Observations & Insight
Eurex Derivatives Forum Takes a Look At German Blockchain Innovation
Thom Thompson – John Lothian News
Day One of the Eurex Derivatives Forum, held this week on Tuesday and Wednesday, offered a discussion of German developments in blockchain innovation. Germany has implemented not only detailed legislation on custody of cryptocurrencies and digital assets but has also recently adopted a law allowing electronic issuance of securities, including on blockchain.
The “Digital Securities and Tokenization” panelists seemed to agree that digital securities will find their first adoption either in new types of securities, such as carbon emission offset certificates, or bonds. Bonds, they said, are more immediately amenable to blockchain because the whole life cycle can easily be entered on the blockchain — origination, coupons and redemption.
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The stock market’s fear gauge is back at pre-pandemic lows, and it’s signaling big upside ahead, says Fundstrat’s Tom Lee
Emily Graffeo – Markets Insider
The stock market’s fear index fell to its lowest point since the start of the pandemic, in a move that could suggest further upside in markets, according to Fundstrat’s Tom Lee.
GameStop nodded to Reddit traders, the January short squeeze, and ‘Big Short’ investor Michael Burry in its annual report
Theron Mohamed – Markets Insider
GameStop’s bosses nodded to Reddit’s Wall Street Bets forum, the short squeeze its members helped engineer in January, and “The Big Short” investor Michael Burry in their annual report on Tuesday.
The video-games retailer revamped the “risk factors” section of the report after its shares skyrocketed, plummeted, then soared again this year. A new subsection outlines risks to its stock, warning that its price has been “extremely volatile” and could fluctuate widely due to factors beyond its control.
GameStop Stock Had a Bad Day. Earnings Just Made It Worse.
Connor Smith – Barron’s
GameStop ‘s fiscal fourth-quarter results came in just short of expectations, but the company announced another trio of hires with e-commerce backgrounds. The stock was down in after-hours trading.
The company reported fiscal fourth-quarter earnings of $1.34 per share, barely missing Wall Street’s consensus estimates of $1.35 a share, according to FactSet. Sales of $2.12 billion were down from $2.19 billion in 2019, and came in short of estimates for $2.21 billion.
Dow drops 308 points as rising COVID-19 cases cloud economic-recovery optimism
Carla Mozée – Markets Insider
US stocks dropped Tuesday as a rise in COVID-19 cases in Europe stoked concerns about the path for recovery in the global economy from the pandemic.
All three of Wall Street’s major indexes fell, with losses picking up pace in afternoon dealings. The S&P 500 and the Dow industrials declined for the third time in four sessions. Tech stocks as tracked on the Nasdaq Composite lost grip of earlier gains.
Bitcoin Traders Brace for Record $6B in Options to Expire Friday
Omkar Godbole – Coindesk
They call it “max pain” in the bitcoin (BTC, +0.96%) options market: How to make one’s trading counterparty suffer the most. Although the largest cryptocurrency was changing hands Wednesday around $56,500, traders were handicapping the odds of a plunge to about $44,000 by Friday, when a record $6 billion of options contracts is set to expire. A drop to that price level would inflict “max pain” on buyers of options contracts, and it might be the most profitable price point for options sellers. It’s a remote risk, but not one to be discounted.
Retail Trader Army Is Signaling Retreat on Latest Stimulus Wave
Justina Lee – Bloomberg
From bullish options to basketball trading cards, the multibillion-dollar retail frenzy is showing signs of fading. Just as $1,400 stimulus checks arrive all across the U.S., day-trader favorites are losing steam, stirring speculation that the army of individual investors who disrupted markets over the past year have opted to spend the cash on plane tickets and restaurants rather than their trading apps. Volumes in bullish options favored by members of Reddit’s WallStreetBets forum are down. Blank-check stocks are falling. Even Robinhood Markets Inc.’s ranking in Apple’s App Store has slipped below the top 100.
Exchanges and Clearing
HKEX Enhances Product Offering with Bilibili Debut
Bilibili Futures and Options to be introduced on 29 March; Bilibili shares to be included in Designated Securities Eligible for Short Selling on 29 March;Issuers can list derivative warrants on Bilibili shares on 29 March
Hong Kong Exchanges and Clearing Limited (HKEX) is pleased to announce today (Wednesday) that it will offer investors more options on Bilibili, Inc. (Bilibili, stock code: 9626) shares after its debut.
Cboe combines information solutions and market data businesses
Hayley McDowell – The Trade
Cboe Global Markets has combined its information solutions and global market data and access businesses into a single division and has promoted a senior vice president to run the combined business. Named Data and Access Solutions, the newly formed unit incorporates Cboe’s data solutions, analytics and indices with real-time and historical market data and derived data sets in equities, options, futures and FX data. The exchange said the integration was in response to the trading environment becoming more globalised, adding that the new business also unifies the sales teams to provide a single point of contact.
Trading Technologies platform goes live with Athens Stock Exchange derivatives; All Athens Stock Exchange derivatives products are now available to trade on the Trading Technologies platform including stock and index futures and options.
Annabel Smith – The Trade
Chicago-based technology provider Trading Technologies (TT) has launched trading in all derivatives products on the Athens Stock Exchange (ATHEX) via its platform.
A New Virtual Experience
The Options Industry Conference is Going Virtual in 2021. Join OCC and the options exchanges for the 39th annual Options Industry Conference, April 28-29, 2021. While the conference will be held virtually for the first time in history, the focus will continue to be the key topics facing the options industry today, from the regulatory shifts in the U.S. and Europe to the technological developments that are driving monumental change in markets around the globe.
DOJ enforcement priorities in commodities & derivatives markets: A discussion with DOJ leadership
13 April 2021 • 1:00 PM – 2:00 PM ET
During this discussion, James McDonald, Sullivan & Cromwell Partner, will interview Robert Zink, U.S. Department of Justice, Acting Assistant Attorney General (and Chief of the DOJ Fraud Section from January 2019 to August 2020), regarding DOJ’s enforcement priorities in the commodities and derivatives markets and white collar area more generally.
Top central banks identify nine ways to make their policies greener
Martin Arnold – Financial Times
The world’s biggest central banks have identified nine ways in which they could use monetary policy to tackle the risks of climate change, including greener asset purchases and climate-related lending schemes, according to a new report.
The options were outlined by the Network for Greening the Financial System, a group of 89 central banks and financial supervisors formed to support the Paris climate goals, in research published on Wednesday.
Central bankers note costs of climate action in cautious report
Central banks need to fight climate change but all policy options on the table come with costly drawbacks, so steps need to be gradual and cautious, an umbrella group of central bankers said on Wednesday, even as the ECB made a plea to act.
With climate change posing a growing risk to financial stability, central banks are examining their own role in driving a transformation. Options under study include: skewing asset purchases to benefit green issuers or punish energy intensive firms, curtailing the availability of central bank funding to polluters, or asking banks for larger collateral when they pledge polluting assets.
(Podcast) OPR 357: Once More Unto The Breach With UAL
Options Playbook – Options Insider Radio Network
On this episode, Brian is doing a rinse and repeat with United Airlines (ticker: UAL) This week it is a more sophisticated trade. He is doing a back spread with calls.