May 2, 2005

 

Lead Stories

 

Montreal Exchange bemoans shortage of derivatives proficiency among brokers

TORONTO (CP) - If you don't buy and sell equity options - or understand them - it's probably at least partly because your stockbroker doesn't understand them either, Montreal Exchange executives said this week.  One of the main challenges the MX faces is a lack of brokerage expertise in the area of derivatives, chief executive officer Luc Bertrand and chairman Jean Turmel said during a get-acquainted session with the Toronto business press.

http://www.cbc.ca/cp/business/050501/b050112.html

 

***** Will someone please recommend this newsletter to them?

 

Two Plus Two Equals What?

In Merger Math, Change for Investors Is the X Factor

Peggy and William Schmeltz haven't stayed up nights pondering the larger meaning of the New York Stock Exchange's decision to merge with electronic trader Archipelago Holdings Inc., or the Nasdaq Stock Market's plan to buy online trader Instinet Group Inc.

http://www.washingtonpost.com/wp-dyn/content/article/2005/04/30/AR2005043000187.html

 

Eurex Turnover up 21 Percent Year-On-Year

104 million contracts changed hands on the world’s largest derivatives market in April/ Year to date turnover rises to new record of 416 million contracts

http://www.eurexchange.com/about/company_info/press_releases/news_pressreleases_408.html

 

Equities Turnover in April 7 Percent up Year-On-Year

€281 billion in turnover on German stock exchanges in April/More transactions on Xetra

http://deutsche-boerse.com/dbag/dispatch/en/listcontent/gdb_navigation/press/10_Latest_Press_Releases/Content_Files/13_press/pm_news_020505_umsatzkassa.htm

 

Buffett against NYSE plan to go public 

NEBRASKA, MAY 1:  The New York Stock Exchange’s (NYSE) plan to go public would hurt investors by creating an incentive for big board officials to encourage unnecessary trading, Berkshire Hathaway Inc chairman Warren Buffett said. 

http://www.financialexpress.com/fe_full_story.php?content_id=89672

 

CME Reports Record Average Daily Volume of 4.9 Million Contracts in April, Up 47 Percent from Year-Ago Period; Monthly

http://biz.yahoo.com/prnews/050502/cgm044.html?.v=7

 

CBOT April volume up 14 percent from year ago

CHICAGO, May 2 (Reuters) - Derivatives trading volume at the Chicago Board of Trade slowed in April from March's record high, but was still up 14 percent from a year ago, exchange data showed on Monday.

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh27926_2005-05-02_15-45-11_n02459549_newsml

 

Goldman Had Conflicts? O.K., What's the Problem?

Goldman Had Conflicts? O.K., What's the Problem? A LOT of ink has been spilled in recent days on the role that Goldman Sachs played in the New York Stock Exchange's planned acquisition of Archipelago Holdings.

http://www.nytimes.com/2005/05/01/business/yourmoney/01dealbook.html

 

Use of same adviser by both NYSE, Archipelago defended

NEW YORK -- New York Stock Exchange Chief Executive John Thain has defended the choice of Goldman Sachs, his former employer, as an adviser to both sides of the Big Board's merger with Archipelago Holdings, saying the firm merely brought the two sides together and did not negotiate any financial details of the deal.

http://www.suntimes.com/output/business/cst-fin-arch02.html

 

Deutsche Börse in proxy vote dispute

Questions were raised last night about the validity of a vote that could decide the future of Rolf Breuer, chairman of Deutsche Börse, after it emerged that some shareholders had been sent proxy voting forms for the May annual meeting that omit the crucial 10th proposal to sack him.

http://news.ft.com/cms/s/da0b9fd4-baa6-11d9-a27b-00000e2511c8.html

 

Deutsche Börse: Form of Proxy is Correct

http://deutsche-boerse.com/dbag/dispatch/en/listcontent/gdb_navigation/press/10_Latest_Press_Releases/Content_Files/13_press/pm_news_proxyform_020505.htm

 

Deutsche Boerse rejects Financial Times story on incorrect proxy voting forms

FRANKFURT (AFX) - Deutsche Boerse AG has rejected a Financial Times story stating that it issued incorrect proxy voting forms for its upcoming annual general meeting which omit a crucial proposal to sack supervisory board chairman Rolf Breuer.

http://www.iii.co.uk/news/?type=afxnews&articleid=5283524&subject=companies&action=article

 

Euronext, Borsa Italiana to jointly bid for MTS exchange - report

MILAN (AFX) - Euronext NV and Borsa Italiana SpA tomorrow will present a joint bid for MTS, owner of the EuroMTS government bond trading platform, the daily Il Sole 24 Ore said yesterday without giving a source. The two companies will set up a 50:50 joint venture to carry out the purchase, it said.

http://www.iii.co.uk/news/?type=afxnews&articleid=5283374&subject=companies&action=article

 

Sugar futures come under FMC lens — Sustained selling pressure sets off alarm bells

FUTURES trading in sugar at the National Commodity & Derivatives Exchange Ltd (NCDEX) is coming under the scanner yet again.  If in December and early January, it was the allegedly speculative rise in prices that forced the Forward Markets Commission's (FMC) intervention, this time round it is sustained selling pressure, which is said to have triggered off alarm bells in official quarters.

http://www.thehindubusinessline.com/2005/05/02/stories/2005050201880100.htm

 

Investing in firms that make markets work tricky business

NYSE-Archipelago deal and other moves offer opportunities and pitfalls for investors, experts say.

http://www.timesleader.com/mld/timesleader/business/11541610.htm

 

'03 Innovation Award winner proves vision pays off

In 1997, Jerry Putnam was telling anyone who'd listen -- and there weren't many -- that his new company was in the vanguard of innovation in the securities industry.

http://www.suntimes.com/output/business/cst-fin-innovate02.html

 

Will NYSE deal end its self-policing?

