JLN Options: Lockheed Bearish Options Hit Record Before COO Scandal

Nov 12, 2012

Lead Stories

Lockheed Bearish Options Hit Record Before COO Scandal
Nick Taborek and Nikolaj Gammeltoft, Bloomberg
Bearish options trading on Lockheed (LMT) Martin Corp. surged to a record on Nov. 9 hours before the biggest defense contractor said its incoming chief executive officer resigned because of a relationship with a subordinate.
About 57,000 puts changed hands on Nov. 9, the most in data compiled by Bloomberg that goes back to 1995. That compares with daily average volume of 940 bearish contracts in 2012.
http://jlne.ws/TuO4ll

DTCC Weighs Legal Action Over CME Swaps Lawsuit
Katy Burne, NASDAQ
The Depository Trust & Clearing Corp. said Sunday it is considering a response to a lawsuit CME Group Inc. (CME) filed last week against a federal regulator concerning the reporting of derivatives trades, noting that its options include ” possible judicial recourse.”
CME sued the Commodity Futures Trading Commission on Thursday, seeking relief from new laws that force it to report data on privately negotiated derivatives called swaps that are routed to its clearinghouse.
http://jlne.ws/TuRtkf

Is VIX Pricing In The Fiscal Cliff?
ZeroHedge
Much is being made of the drop in VIX today – with some suggesting it indicates confidence that investors believe the fiscal cliff resolution is closer. This could not be further from the truth.
http://jlne.ws/Q8DTpD

Goldman in talks with CFTC over trading loss
MarketWatch
Goldman Sachs Group Inc. GS is in settlement talks with the Commodity Futures Trading Commission after the regulator accused one of Goldman’s former traders of concealing an $8.3 billion futures position, the Financial Times reported on its Website, citing two sources familiar with the planned deal.
http://jlne.ws/TuOCHU

An Obama Economic Team to Sweep Wall Street Clean
William D. Cohan, Bloomberg
When U.S. voters elected Barack Obama president in November 2008, many of us were convinced he would make a top priority of reforming Wall Street, which had just almost succeeded in bringing down our way of life through greed and lack of accountability.
Despite the fact that Goldman Sachs Group Inc. (GS), JPMorgan Chase & Co. (JPM) and Citigroup Inc. (C) were among Obama’s top 10 financial backers in 2008, we were hopeful we would see a change in the system whereby bankers, traders and executives were rewarded every day to take huge, asynchronous risks with other people’s money.
http://jlne.ws/QBrx9l
** Not strictly options related but it has such potentially far reaching effects figured it was worth including here. –JB

Exchanges

NYSE Gaining Ground on Nasdaq in IPO Race
Chris Dieterich, The Wall Street Journal
Technology listings have long been the domain of the Nasdaq Stock Market, but a series of recent wins for the New York Stock Exchange has tightened the race for hosting tech-sector IPOs. Nasdaq OMX Group Inc. maintains a narrow lead in 2012 for attracting tech IPOs. But after Big Board operator NYSE Euronext grabbed flotations from companies including Workday Inc.,  Trulia Inc.  and Palo Alto Networks Inc.,  the race for IPO tech listings this year is as close as ever, according to deal tracker Dealogic. As it stands, Nasdaq has had 17 tech IPOs this year, versus 15 for NYSE. Each exchange keeps its own data that differ from Dealogic’s tally.
http://jlne.ws/SZQiv7

Regulation

SEC Probe of Knight Mistake Under Way
Tom Steinert-Threlkeld, Traders Magazine
The Securities and Exchange Commission has begun to investigate the $457.6 million trading mistake that nearly took under market maker Knight Capital Group in August.
The market maker, in a quarterly filing Friday acknowledged that its flood of erroneous orders on August 1 and the company’s recapitalization on August 6 “are the subject of regulatory investigations.”
http://jlne.ws/QBrlXz

Strategy

Are Binary Options in Japan Really Binary Options?
FXStreet.com
The following is a guest post about the Japanese Binary Options from Takashi Ozeki. The goal of the post is to inform readers about the differences between binary options market in Japan and the rest of the world. The article reviews the different elements of binary options trading in Japan and how it compares or contrasts to products being marketed elsewhere.
http://jlne.ws/TuQJvd

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Seeing red: tricky times in the markets

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