Lead Stories

A Better Mousetrap for the VIX? We’re About to Find Out
Chris Dieterich – Barron’s
Brace yourselves for VIX-tracking ETFs that actually will track the CBOE Volatility Index.

Perfect Insider Traders Got Caught
Matt Levine – Bloomberg
Two things that I say a lot around here are: If you have inside information about an upcoming merger, don’t buy short-dated out-of-the-money call options on the target, and Boy a lot of people enjoy both playing golf and insider trading, don’t they? I feel like … I hate to flatter myself here, but is it just possible that these guys have been reading Bloomberg View?

Breaking Down the ‘Biggest VIX Trade Ever’
Adam Warner – Schaeffer Research
Amid all the excitement this week of … well, nothing in particular … we had the “largest CBOE Volatility Index (CBOE) options trade ever”! Yes, on Tuesday, VIX saw a humongous call spread, per Jamie Tyrell’s VIX Sonar Report.

Ruble Options Show Rally to End as Central Bank Starts Purchases
Ksenia Galouchko – Bloomberg
The chances of the ruble adding to this year’s world-beating gains have declined since Russia’s central bank said it would start buying foreign currency, options data show.

Volatility hits F&O traders most as stoplosses gets triggered either side
Economic Times
The volatility in the Indian market is hurting the day traders badly. The wild swings on the Nifty are triggering stoplosses on both buy and sell side forcing traders to exit making losses.

A Rule of Thumb for VIX Watchers: What VIX Levels to Expect When Volatility Surges
Reid Steadman – S&P Dow Jones Indices Indexology Blog
Today, the Wall Street Journal ran an article titled “Volatility for Stocks Stays in Check.” But what caught my eye was the sub heading, “Expected wide stock-price swings fail to emerge, with no S&P 500 move of 2%, up or down, this year.”


CME Group Announces the Launch of Cocoa Options on CME Europe
CME Group Press Release
CME Group, the world’s leading and most diverse derivatives marketplace, today announced the launch of options on its Physically Delivered Cocoa futures contracts. These options will be listed on CME Group’s European exchange, CME Europe, for first trade date on 29 June, 2015. Cocoa options are authorised and approved by the United Kingdom (UK) Financial Conduct Authority.

Dalian Commodity Exchange Completes Collaborative Testing For Options Market Making
On April 30, after 28 trading days of heated transactions, trading after a fiery, the simulation testing of Dalian Commodity Exchange (DCE) for market making of the soybean meal options (the “Collaborative Testing” for short) was crowned with success.

ForexClear earmarks 2016 for FX options clearing
FX Week
CCP time-stamps FX options-clearing plan, albeit for the third time since 2011, as concerns remain over currency delivery LCH.Clearnet-owned ForexClear is planning to launch an FX options-clearing service next year, subject to regulatory approval, FX Week has learned. The proposal is understood to involve FX settlement utility CLS, but as yet no working details have been revealed. A spokesperson for the central counterparty clearing house (CCP) confirmed the plans, but declined to expand.

BM&F BOVESPA Announces Results For The First Quarter of 2015
BM&F BOVESPA Press Release
BM&FBOVESPA S.A. today reported its first-quarter earnings for the period ending on March 31, 2015. The increase in revenues from derivatives and other business lines not connected to volumes, coupled with higher financial results supported the 3.2% year-over-year growth of adjusted net income.

Cantor Exchange President Richard Jaycobs: “US model is the future for binary options”
Andrew Saks-McLeod – LeapRate
Cantor Exchange President Richard Jaycobs considers the on-exchange modus operandi for binary options that is the law in the US to be the way forward for the entire industry globally. In an interview with LeapRate, all is explained.

CBOE, C2 and CFE Trading Schedule For the Memorial Day Holiday
CBOE Press Release
CBOE Holdings, Inc. today announced the following trading schedule for Chicago Board Options Exchange, C2 Options Exchange and CBOE Futures Exchange in observance of the Memorial Day holiday.

Intercontinental Exchange Announces 2015 Annual Meeting Results
ICE Press Release
Intercontinental Exchange, the leading global network of exchanges and clearing houses, announced today the result of the company’s 2015 Annual Meeting of Stockholders, which was held May 15, 2015.

Regulation & Enforcement

SEC a stumbling block in banks’ forex guilty pleas: sources
Karen Freifeld, Sarah N. Lynch and Soyoung Kim – Reuters
Banks want assurances from U.S. regulators that they will not be barred from certain businesses before agreeing to plead guilty to criminal charges over the manipulation of foreign exchange rates, causing a delay in multibillion-dollar settlements, people familiar with the matter said.

U.S. rejects Canada’s claim that Volcker rule violates NAFTA
Jonathan Spicer – Reuters
The White House has dismissed the Canadian government’s claim that a ban on some proprietary trading on Wall Street violates a free-trade agreement, saying it has the legal right to protect its financial system.

NOM Bid/Ask Differentials for “NDX” and “PCLN” Options Class through June 20, 2015
NASDAQ Press Release
The below market maker quote width requirements for options overlying NDX and PCLN on NOM will be effective through June 20, 2015 unless withdrawn by NOM prior to that time.

BIS moves to end confusion over conflicting FX codes of conduct
Solomon Teague – Euromoney
The Bank for International Settlements (BIS) has formed a new FX working group to settle the problem of conflicting codes of conduct for FX market practitioners, promising to draw the best from all six existing codes to create a single document that will be universally applicable.


Far Out: Low Volatility Can Put Options Opps On The Horizon
David Settle – Benzinga
When most people think of extreme conditions in the stock market, they imagine sharp sell-offs and high volatility. But those aren’t the only possible extremes. Stocks can also move sharply higher, and volatility can sink to the cellar.


Derivatives firms unite for Futures for Kids day
The Trade News
To mark the inaugural Futures for Kids day, the charity backed by some of the biggest firms in the derivatives industry opened the London Stock Exchange this morning as it looks to build on the GBP2 million it has already raised. The charity was launched in 2008 by a group of individuals from the futures and options industry in order to provide a focus to channel funds to children’s charities at home and abroad.

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