JLN Options: ISE Files With SEC to Start Topaz as 12th U.S. Options Exchange

Mar 4, 2013

Lead Stories ISE Files With SEC to Start Topaz as 12th U.S. Options Exchange
Nina Mehta, BloombergBusinessweek
International Securities Exchange Holdings Inc. plans to start an options market called Topaz Exchange. If approved it will be the twelfth U.S. exchange for equity derivatives.
***Can we stop at 12? Because we can’t have 13 exchanges sitting down to dinner.  — SR NZX to launch equity derivatives market
Justin Lee, Risk.net
New Zealand Stock Exchange to launch equity derivatives to meet demand for hedging instruments
The New Zealand stock exchange (NZX) will launch an equity derivatives market in May, following consultation with market participants, says the exchange.
http://jlne.ws/XFZ6aw As Market Nears Highs, Options Investors Show Nervousness
Kaitlyn Kiernan, The Wall Street Journal
As the Dow Jones Industrial Average hovers near a record, many options traders are preparing for the worst, with one investor expressing fear that the blue-chip index could test the lows of last June by the beginning of next year.
http://jlne.ws/XFVbdB OCC Announces Cleared Contract Volume Declined 8% in February
Press Release (OCC)
OCC announced today that total cleared contract volume in February reached 325,237,351 contracts, representing an 8 percent decrease from the February 2012 volume of 351,702,360 contracts. OCC’s year-to-date cleared contract volume is up 0.19 percent from 2012 with 690,265,229 contracts.
http://jlne.ws/Z2uL79 Volume and Commissions Seen Up
John D’Antona Jr., Traders Magazine
There is only one way to go when things hit rock bottom: up.
That’s the view on U.S. equity trading commissions and volume this year. One consultancy forecast that commissions will rise 9 percent and volume move up 6 percent.
http://jlne.ws/XG0ABF Berkshire Profit Advances 49% on Buffett’s Derivatives
Noah Buhayar & Zachary Tracer, Bloomberg
Berkshire Hathaway Inc. (BRK/A) said fourth- quarter profit rose 49 percent on gains tied to derivatives wagers made by billionaire Chairman and Chief Executive Officer Warren Buffett.
http://jlne.ws/XRsJn6 Japanese Derivatives Halted After Osaka System Crashes
Anna Kitanaka, Toshiro Hasegawa & Kana Nishizawa, Bloomberg
Nikkei 225 Stock Average futures volume plunged more than 90 percent today as a software error forced a halt to Osaka trading of some derivatives, the first outage for Nasdaq OMX Group Inc. (NDAQ) technology installed in 2011.
http://jlne.ws/XRsFDQ Will VIX Sequester Itself? Weekly VIX ETF Report
Wall Street Sector Selector
VIX ETFs had a field ‘week’ last week likely over new fear regarding the anticipated sequester and implications thereof.  But, equity markets shrugged off the sequester, leaving the VIX Index and equity markets at odds with each other, creating very interesting scenarios for next week.
http://jlne.ws/XFP09C The VIX has Flipped
ETFGuide (via NASDAQ)
Darell Huff wrote in his 1954 book ‘How to Lie with Statistics’, “If you torture the data long enough, it will confess to anything”.  I am about to do just that with the Volatility Index.
http://jlne.ws/XFUxwE To the Contrary
Peter Chapman, Traders Magazine
The U.S. economy is on the mend. The European debt crisis is under control. The financial crisis of 2008 is receding into memory. Volatility is tamed. And yet derivatives based on the Chicago Board Options Exchange Volatility Index have never been more popular.
http://jlne.ws/XFUQHO What Happened?
Traders Magazine
It was supposed to be a big deal.
In October 2011, when CBOE Holdings listed its SPXpm contract on its all-electronic C2 exchange, both brokers and exchange officials expected the listing to be a giant hit because, for the first time, CBOE offered automated executions in an index option based on the S&P 500.


ISE Reports it is the Largest Equity Options Exchange in February 2013
Press Release (ISE)
The International Securities Exchange (ISE) today reported average daily volume of 2.7 million contracts in February 2013. This represents an increase of 1.3% compared to February 2012. Total options volume for the month was 51.5 million contracts. ISE was the largest U.S. equity options exchange in February with market share of 18.1%*.
http://jlne.ws/Z2vANr CBOE Holdings Reports February 2013 Trading Volume
Press Release (CBOE)
CBOE Holdings, Inc. (NASDAQ: CBOE) reported today that February  trading volume for options contracts on Chicago Board Options Exchange (CBOE) and C2 Options ExchangeSM (C2SM) and futures contracts on CBOE Futures ExchangeSM (CFE) totaled 83.14 million contracts. Average daily volume (ADV) in February was 4.38 million contracts, up three percent from 4.24 million contracts in January 2013 and down 15 percent from 5.14 million contracts in February 2012.
http://jlne.ws/XFVKEi CME’s Daily Trading Volume Jumps in February
Dow Jones Newswires (via Fox Business)
CME Group Inc.’s (CME) its trading volume pick up last month and also rise from a year earlier.
Daily volume at the world’s largest futures-market operator averaged 13.7 million a day contracts last month, up 7% from February 2012 and up 20% from January.
http://jlne.ws/XFU25O ICE Reports February Futures Volume
Press Release (ICE)
IntercontinentalExchange (NYSE: ICE), a leading operator of global markets and clearing houses, today reported futures volume for February 2013. ICE’s average daily volume (ADV) for futures and options was 3,640,377 contracts, a decline of 10% from the prior February. Total contract volume in February 2013 was 69 million. All prior period contract volumes have been adjusted to include the transitioned futures contracts, which previously traded in ICE’s OTC markets.


Don’t Choke On This Options Strategy: The Strangle
JJ Kinahan, Forbes
Many are looking at this market, with the S&P 500 (SPX) trading up at the 1520 level, and saying it seems to be completely overbought. However, others have spent their time looking at the numbers and are absolutely positive that, although there may be bumps in the road, this rally is going to continue.

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