Jpmorgan Paying $100m, Admitting Manipulation Of Prices In Settlement Over $6b Trading Loss

Should the contract expire worthless, the premium would represent a 4.06% return on the cash commitment, or 7.03% annualized at Stock Options Channel we call this the YieldBoost. Click here to find out the Top YieldBoost Puts of the MLPs Below is a chart showing the trailing twelve month trading history for Atlas Pipeline Partners LP, and highlighting in green where the $32.00 strike is located relative to that history: Turning to the calls side of the option chain, the call contract at the $38.00 strike price has a current bid of $1.50. If an investor was to purchase shares of APL stock at the current price level of $37.40/share, and then sell-to-open that call contract as a covered call, they are committing to sell the stock at $38.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 5.61% if the stock gets called away at the May 2014 expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if APL shares really soar, which is why looking at the trailing twelve month trading history for Atlas Pipeline Partners LP, as well as studying the business fundamentals becomes important. Below is a chart showing APLs trailing twelve month trading history, with the $38.00 strike highlighted in red: Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected.
Source: http://www.forbes.com/sites/stockoptionschannel/2013/10/18/first-week-of-may-2014-options-trading-for-atlas-pipeline-partners-apl/

(Photo: Richard Drew, AP) Story Highlights First enforcement action under SEC’s market access rule On Aug. read this 1, 2012, Knight Capital sent more than 4M erroneous orders arising out of computer glitch The orders covered 140 stocks listed in the New York Stock Exchange SHARE 1 CONNECT 9 TWEET COMMENTEMAILMORE Financial firm the Knight Capital Group, which merged with Getco in the wake of a 2012 stock trading glitch, has agreed to pay a $12 million fine from the Securities and Exchange Commission. It marks the SEC’s first enforcement action under its market access rule, adopted in 2010. On Aug.
Source: http://www.usatoday.com/story/money/business/2013/10/16/knight-capital-sec-12-million-fine/2993661/

The trading loss raised concern about continued risk-taking by Wall Street banks five years after the financial crisis plunged the country into the worst recession since the Great Depression of the 1930s. The fallout ensnared JPMorgan CEO Jamie Dimon, who initially dismissed news reports of the huge bets by the London operation as a tempest in a teapot. He later acknowledged the magnitude of the losses, admitted to Congress that the bank failed in its oversight and took a multi-million-dollar pay cut. Federal prosecutors in New York filed criminal charges in August against JPMorgan traders Javier Martin-Artajo and Julien Grout. Martin-Artajo supervised the banks trading strategy in London, and Grout, his subordinate, was in charge of recording the value of the investments each day.
Source: http://www.washingtonpost.com/business/jpmorgan-paying-100m-admitting-manipulation-of-prices-in-settlement-over-6b-trading-loss/2013/10/16/a23cc220-366e-11e3-89db-8002ba99b894_story.html

NextWorth : $180. It’s also accommodating on the tablet’s condition. Best Buy : This one’s a bit tricky, because “good” is the best listed condition. But if it’s “fair,” you only get $130.
Source: http://money.cnn.com/2013/10/20/technology/mobile/ipad-trade-in/index.html

The Goldman Sachs Trading Machine Broke Down In The Summer

The bank said the drop reflected significantly lower net revenues in mortgages and interest rate products, as well as in currencies. Wall Street had been well prepared for a drop off, especially after other big banks like Citigroup reported in recent days weakness in third-quarter fixed income trading revenue, but Goldmans trading slowdown was sharper than expected and more severe than at other big banks. Fixed Income, Currency and Commodities Client Execution operated in a challenging environment, which was characterized by economic uncertainty, difficult market-making conditions in certain businesses and lower levels of activity, Goldman Sachs said in the third-quarter earnings release it put out on Thursday. In other words, Goldman was thrown off its trading game as the Federal Reserve threw its summer head fake about diminishing its massive bond buying program. Goldman was unable to offset the trading decline in other areas like investment banking.
Source: http://www.forbes.com/sites/nathanvardi/2013/10/17/the-goldman-sachs-trading-machine-broke-down-in-the-summer/

RPT-U.S. data backlog a boon for computer-driven trading

4. As well as data on the world’s biggest economy, European and Asian numbers during the week may cause sharp swings in stock, bond and currency prices as investors parse the figures. That will benefit high-frequency, or “algo”, traders, whose algorithms rapidly pump out a large number of small computerised orders to exploit price moves. “There may be some surprises as the market catches up to the data. This implies heightened volatility, which is good for many systematic strategies,” said Aaron Smith, managing director at hedge fund Pecora Capital, which specialises in such trading. “Our reaction during October was to dramatically reduce exposure to our momentum systems as price action was compressed and the market adopted a ‘wait and see’ attitude.” Also known as momentum trading, such computerised dealings at high speed can inject further choppiness into markets, which in turn helps high-frequency accounts generate profits.
Source: http://www.reuters.com/article/2013/10/20/fiscal-usa-data-markets-idUSL6N0I82UO20131020

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s