The Spread: Is 2020 Over Yet?

 

This week on The Spread: the CME launches futures trading on the VOLQ, Eurex launches futures and options trading on two ESG indices, and more.

Produced by Mike Forrester.

 

Transcript

Welcome to The Spread, I’m Matt Raebel. Things are heating up in the U.S. presidential race. After President Trump and the First Lady’s positive COVID diagnoses last week, the president reportedly underwent treatment for the virus developed by biotech company Regeneron, causing the company’s stock to skyrocket, surprising absolutely no one. Eurex had exciting news this week – the European exchange announced it will launch futures and options trading on the EURO STOXX 50 ESG and DAX 50 ESG indices starting the 9th of November. Both indices consist of companies that aren’t involved in weapons manufacturing, trading fossil fuel, selling tobacco products, or any other part of my typical Friday night. Despite the frenzy of options buying that’s been going on all year, implied volatility for FX options that expire further out than that has decreased recently, reported by the staff of Reuters, who argued that this implies the FX markets are expecting less volatility after the election…yeah, we’ll see about that. The CME launched futures trading on Nasdaq’s VOLQ, which measures the 30-day implied volatility of the Nasdaq-100 Index, on October 5th. Good timing, launching that a month before the election; that’s like selling pickaxes right before a gold rush. The CME’s bitcoin options had a flood of volume on Wednesday, trading $48 million worth of contracts that day. Why so much volume? Eh, who knows with bitcoin?…although it probably had something to do with the U.K.’s Financial Conduct Authority announcing a blanket ban on all cryptocurrency derivatives and other crypto-centric products in the United Kingdom, effective January of next year. Yeah, actually, that’s probably related. Before we say goodbye this week, I’ve got a favor to ask. As you may know, we care about preserving the history of the financial markets. That’s why John Lothian News has started a GoFundMe campaign to help us fund our MarketsWikiEducation projects – that includes MarketsWiki World of Opportunity, our Open Outcry History Project, and Path to Electronic Trading. If you feel so inclined, please go to John Lothian News dot com and click the link at the top left hand corner of the screen to make a donation so you can help us make it through the storm that has been 2020. While you’re there, you can check out the new content we’ve got up on our homepage, including coverage of the STA’s virtual conference by JLN’s Sarah Rudolph and Suzanne Cosgrove, as well as new podcasts by me and John Lothian. And that’s gonna do it for this week – I’ll talk to you next week, until then, stay safe and happy trading.

 

Sources

Trump Took Regeneron’s Covid Treatment. How to Play Its Soaring Stock With Options.
Steven M. Sears – Barron’s
https://bit.ly/2Stismq

Equity index derivatives: Introduction of futures and options on the EURO STOXX 50 ESG and DAX 50 ESG indexes; Eurex Circular 076/20 Equity index derivatives: Introduction of futures and options on the EURO STOXX 50 ESG and DAX 50 ESG indexes
Eurex
https://bit.ly/34vgSpL

FX options market reflects more confidence in Biden election win
Reuters
https://reut.rs/30INY4j

VOLQ Launches on CME
Traders Magazine
https://bit.ly/3lkv77q

Bitcoin Options Volume on CME Jumps 300% as Traders Take Bullish Bets
Omkar Godbole – Coindesk
https://bit.ly/3jKHDg4

The UK’s financial regulator bans crypto-based products for retail investors after a year-long review
Shalini Nagarajan – Markets Insider
https://bit.ly/33xL44f

John Lothian Newsletter

Today’s Newsletter

We visit more than 100 websites daily for financial news (Would YOU do that?)

Past The Spread Episodes

Tesla Trade Spurs Early-Week Stock Selling; Inflation Index Jumps; Options Volume Continues to Set Records – The Spread – November 12, 2021

Tesla Trade Spurs Early-Week Stock Selling; Inflation Index Jumps; Options Volume Continues to Set Records – The Spread – November 12, 2021

– Tesla CEO Elon Musk sells shares, briefly captivates the equity market; Higher inflation news chills Treasury trading; Options volume continues to set records;
– John’s Take profiles Stable, the winning innovator of the year at FIA Expo 2021;
– EQDerivatives’ Russell Rhoads explains the Nasdaq-100 Volatility Index in the Term of the Week.

U.S. Growth Slows, But Tesla Options Rev Up; Cboe Goes Nanos For Retail; John’s Take Previews Expo; Strategizing with Butterfly Spreads – The Spread – October 29, 2021

U.S. Growth Slows, But Tesla Options Rev Up; Cboe Goes Nanos For Retail; John’s Take Previews Expo; Strategizing with Butterfly Spreads – The Spread – October 29, 2021

– The U.S. economy sputtered to a 2% growth rate in Q3, but Tesla traders are unfazed; Cboe expands S&P 500 Index options offerings for retail with smaller options; ethereum gets a boost from new ETF expectations; 
– John’s Take previews next week’s in-person return of FIA Expo;
– Catching up with long butterfly spreads in the Term of the Week with Jermal Chandler.

Crypto Steals Headlines With Cboe-ErisX Deal, U.S. Bitcoin ETF; John’s Take Connects With ICE Mortgage Tech;  A Look at Cash-Secured Puts – The Spread – October 22, 2021

Crypto Steals Headlines With Cboe-ErisX Deal, U.S. Bitcoin ETF; John’s Take Connects With ICE Mortgage Tech; A Look at Cash-Secured Puts – The Spread – October 22, 2021

– Crypto edges into the mainstream with Cboe-ErisX acquisition announcement, first-ever bitcoin U.S. ETF debut; SEC’s GameStop study a reflection without regulation;
– John’s Take reviews the data-driven mortgage experience with ICE Mortgage Technology;
– Are you bullish on a stock? The Term of the Week looks at a cash-secured put strategy with Jermal Chandler.

Pin It on Pinterest

Share This Story