Lead Stories

VIX Avoids Longest Streak of Increases After Jobs Data
Nikolaj Gammeltoft & Lu Wang – Bloomberg
The benchmark gauge for U.S. stock options fell, halting an eight-day streak of gains, after better-than-estimated jobs data fueled a rally in equities.
http://jlne.ws/18Jjhxs

VSTOXX Reacts Quickly to Euro STOXX 50
NASDAQ
While some have visions of sugar plums dancing in their heads at this time of year, quite possibly the result of excess slivovitz , I have the vision of a world wherein volatility measures can be traded independently of price opinion. Maybe in 2014, but I doubt it: As investors are naturally long stock and not (non-embedded) call options, they tend to ignore call options on the way up and buy put options on the way down.
http://jlne.ws/18Jjyk7

What to Expect from the VIX this Month
Adam Warner – Schaeffer’s Investment Research
Well, it’s a December to Remember so far in the market, especially if you were rooting for a decline. We’re down five days in a row, albeit the dip is only about 1% total in the SPDR S&P 500 ETF Trust (NYSEARCA:SPY).
But it wasn’t always thus.
http://jlne.ws/18Jk9Ch

Videocast: Volatility gets ‘smoked’
optionMONSTER
http://jlne.ws/18Jl2e4

Exchanges

CME Data Fee Increase More Onerous than Originally Thought
Dan Collins – Dan Collins Report
I ran into an old friend at the Chicago Board of Trade yesterday and he told me the following joke: “What does Obamacare and CME Group’s new data fees have in common? One is 28,000 pages the other is 18 pages and both were voted on without anyone reading them.”
http://jlne.ws/1cfyfXb

CME in Final Stage of BOE Talks on Europe Exchange, CEO Says
Nandini Sukumar and Chanyaporn Chanjaroen – BloombergBusinessweek
CME Group Inc. (CME:US) is in the final stages of talks with the Bank of England to start a new European exchange and is confident it will be allowed to offer currency futures, according to its chief executive.
http://jlne.ws/1cfwLMD

HKEx and SGX put aside rivalry with China deal
Future and Options Intelligence
Due to their size, proximity to each other and links to China, the Singapore Exchange and Hong Kong Exchanges and Clearing are seen as rivals.
They both focus on index derivatives – SGX has the Nikkei 225, MSCI and the China A50 while Hong Kong’s flagships are its Hang Seng and H-Shares Index derivatives.
The exchanges are also trying to establish themselves as the gateway to the closed Chinese derivatives markets with the listing of futures contracts based on the country’s indices.
http://jlne.ws/1cfAJ83

EMCF and EuroCCP Complete Transaction to Form Largest Pan-European Equities Clearing House
Press Release (BATS)
EMCF and EuroCCP, two leading pan-European cash equities clearing houses, today announce that the transaction to combine the two entities is now complete. The combined clearing houses will form Europe’s largest cash equities central counterparty, further improving the efficiency of European equities clearing.
http://jlne.ws/1f4akOi (PDF)

Regulation and Enforcement

Traders Call Derivative Rules Illegal & Unfair
Ryan Abbott – Courthouse News
Swaps and derivatives traders sued the U.S. Commodity Futures Trading Commission, claiming its new guidelines for cross-border trading are thinly veiled regulations that were adopted illegally.
http://jlne.ws/1cfv3uG

Guidelines prompt buy-siders to improve OTC reconciliation
John Bakie – The Trade
Large numbers of buy-side firms are looking to improve reconciliation processes for their derivatives trades following the introduction of new regulation.
http://jlne.ws/1cfw2uU

A Last-Minute Push to Rein in Wall Street
Silla Brush and Robert Schmidt – BloombergBusinessweek
Gary Gensler is sending a message to Wall Street: I am not leaving Washington quietly. In his final weeks as chairman of the Commodity Futures Trading Commission, Gensler has had the agency issue more than a dozen advisory opinions that close loopholes or tighten rules that govern the largest financial firms and swaps traders.
http://jlne.ws/1d4FO55

Strategy

Follow the Yellow Brick Road
Don Dawson – The Options Insider
Gold has historically had lower volatility than other Commodity products and Stock Index Futures. Having an asset with lower volatility in your portfolio may help to see more consistent percentage gains along with potentially lower risk. If you were to look at Gold and compare it to an asset class, the most closely related would be the currency markets.
http://jlne.ws/1cfAV7i

How to Short A New High
Sam Seiden – The Options Insider
I often get asked, “How and when should you short a new high?” My answer is almost always the same. I almost always suggest you should NOT short a new high. Instead, keep buying pullbacks to fresh demand levels.
http://jlne.ws/1cfB4aO

Options Education

Does Volatility Matter?
Gabe Velazquez – The Options Insider
In the last several weeks, there has been lots of talk among traders about the small intraday ranges in the S&P 500 e-mini futures contract.  Yes, volatility in the stock index futures has been subdued lately, largely due to the fact that three of the major averages (S&P 500, the Dow Industrials, and Russell 2000) continue to breach their all-time high.
http://jlne.ws/1cfz02u

Not Trading Is A Trading Decision
Brandon Wendell – The Options Insider
There is a lot of unnecessary pressure placed on traders. We place the most pressure on ourselves. After completing an education program and opening our trading account, we feel that we must trade as much as possible.  There is a desire to try and profit from our trading knowledge as quickly as possible. The problem is that; trading is more of a marathon than a sprint.
http://jlne.ws/1cfuUr3

 

 

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