Here are the 15 stocks that have driven a record-setting surge in options trading; Options trades pointing to ’50 Cent’ accumulate ahead of Super Tuesday

Feb 13, 2020

Lead Stories

Here are the 15 stocks that have driven a record-setting surge in options trading
Carmen Reinicke – Markets Insider
As stocks continue to gain, a pickup in trading of consumer discretionary is also pushing options volumes to a record high.
Single stock options volumes have gained 77% in the last six weeks, continuing to gain after starting the year at an all-time high, according to a Wednesday note by Goldman Sachs.

Options trades pointing to ’50 Cent’ accumulate ahead of Super Tuesday
April Joyner – Reuters
Options positions reminiscent of the mystery trader known as “50 Cent” are building up ahead of the “Super Tuesday” U.S. primary elections and other potentially market-moving events.
At least one investor bought a block of 100,000 calls on the CBOE Volatility Index at a price of 49 cents each on Wednesday morning. The calls would rise in value if increased volatility pushed the VIX up from its present levels.

Traders Pay to Hedge Against Deeper-Than-Expected Fed Easing
Vivien Lou Chen and Edward Bolingbroke – Bloomberg
Some investors are paying up to hedge against the risk that the Federal Reserve will need to cut interest rates much more deeply than most expect this year. There was a flurry of trades Wednesday in eurodollar options that stand to benefit if Chairman Jerome Powell and his colleagues end up implementing much more than the one or two quarter-point cuts that are currently being priced as a central scenario for 2020.

Goldman, JPM kick off SOFR swaptions (subscription)
Helen Bartholomew –
The first swaptions linked to the new US risk-free rate, SOFR, have traded in size, with two block trades between Goldman Sachs and an end-user client hitting swap data repositories earlier this month.

Looking at the world through the eyes of options traders
The Economist (subscription)
Every stoner knows, or has bored you silly, about the third eye. It is the imaginary oracular organ you develop as a side-effect of taking hallucinogens. The data from hazy late-night discussions in college dorms in the 1960s are quite clear on this. The strait-laced are too middle-of-the-road to grasp what is really going on in the world. The third eye allows you to see what they simply cannot. Every investor could use a third eye. But there is one type who can claim to need it the most: options traders.

‘The force is strong with the market’: The crypto derivatives market is heating up
Frank Chaparro – The Block
CME and Bakkt both clocked in 2020 records on Tuesday. The derivatives market activity is underpinned by what looks like a crypto comeback.
The market for derivatives tied to cryptocurrencies is heating up, according to the latest available data. Bakkt, which rolled out its bitcoin futures product in September 2019, saw volumes for the product top $37 million – a performance record for 2020, data from Skew shows.

Exchanges and Clearing

CME Globex Notices: February 10, 2020
CME Group


CME SPAN Software Update Now Available (Version 4.5.610)
CME Group
PC-SPAN and SPAN Risk Manager version 4.5 build 610 are now available for download in the CME CORE download center. This is now the active build; support for older builds will cease in the coming months.


These 3 words describe one ‘black swan’ investor’s approach to managing his $5 billion fund through a market crash
Shawn Langlois – MarketWatch
That’s how Mark Spitznagel, the founder of Universa Investments, described his approach to navigating market risk in an interview with Vanity Fair that published Thursday.
Basically, he says he makes far out-of-the-money bets that cost little but deliver huge when it all comes crashing down.

The Ultimate Options Strategy: Vishal B Malkan will help simplify trading options and investing jargon in his seminar
Economic Times
Can a layman really make money trading options? Is options trading simple and easy for everyone to understand? The most common problem with trading options is the jargon involved, which makes it very complicated for a layman to understand. Vishal B Malkan, author of #CASHTAGS and renowned trading coach who started his career when he was 16, says, “In 2000, when options trading began in India, there was not much flurry because most people were not aware of what it was all about. There was jargon involved such as Greeks and volatility, which sounded complicated. In the next three to four years, it began gaining momentum.”


What Would You Put In A 100-year Portfolio?
RCM Alternatives
A simple question, really. But not one we read much about in today’s world of instant gratification and investments jettisoned at the first signs of stress. So, when we were sent the latest research piece by Chris Cole of Artemis, we dug in (you can read the piece here). Now, Cole loves him some animal metaphors – as evidenced by their deer logo, and title of this piece – the allegory of the hawk and serpent, but it was the subtitle which caught our eye: How to Grow and Protect Wealth for 100 years.

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