Not Over Yet: Twists And Turns Still Ahead Including Nike Earnings, Quadruple Witching; Nasdaq resumes trading of certain ETF options

Dec 16, 2019

Lead Stories

Not Over Yet: Twists And Turns Still Ahead Including Nike Earnings, Quadruple Witching
JJ Kinahan – Forbes
A lot of holiday packages got wrapped up last week, including a Phase One trade deal, a Fed meeting, and the UK election, but the week ahead still has a few bows left to tie. We’re in the home stretch of 2019, with this week probably the last of the year to feature any major volume before people head off for the holidays. Several major earnings reports, with Nike (NKE) being one of them, highlight the coming days. There’s also key housing data and a “quadruple witching” (see more below). Things aren’t over yet for this old year.

Nasdaq resumes trading of certain ETF options
Saqib Iqbal Ahmed – Nasdaq
Trading in the options on certain exchange traded funds, including the iShares MSCI Emerging Markets ETF (EEM.P) and the iShares Core S&P 500 ETF (IVV.P), was resumed on Nasdaq’s exchanges after a brief halt, Nasdaq said on Monday. Nasdaq had halted trading in options on some ETFs on Monday due to late notification of capital gains distributions, the exchange said in a system status message.

Cboe exchange files to list new short volatility ETF
Saqib Iqbal Ahmed – Reuters
Cboe BZX Exchange has sought permission from the Securities and Exchange Commission to list shares of an exchange traded fund that would let investors bet against stock market gyrations, according to a regulatory filing. The filing, dated Dec. 10, comes nearly two years after another short volatility exchange traded product, the VelocityShares Daily Inverse VIX Short Term ETN, popularly called ‘XIV’, collapsed leading to billions of dollars in losses for investors.

Easing Worries Push Investors Out of Havens, Drive Stocks to New Highs
Ira Iosebashvili – The Wall Street Journal
Investors are pulling back from positions in haven assets like gold, the Japanese yen and dividend-paying stocks, a sign of mounting optimism as recent developments ease long-held worries about trade and global growth. Gold prices have fallen around $85 a troy ounce from September’s six-year high and the value of assets held by the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, are down nearly 7% from their October highs. Prices for silver are off nearly 15% from their September peak.

First Week of XLRE May 2020 Options Trading
BNK Invest – Nasdaq
Investors in The Materials Select Sector SPDR Fund (Symbol: XLRE) saw new options become available this week, for the May 2020 expiration. One of the key inputs that goes into the price an option buyer is willing to pay, is the time value, so with 151 days until expiration the newly available contracts represent a potential opportunity for sellers of puts or calls to achieve a higher premium than would be available for the contracts with a closer expiration.

Exchanges and Clearing

Deribit exchange reports ‘unusual proportion’ of puts trading
Manu Naik – AMB Crypto
Recently on Twitter, Bitcoin and ETH derivatives data analytics firm, Skew, reported an unusual proportion of puts trading on the Deribit exchange over the last two days. Generally, put options become more valuable as the price of the underlying asset depreciates in value relative to the strike price set on the contract. An increase in put contracts likely means that more market participants are bearish on Bitcoin’s price action for the next term.


Gatsby launches free options trading for millennials, Gen Z
Penny Crosman – American Banker (subscription)
Gatsby, a fintech startup bringing options trading to millennials and Gen Z, is launching Monday. Where apps like Acorns, Stash and Robinhood have made people more comfortable with the idea of trading stocks over their smartphones, Gatsby takes this trend one step further, letting people buy and sell options contracts that give them the right to buy or sell a company’s stock at a certain price within a given time period.


Tesla’s ‘Cybertruck’ could send the stock back toward all-time highs, options traders say
Tyler Bailey – CNBC
Tesla shares are soaring, and when the electric automaker unveils its “Cybertruck” on Thursday night in Los Angeles, options traders are betting that the rally will hit even higher speeds. Despite finishing Wednesday’s session in the red, Tesla has surged a whopping 74% in the last six months, breaking into positive territory on the year and closing in on highs not seen since last December. If the options market is right, the stock will break out above those highs when Tesla unveils its electric pickup truck.

The chip rip has only just begun, options trader says
Tyler Bailey – CNBC
Semiconductor stocks are surging on news that the U.S. and China have agreed to the first phase of a trade deal between the two countries, and the options market is betting that this is just the beginning of an even bigger chip rip. The trade-sensitive group of names just broke out to brand-new 52-week highs, and Tribeca Trade Group CEO Christian Fromhertz says there are reasons to believe this is the beginning of a sustained move higher.


What You Need to Know About Amending Your Tax Returns
Tom Herman – The Wall Street Journal
As Oscar Wilde once put it, experience is the name we give our mistakes. By that standard, millions of taxpayers are highly experienced. Even with the increasingly widespread use of sophisticated tax-preparation software, it’s easy to make costly errors, omissions or both. Last year, the Internal Revenue Service received nearly 3.5 million “amended” income-tax returns, says Eric Smith, an IRS spokesman.

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