Observations & Insight
Bradley Rotter – Open Outcry Traders History Project, Part Two
Bradley Rotter was on the financial floor of the Chicago Board of Trade when the Treasury bond market was working out its inefficiencies in its early days. Sparse institutional interest in bond futures in the beginning created lots of opportunities and sometimes the markets would move limit up and and limit down in the same day.
Rotter was interviewed by John Lothian for the Open Outcry Traders History Project. This is the second part of a two-part presentation of that interview.
Shanghai Futures Exchange unit to list crude oil options on June 21
Emily Chow – Reuters
A subsidiary of the Shanghai Futures Exchange (SHFE) will list crude oil options on June 21 and make them available to international traders, SHFE Chairman Jiang Yan said on Wednesday at the 18th Shanghai Derivatives Market Forum.
The subsidiary, Shanghai International Energy Exchange (INE), said on May 6 it would conduct a mock test of crude oil options trading from May 10 to May 21.
Currency FX Volatility Set for a Comeback on Looming Policy Shifts
William Shaw and Vassilis Karamanis – Bloomberg
After more than a year of slumber, investors are preparing for currency volatility to come roaring back to life.
From Nomura International Plc to Rabobank, banks are recommending cheap protection against foreign-exchange price swings, which have been muffled so far by a barrage of liquidity and record-low interest rates.
Bitcoin’s Volatility Is Spilling Over to U.S. Stocks, Study Says
Eric Lam – Bloomberg
Bitcoin’s explosive moves are stoking the volatility of U.S. stock futures in haywire trading days, according to Singapore’s DBS Group Holdings Ltd.
In a study that concludes the world’s biggest token is no longer a fringe asset class, DBS’s Chief Economist Taimur Baig and Macro Strategist Chang Wei Liang wrote that S&P 500 contracts tend to register bigger swings after Bitcoin spiked up or down by 10% in the span of an hour.
New ETF Taps Investors’ Fear of Missing the Latest Hot Stock Trend
Evie Liu – Barron’s
Choosing tickers for exchange-traded funds is looking more and more like a hashtag competition. First there was MOON, and then BUZZ. FOMO is the latest, based on the acronym for fear of missing out, a common emotion in the investing world today.
The newly launched FOMO ETF (ticker: FOMO) from Tuttle Capital Management aims to help mitigate that anxiety by packaging all the hot trends in one fund. “We wanted to be very agile, we wanted to be able to really be anywhere that’s been trending and not pigeonholed into one area,” says Matthew Tuttle, the firm’s CEO.
Surging U.S. housing market faces test as people start heading back to offices
Joy Wiltermuth – MarketWatch
What’s keeping traders up at night?
Worries about potential bubbles in U.S. stocks and the housing market have emerged as key concerns for traders thinking about the second half of 2021, according to a recent Charles Schwab survey.
More than 80% of the 500 traders surveyed said they thought it was likely that both housing and stocks already were in a bubble.
Stocks Edge Up as Worries Around Inflation Abate
Caitlin Ostroff and Amber Burton – WSJ
U.S. stocks rose on Wednesday as investors grew more comfortable that the Federal Reserve and other central banks would maintain their economic support despite a near-term bout of inflation.
The S&P 500 gained 0.3%, as the broad market index posted modest gains after declining Tuesday. The Nasdaq Composite rose 0.6%. The Dow gained 0.2%. Wednesday marks the 125th anniversary of the launch of the Dow Jones Industrial Average.
Exchanges and Clearing
Corporate Tax Rate Futures Now Trading on MGEX
Corporate Tax Rate Futures offer corporations and investors an efficient way to manage
risk in uncertain corporate tax rate environments
MIAX Press Release
MIAX , operator of high-performance securities exchanges, products and services, and the Minneapolis Grain Exchange (MGEX) today announced the successful first day of trading in Corporate Tax Rate Futures on the MGEXon May 24, 2021.
Equity Index Derivatives: Passive Liquidity Protection: Stepwise rollout into index options in 2021 and 2022
With this circular, we would like to inform you about the planned rollout of the Passive Liquidity Protection (PLP) into further Eurex index option products which will start with the first step on 31 May 2021 with the FTSE 100 index option (OTUK). The deferral time for OTUK will be set to three milliseconds. PLP will be available in the Eurex simulation for OTUK with production-like deferral times starting 26 May 2021.
MayStreet boosts coverage in Asia Pacific with 19 new markets; The new content includes real-time and historical consolidated, top-of-book and full depth-of-book data from the equity, derivatives, commodity and fixed income regional exchanges.
Annabel Smith – The Trade
Market data infrastructure provider, MayStreet, has expanded its coverage in Asia Pacific with the addition of 19 new markets to its Market Data Lake. The additional markets include Australia, Hong Kong, India, Japan, Korea, Malaysia, Singapore, and Taiwan including the Australia Securities Exchange, Chi-X Australia, Hong Kong Stock Exchange and Futures Exchange, and the Singapore Exchange among others.
SPDR S&P 500 ETF (SPY) Short Interest Climbs to Highest Level of 2021
Sam Potter and Kamaron Leach – Bloomberg
Investors are increasing wagers against the S&P 500 by shorting the world’s biggest exchange-traded fund.
With the benchmark U.S. equity gauge oscillating near its all-time high, short interest in the $357 billion SPDR S&P 500 ETF Trust (ticker SPY) has jumped to the highest this year, according to IHS Markit Ltd. data.
Changing derivatives strategies to address the new normal
Eurex and Risk.net
The events of 2020 have propelled liquidity and collateral management to the top of the priority list for many buy-side organisations. A recent survey by Risk.net and Eurex explored how derivatives strategies are changing in response.
Operational complexity intensified across global financial markets during 2020. The outbreak of Covid-19 in December 2019, the ensuing global pandemic and continued Brexit developments have reverberated throughout the markets, prompting participants to rethink their business strategies.
Asset Management Derivatives Forum 2021
Co-hosted with SIFMA AMG
8 June 2021 – 9 June 2021 • 10:15 AM – 1:30 PM ET Daily • VIRTUAL
FIA and SIFMA AMG are bringing you a virtual take on the Asset Management Derivatives Forum in 2021. Join us for virtual programming on June 8 and 9, during which market participants from all sides of a trade and leading regulators will examine the latest developments impacting the use of derivatives by asset managers, including business, clearing, regulatory and operations issues.
Technological Revolution for Clearing Derivatives?
As the global volume of exchange-traded derivatives continues to rise, entities have been preparing for post-pandemic work environments. Be it in-person, remote or a hybrid of the two, these challenges place a burden on operational capacity with the potential to interrupt processes. What transformational level of efficiency across derivatives operations is needed? Can the technology sector develop industry-wide utility solutions to achieve efficiencies such as streamlining manual processes, automating reporting and risk management, etc? This panel will discuss core areas of concern along with the technological innovation in the cleared derivatives industry and impact in the Asia-Pacific region.
Time: Jun 29, 2021 08:30 PM in Central Time (US and Canada)