Lead Stories

Bob Ray, London-Based CME Executive From Chicago, Dies at 60
Nandini Sukumar – Bloomberg
Robert Ray, the chief executive officer of CME Group Inc.’s proposed European exchange, has died after a short illness, according to the company. He was 60.
Ray, a native of Chicago, moved to London in 2009 and was working to open a futures market called CME Europe prior to his death. He was previously a managing director responsible for CME Group’s strategy and sales in Europe, the Middle East, Africa and Latin America.

S&P 500 inches up to record close
Dave Shellock – Financial Times
US stocks managed to end the week at record highs although there were clear signs of fatigue on Wall Street, even as the latest non-farm payrolls report offered some much-needed reassurance over the health of the US economy.
The initial mood of bullishness was also tempered by lingering caution about the unfolding situation in Ukraine – although the level of uncertainty was nothing like that seen on Monday, when a wave of risk aversion swept through global markets.

Volatility Index at New Market Highs
Andrew Wilkinson – Wall Street Pit
We recently produced a chart for this column demonstrating that as the market continued to climb its proverbial wall of worry, so too did the measure of options implied volatility – aka the CBOE Vix index. The chart confirmed that for fresh highs for stocks, predicated upon eternal hopes of a spring rebound in the labor market and therefore growth, the fear gauge was tracking higher.

Stock Investors Bullish After Jobs Report, But No Rush To Buy
Matt Jarzemsky – The Wall Street Journal
With the February jobs report coming in better than expected, investors are expressing more confidence about the health of the economy in the face of winter weather that was harsher than usual in many parts of the country. That, investors say, reinforces already bullish sentiment.

Why Investors Are Hedging Despite S&P Highs [VIDEO]
Bloomberg’s Greg Bender discusses the VIX with Julie Hyman on Bloomberg Television’s “Street Smart.”

Videocast: More call selling in VIX

Citi hires Daniel Hanson as Ceemea FX options director
FX – Week
Daniel Hanson, a former foreign exchange options trader at Standard Chartered, has joined Citi as a director, trading FX options in central and eastern Europe, the Middle East and Africa (Ceemea).

Westpac appoints two in Hong Kong, and other recent job moves
Risk Magazine
Selene Chong has been promoted to global head of foreign exchange and precious metals options at HSBC. She will continue to be based in Hong Kong and will report locally to Hossein Zaimi, head of forex and commodities Asia-Pacific, and Frederic Boillereau, global head of forex and commodities. Chong joined HSBC in 2001 and, following positions in London, New York and Hong Kong, was appointed global head of forex and precious metals structuring in 2011.

Regulation and Enforcement

Acting CFTC head pleads with U.S. Congress for more funding
Sarah N. Lynch – Reuters
The acting head of the U.S. derivatives regulator pleaded with federal lawmakers on Thursday to give his agency more funding, saying a tight budget has prevented staff from completing compliance exams and threatens to hobble enforcement.

CME director had ties to AlphaMetrix
Lynne Marek – Crain’s Chicago Business
A board member of futures exchange operator CME Group Inc. loaned money to now-defunct AlphaMetrix LLC and considered consulting for the firm, which was later accused of misappropriating funds. The relationship began as AlphaMetrix was developing software to help CME guard against fraud by futures industry participants.

Be careful of what you (regulators) wish for
Futures Magazine
Big, sweeping changes to any established market run the risk of unintended consequences, particularly when those changes result from multiple pieces of legislation and regulation, often written independently of each other and introduced more or less at the same time.
The UK’s Financial Conduct Authority (FCA) now thinks it might have spotted some in the commodity markets, warning in a report published at the end of last month about the impact a retreat by investment banks may have on market liquidity and transparency.


Three-quarters of FX volumes now executed electronically, say Greenwich Associates
Eva Szalay – FX-Week
Deutsche Bank, UBS, Citi and Barclays now collectively handle almost half of overall global flows as electronic execution in G-10 hits 79% and 56% in emerging markets currencies
Nearly three-quarters of global FX volumes were executed electronically in 2103, up from 71% in 2012, allowing the top four largest currency trading banks, Deutsche Bank, UBS, Citi and Barclays, to tighten their grip on the market by capturing almost half of all flows, according to a report from consultancy firm Greenwich Associates.


Hedging Strategies in a Hot Biotech Market (part 2)
David Sable – Forbes
A few days ago, we considered a couple of strategies to protect gains from the recent biotechnology stock run. Let’s take a deeper look.
The strategies we discussed, selling short a biotechnology index fund or pairing individual short sales to your long positions, are logical but also difficult to do successfully. Index funds can be poor surrogates – and inappropriate hedges — for individual portfolios, placing you at risk to be wrong on both sides of a long-short strategy, losing money on your long names and on your short names.

7 signs we’re near a market top, and what to do now
Michael Sincere – MarketWatch
Remember March 4, 2014 — a day that will go down in Wall Street history as the beginning of the end for this latest bull market, which is about to celebrate its fifth birthday.
On March 4, the Dow Jones Industrial Average rose 227 points based on a report that Russian troops were pulling back from Ukraine’s border. This “news” lit the market on fire, a sign that the market is heading into a mania stage where it doesn’t take much to boost stocks.

RVX Is Probably Cheap
Mark Sebastian – The Option Insider
While most coverage in the media is done on SPX and DJIA,  the really interesting index over the last few weeks has actually been the RUT.  Take a look at the upward momentum in that index.

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