Futures Magazine April 01, 2007
Breaking News
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CME, CBOT execs defend merger
The Futures Industry Association (FIA) and major Wall Street banks have cranked up the rhetoric against the concentration of power in the new Chicago mega-exchange that would be formed if the
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All or nothing on CBOE
If the Securities and Exchange Commission (SEC) approves the rule changes requested by the Chicago Board Options Exchange (CBOE), roughly 1,330 exercise-right privileges (ERPs) held by members of the
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Push OTC energy bill
Senator Dianne Feinstein (D-Calif.) is making another run at increasing the regulation of energy derivatives trading. On Feb. 13, Feinstein re-introduced legislation aimed at preventing manipulation
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CBOT gearing up for bidding war
The Futures Industry Association’s (FIA) annual conference in Boca Raton, Fla. often is the launching pad of so-called big industry news, but usually these announcements fail to inspire. This March
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SEC unravels insider ring
On March 1, the SEC charged 14 defendants in an insider trading scheme that netted more than $15 million in illegal profits on thousands of trades, using information stolen from UBS Securities LLC
Trading Techniques
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Predators and the prey in the Dow 30
Ecosystems exhibit cyclical changes and inhabitants adapt or perish. That’s true whether you’re talking about ones populated by wild animals or financial instruments. Regardless of the venue, the
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Finding your focus in forex
Most charting services offer traders the choice of looking at charts with different time intervals. What is telling about currency charts is that many come in intervals of minutes such as one-,
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Milk futures can balance your portfolio
Portfolio managers, depending on the manager and type of investment firm, usually advise investors to allocate anywhere from 5% to 20% of their portfolios to commodities. The reason is simple:
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More about milk contracts
The CME offers five different milk-related contracts. There are two on different types of milk, two on butter, one on dry whey futures and one on a non fat dry milk contract. The most popular
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Managing risk with options
Options are the least understood and most misused financial instrument. Their value inflates and deflates many times during the day, reflecting traders’ expectations of future price moves. But
Technology & Trading
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Building your own trading system
Our first article in this trading system series discussed the pros and cons of building your own trading system versus buying one off the shelf. If you are inclined to build, here are the necessary
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Putting it all together
In trading, there is no single right answer. Many different trading concepts can make money on any market or basket of markets. The key to being a successful system trader is to take one of these
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QuoteTracker
QuoteTracker can be used to track bonds, forex, futures, options and stocks. It is a software program that integrates with many data feeds from commercial data vendors, brokers and financial sites.
Forex Trader
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Forex glimpse into Dow sell-off
The market moves of Feb. 27, when the Dow suffered its worst day in more than five years, demonstrated the reality of intermarket phenomena and the illusion of a disconnect between fundamentals and
Futures 101
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Matching forex platforms to your needs
You hear again and again that the foreign exchange market is the fastest growing and largest market in the world, and that $2 trillion changes hands through the course of each 24-hour trading day.
Industry Trends
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Do chickpeas have a future?
India’s dynamic commodity futures exchanges have become lightning rods in a volatile election year amid rising food prices, raising the specter of a complete ban on futures, even as Parliament
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Joint venture exchanges deliver the goods
A noticeable chill swept through India’s commodities world in late January when the government banned futures on two products core to the Indian diet and to all three national commodity exchanges:
Markets
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Few bright spots in dollar outlook for 2007
From a long-term perspective, the landscape for the embattled U.S. dollar appears bleak. The end of 2006 saw a short stretch of mildly optimistic economic data that provided the dollar with a decent
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Tech Talk: Enhancing carry trades
Foreign exchange traders often participate in the age-old debate between the benefits of technical analysis vs. fundamentals. Is it better to rely upon news and economic indicators, or do the charts
Book Reviews
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Commitments of Traders: Strategies for Tracking the Market and Trading Profitably
Floyd Upperman utilizes such popular indicators such as W bottoms, reversals and swing trades, usually with his own unique spin, but primarily in tandem with his main area of expertise: the
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Sectors & Styles: A New Approach to Outperforming the Market
Catalano puts forth the premise that three developments: the PC, the Internet and ETFs have made investing easier for professional and serious non-professionals, this book’s intended audience.
Market Analysis
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Fuelling the bean rally
Encroaching corn acreage and the developing viability of soybean oil based biodiesel has helped push May beans above $8 per bushel, and traders are eager to see the March 30 planting intentions
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Press pot plunge
After peaking at $1.33 per lb. in mid December, coffee turned lower and the sell-off appears to be accelerating. “We have had a great deal of producer selling,” says James Cordier, head trader at
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Down with the Dow?
Sometimes people need a reminder that markets go down as well as up. And traders won’t soon forget the day the Shanghai Stock Index tripped and fell, giving up 9% of its value, and triggered a
Managed Money
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Hedge funds weather storm
When the abrupt correction in U.S. equity markets struck on Tuesday Feb. 27 following the huge sell-off in Asia leading to a one-day 416-point drop in the Dow Jones Industrial Average, analysts
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Trading Penny-priced options
Penny-priced options, introduced October 2006, are gaining acceptance. Currently all exchanges support penny priced increments on 10 stocks and three ETFs. However, some firms, such as Interactive
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SEC wrong on rule changes
Not since the Commodity Futures Trading Commission (CFTC) innocently asked in its prelude to studying the Commitment of Traders report last year, whether the report itself was still necessary, has a
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Glass houses/conspiracy
The government lets people drive cars, buy overpriced tech stocks that fall to zero, engage in extreme sports, smoke tobacco, etc. BUT for some reason won’t allow U.S. citizens of normal financial
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Free markets for free men
It is paternalistic and immoral for government to prohibit freely entered into transactions. As such I support allowing any American to invest in any fund they choose. Net worth is not a determinant
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The rich win again
Modern Portfolio Theory posits that hedge funds and private equity investments can provide substantial benefits to a diversified portfolio. Specifically, an allocation of capital to each of these
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I am not an idiot
As an educated hedge fund investor, I am deeply alarmed, concerned and angry that your organization considers me too ignorant, uneducated, and thus, ineligible for participation in a pooled
New For Traders
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New for Traders
The Chicago Mercantile Exchange (CME) has launched the CME-Carvill Hurricane Index (CHI). The underlying indexes will be calculated by Carvill, an independent reinsurance intermediary, using publicly
People
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Farley takes Nybot reins
Carol Burke has been promoted to chief executive officer at Spectrum Global Fund Administration LLC. The former CBOT executive was previously chief administrative officer and general counsel at
News
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TT on the ropes
The patent infringement cases that Trading Technologies Inc. (TT) has brought against a slew of software vendors, brokers and customers has passed another mile marker on the way to the June trial
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Volume troubles at NYSE
Rumors have surfaced that the SEC is looking into whether the New York Stock Exchange’s (NYSE) shift toward electronic trading affected its ability to handle a surge in trading volume, such as one
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Man financial sanctioned
Six customers of Man Financial Inc. will receive $196,900 in restitution ordered by the CFTC, which also ordered the giant futures commission merchant (FCM) to strengthen its supervisory system for
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International News
The New York Mercantile Exchange (Nymex) is jumping into the global consolidation craze by purchasing a 10% stake in the Montreal Exchange (MX). Through a joint venture agreement, the exchanges also
Trader Profiles
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Scully: Long volatility short risk
Richard Scully first became interested in commodities trading growing up on his family’s corn and soybean farm in Central Illinois. That experience is what led him to take a position at Paine
