challenges.
And there’s perhaps no better illustration of that growth and resilience than the continued evolution of China’s financial markets. As someone who has been visiting and following the China futures markets for nearly twenty years, this year feels like a tipping point in their development.
/bit.ly/3pYibGI

Under-the-radar funds that crushed 2020, including a new Tiger Cub
Bradley Saacks – Business Insider
For big-name managers, 2020 went either very well or very poorly.
Quants such as Renaissance Technologies, Winton Group, and Bridgewater Associates struggled, losing double-digits in their multi-billion-dollar funds. On the other end of the spectrum, concentrated stock-pickers like Coatue Management, Pershing Square, and D1 Capital all made more than 50% on the year — led by billionaire Bill Ackman’s 70.2% blockbuster performance, while macro managers like Brevan Howard and Andrew Law’s Caxton had resurgent years, according to Bloomberg.
/bit.ly/2LysbYs

(Podcast) TWIFO 231: Rates Rundown, Small Cap Catchup and Bitcoin Blowout
This Week In Futures Options – Options Insider Network
bit.ly/3orGRHb

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