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OCC March Total Volume Up 62.8 Percent from a Year Ago-Highest Volume Month Ever for U.S. Equity Options Industry
April 1, 2020--OCC, the world's largest equity derivatives clearing organization, announced today that March 2020 total cleared contract volume was 670,646,998 contracts, the U.S. equity options industry's highest month ever-up 62.8 percent from March 2019.
This exceeds the previous record of 568,899,108 cleared contracts set in February 2020. OCC's year-to-date average daily total cleared contract volume is 28,407,644 contracts.
Options: Total exchange-listed options cleared contract volume was 662,813,919 in March 2020, up 63.5 percent from 405,356,124 in March 2019. Equity options volume was 590,743,481 contracts, up 61.6 percent from March 2019. This includes ETF option cleared contract volume of 303,013,572, a 104.1 percent increase compared to 148,462,660 ETF options contracts cleared in March 2019.
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Source: OCC
Innovator Expands Category-Creating Defined Outcome ETF Suite with April Series of Nasdaq 100 and Russell 2000 Power Buffer Listings, Announces New Upside Caps for April Series of S&P 500 Buffer ETFs
April 1, 2020--New ETFs provide US Technology, and US Small Cap exposures up to a cap, with 15% downside buffers over a one-year Outcome Period
The only Buffer ETFs available based on the Nasdaq 100, and Russell 2000 Indexes
Innovator's Defined Outcome ETFs are the subject of a patent application filed with the U.S. Patent and Trademark Office
Innovator Capital Management, LLC (Innovator) announced today the April series Innovator Nasdaq-100 Power Buffer ETFTM (NAPR) and Innovator Russell 2000 Power Buffer ETFTM (KAPR) are scheduled to begin trading, expanding its category-creating Defined Outcome ETFTM suite to forty-three Buffer ETFs in total.
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Source: finance.yahoo.com
Esoterica Capital Launches Active ETF That Invests in 5G Ecosystem
March 31, 2020--Esoterica Capital has launched the first active ETF that invests in the 5G ecosystem. The Esoterica NextG Economy ETF (WUGI) began trading on Cboe on Tuesday with an expense ratio of 0.75%.
Esoterica co-founder and chairman Karan Trehan said the speed, responsiveness and capacity of 5G will transform the world’s data economy.
"We have assembled a portfolio of 35 or so companies principally in the US and Asia (China, Taiwan), that are expected to benefit disproportionately from this digital transformation," Trehan said. "The ETF is non-diversified, with high conviction holdings.”
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Source: etftrends.com
It could take three years for the US economy to recover from COVID-19
March 30, 2020--The US and Eurozone's economies could take until 2023 to recover from the impact of the COVID-19 coronavirus crisis, according to a new report from consultancy McKinsey & Company.
If the public health response, including social distancing and lockdown measures, is initially successful but fails to prevent a resurgence in the virus, the world will experience a "muted" economic recovery, says McKinsey. In this scenario, while the global economy would recover to pre-crisis levels by the third quarter of 2022, the US economy would need until the first quarter of 2023 and Europe until the third quarter of the same year.
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Source: World Economic Forum (WEF)
Active managers welcome non-transparent ETFs
March 29, 2020--A new breed of fund aims to combine investor appeal with proprietary knowhow
Since the Securities and Exchange Commission gave the green light to non-transparent active ETFs last year, several providers have applied for approval to launch them.
The new model allows managers to establish ETFs that do not disclose what is in their basket of investments, a move that challenges the status quo in the sector.
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Source: FT.com
Distressed Debt Balloons to Almost $1 Trillion, Nears 2008 Peak
March 25, 2020--Oil & gas sector leads with $161 billion of distressed debt
Investment-grade issuers such as Ford trade at deep discount
The amount of distressed debt in the U.S. has quadrupled in less than a week to nearly $1 trillion, reaching levels not seen since 2008 as the collapse of oil prices and fallout from the coronavirus shutters entire industries across the globe.
In total, the tally has ballooned to $934 billion of U.S. corporate bonds that yield at least 10 percentage points above Treasuries and loans that trade for less than 80 cents on the dollar, according to data compiled by Bloomberg. That's nearly double the amount from less than a week ago.
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Source: bloomberg.com
CFTC Issues Final Interpretive Guidance on Actual Delivery for Digital Assets
March 24, 2020--The Commodity Futures Trading Commission today announced the Commission voted unanimously to approve final interpretive guidance concerning retail commodity transactions involving certain digital assets.
Specifically, the guidance clarifies the CFTC's views regarding the "actual delivery" exception to Section 2(c)(2)(D) of the Commodity Exchange Act (CEA) in the context of digital assets that serve as a medium of exchange, colloquially known as "virtual currencies."
"Providing clarity to market participants is one of the CFTC's core values," said CFTC Chairman Heath P. Tarbert." This interpretive guidance not only fulfills that commitment, but it reflects my belief that the U.S. must be a leader in the digital asset space. These efforts are also especially critical when the hard-earned income of everyday Americans is at stake. Under my leadership, the CFTC will continue to do its part to encourage responsible fintech innovation through sound regulation."
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Source: CFTC.gov
Bond ETFs Flash Warning Signs of Growing Mismatch
March 23, 2020--ETFs of BlackRock, Vanguard and others traded at large discounts to net asset value in recent days as coronavirus roiled markets
A broad set of bond exchange-traded funds are trading out of sync with their underlying assets, testing investors' faith in a fast-growing part of the investment world.
Bond ETFs of BlackRock Inc., Vanguard Group and others traded at historic discounts to the net asset value of their underlying bonds in recent days. BlackRock's iShares iBoxx USD Investment Grade Corporate Bond ETF closed down at a discount of over 5% late last week, a record since 2008.
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Source: wsj.com
Federal Reserve issues FOMC statement
March 23, 2020--The Federal Reserve is committed to use its full range of tools to support the U.S. economy in this challenging time and thereby promote its maximum employment and price stability goals.
The Federal Open Market Committee is taking further actions to support the flow of credit to households and businesses by addressing strains in the markets for Treasury securities and agency mortgage-backed securities.
The Federal Reserve will continue to purchase Treasury securities and agency mortgage-backed securities in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions. The Committee will include purchases of agency commercial mortgage-backed securities in its agency mortgage-backed security purchases. In addition, the Open Market Desk will continue to offer large-scale overnight and term repurchase agreement operations. The Committee will continue to closely monitor market conditions, and will assess the appropriate pace of its securities purchases at future meetings.
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Source: federalreserve.gov
Junk bond ETFs are again defying doubters and liquidity fear
March 16, 2020--On a day when the whole world seemed to be jettisoning junk bonds, Geof Marshall had a plan to buy.
The idea was that, as exchange-traded funds struggled to keep up with a wave of redemptions spurred by crashing oil and coronavirus fears, he was going to swoop in and buy bonds from the ETFs on the cheap.
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Source: bloomberg.com
