JLN Options: Trading Volume In The 'Fear Gauge' Exploded To An All-Time High During The Government Shutdown; One Fear Gauge Trader Looks in Horror at New Debt Ceiling Date

Oct 21, 2013

Lead Stories

Trading Volume In The ‘Fear Gauge’ Exploded To An All-Time High During The Government Shutdown
Matthew Boesler – Business Insider
Trading volume in the VIX (a measure of the implied volatility of S&P 500 index options known as the “fear gauge”) hit record highs over the past two weeks as the government shutdown and debt ceiling debate became the dominant theme in financial markets.
http://jlne.ws/Hb0nDd

Russell 2000 Index Option Volume Update – Look at that Growth!
Bill Ryan – NYSE Euronext
Russell U.S. Index Options began trading on NYSE Amex and NYSE Arca Options on a semi-exclusive basis along with another exchange group in April 2013. Over the course of 6 months of trading, NYSE Amex and NYSE Arca have seen considerable growth in Russell 2000 Index options (RUT) volume.
http://jlne.ws/1i9fO9Z

One Fear Gauge Trader Looks in Horror at New Debt Ceiling Date
Kaitlyn Kiernan – The Wall Street Journal
Even as most investors put the debt-ceiling fight behind them, one options trader Friday made a big bet that another flare-up in Washington is in the cards for February.
http://jlne.ws/HaXKkM

NYSE Cancels Mistaken Options Trades on Dow Average, S&P 500
Nick Baker – Bloomberg
NYSE Euronext (NYX) canceled some options trades tied to three of the most-watched U.S. equity indexes after determining they were mistakes.
http://jlne.ws/1i9dH67

Stock Market Is Trending Perfectly Within the Rules of Elliott Wave Theory
NASDAQ
Over the past couple of weeks there has been a crash in confidence followed by a crash in fear, yet these extreme emotional swings have gone largely unnoticed for their potential foreshadowing of things to come.
http://jlne.ws/1i9h3WK

ASX Introduces Volatility Futures Trading on S&P/ASX 200 VIX (1)
Nikolaj Gammeltoft and Nick Baker – BloombergBusinessweek
The operator of Australia’s stock market has started futures trading on the S&P/ASX 200 VIX Index, a volatility gauge designed to help traders hedge against stock-market drops and speculate on swings.
http://jlne.ws/Hb03V5

Videocast: VIX action calms down
optionMONSTER
http://jlne.ws/1i9h6lf

High-speed traders may dodge pay cap
Tim Cave – Financial News
The bulk of London’s high-frequency trading firms are likely to avoid bonus caps being introduced as part of new European capital rules next year, following recent guidance from the UK’s Financial Conduct Authority.
http://jlne.ws/1gyPISn

Hedge Funds Surge to New Asset Record: $2.51 Trillion
Brendan Conway – Barron’s
Say what you will about hedge funds’ 30% performance gap versus the S&P 500. Point out there are too many managers with too much money chasing too few opportunities.
http://jlne.ws/HaWJcv

Exchanges

CBOE Revises Schedule for Expanded VIX Futures Trading
Sam Mamudi – Bloomberg
CBOE Holdings Inc. (CBOE), which delayed the expansion of VIX futures trading hours because of the U.S. government shutdown, revealed the process will now take place on Oct. 28 and Nov. 4.
http://jlne.ws/1i9dq2R

Wall Street banks learn how to survive in staged cyber attack
Lauren Tara LaCapra – Reuters
A few months ago, a group of Wall Street banks fashioned a risk-manager’s worst nightmare to determine how they would survive. Luckily, it was all pretend.
http://jlne.ws/16mRG3D

What’s next for Euronext in Amsterdam?
FOW
Amsterdam has a long history of being a driver of innovation in the European financial markets. Euronext’s Amsterdam subsidiary will have to harness some of that history to re-establish itself as an independent entity, says William Mitting.
http://jlne.ws/1i9hwIu

Regulation and Enforcement

Financial regulator: Dodd-Frank rules ‘largely completed’
Julian Hattem – The Hill
The country’s top cop for the massive global derivatives market is asserting that his agency has mostly fulfilled the requirements of the Dodd-Frank financial reform law.
http://jlne.ws/17bC0kr

Technology

Eurex: Deutsche Börse Market Data + Services Launches Virtualised Private Simulation – On-Demand Access To Simulation Environment
Press Release
Deutsche Börse Market Data + Services today announced the release of Virtualised Private Simulation (VPS) – a proprietary cloud-based solution providing clients with self-provisioned, on-demand access to Eurex Exchange’s T7 simulation environment.
jlne.ws/16mRG3G

$1trn+ SEF trades via MarkitSERV in 10 days
Press Release
Markit, a leading, global financial information services company, today announced that MarkitSERV has handled more than $1 trillion of swaps traded on swap execution facilities (SEFs) in the first ten business days of SEF trading.
jlne.ws/16mRIbK

Strategy

Use Cheap Options to Buy Stocks
Steven M. Sears – Barron’s
First off, there’s a general belief on the Street that stocks will advance in the shadow of the Federal Reserve easy-money policies — at least until Congress next debates the budget and debt ceiling early next year.
http://jlne.ws/15Y5xuP

Bracing for the Next Budget Crisis
Steven M. Sears – Barron’s
How options can help investors profit from the showdowns that are becoming a regular part of the stock-market landscape.
http://jlne.ws/1i9cZWi

Options Education

Navigating Time Frames
Sam Seiden – The Options Insider
If you are a short term trader making buy and sell decisions on a five minute chart without paying attention to where price is in the larger time frame, my guess is your losing money.
http://jlne.ws/1i9gP1G

 

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