The New York Stock Exchange's plan to acquire an electronic trading system has caused a firestorm over the value of the deal, the advisers on the deal, and what the deal will mean to the future of its trading floor.  It has also called into question the future of self- regulation - the system under which exchanges regulate their markets and the conduct of their members.

http://www.madison.com/wsj/home/biz/index.php?ntid=38220&ntpid=3

 

Environmental Trading News

 

New Forestry Pioneer to Receive $250,000 Heinz Award for the Environment

Dr. Jerry Franklin Honored for Transforming Forest Management to Better Preserve America's ``Old-Growth'' Forests

BOSTON--(BUSINESS WIRE)--May 2, 2005--E-Wire--A Seattle-based forest ecologist and progenitor of a new paradigm for protecting America's old-growth forests has been selected to receive the 11th annual Heinz Award for the Environment, one of the largest individual achievement prizes in the world.  Dr. Jerry Forest Franklin, dubbed the "father of new forestry" whose one-time unconventional views on forest management eventually became established practice, is among five distinguished Americans selected to receive the $250,000 awards, presented in five categories by the Heinz Family Foundation.

http://biz.yahoo.com/bw/050502/25784.html?.v=1

 

Exchange News

 

BOT launching South American soybean futures

CHICAGO — On May 20, the Chicago Board of Trade will launch its first international physical delivery agriculture contract – CBOT South American Soybean futures.

“This product was requested by our global customers because they needed a more efficient hedging tool,” said Rich Jelinek, with the CBOT at last week’s industry meeting. “The CBOT has been the benchmark for soybean prices since 1936 and this contract is not replacing anything, it is supplementing our existing soybean contracts.”

http://www.agrinewspubs.com/Main.asp?SectionID=1&SubSectionID=207&ArticleID=8462

 

January 2005 CME Brazilian Real Futures & Options To Terminate on Thursday, December 30

http://www.cme.com/clearing/clr/clradv/11149.html

 

Seven New Listings Join the NYSE in Week Ended April 29

http://www.nyse.com/press/1114771260499.html

 

NYSE Seat Sells for $2,500,000

http://www.nyse.com/press/1114771259721.html

 

NYSE Seat Sells for $2,600,000

http://www.nyse.com/press/1114771258434.html

 

NYSE seat: one hot commodity

NEW YORK (Reuters) - A seat on the New York Stock Exchange sold for $2.6 million Friday, up $200,000 from the previous sale, as the Big Board's seat prices have shot higher since it announced plans to merge with electronic trading exchange Archipelago Holdings .

http://money.cnn.com/rssclick/2005/04/29/markets/nyse_seat.reut/index.htm?section=money_latest

 

BEL20® index - new divisors

http://www.euronext.com/news/press_releases/0,4159,1732_8275,00.html

 

Boston Options Exchange to Launch Trading of iShares Russell 2000 Index

http://www.bostonoptions.com/pdf/PressReleaseRussellIndexApril05.pdf

 

Board Report

http://www.tse.or.jp/english/guide/b_report/index.html

 

PHLX to Begin Trading Eight New Options

http://www.phlx.com/news/pr2005/05pr042905.htm

 

OMX Exchanges Monthly Statistics April 2005

http://www.exchange-handbook.co.uk/news_story.cfm?id=52681

 

ASX Trading Statistics - April 2005

http://www.exchange-handbook.co.uk/news_story.cfm?id=52673

 

Regulatory News

 

The SEC News Digest

The SEC News Digest provides daily information on recent Commission actions, including enforcement proceedings, rule filings, policy statements, and upcoming Commission meetings.

http://www.sec.gov/news/digest/dig042905.txt

 

CFTC Releases Staff Research Report Re: Energy Complex

http://www.cftc.gov/opa/press05/opa5074-05.htm

 

Waddell & Reed, Inc. Agrees to Pay $5 Million Fine, up to $11 Million in Restitution to Settle NASD Charges

Relating to Variable Annuity Switching

http://www.nasd.com/web/idcplg?IdcService=SS_GET_PAGE&nodeId=5&ssSourceNodeId=5

 

Customers due millions from broker

Dispute involves variable annuities

Waddell & Reed Financial Inc. agreed Friday to pay $32.5 million to end regulatory and courtroom disputes triggered by thousands of variable annuity exchanges.

http://www.kansascity.com/mld/kansascity/business/11527854.htm

 

Fee Rate Advisory #1 for Fiscal Year 2006

http://www.sec.gov/news/press/2005-69.htm

 

Foreign content change will make investments more attractive to institutions, individuals: report

No “big bang” effects, but benefits will be long-term, MFC Global says

http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=28602&IdSection=137&cat=137

 

Larkspur heiress off hook for broker's legal bills

An NASD arbitration panel last November ruled that a negligence complaint brought by Susan Hollern against her wealthy father's stockbroker was groundless.

http://www.insidedenver.com/drmn/business/article/0,1299,DRMN_4_3741521,00.html

 

Managed Futures - Managed Funds

 

Gabelli's Pay Seems Obscene But Look Again

NEW YORK (Reuters) - When a chief executive officer gets paid $55 million, or more than a fifth of a company's annual revenue, one might think activist investors and corporate governance gurus would be after his blood.  Yet it's hard to find outrage over the salary of Mario Gabelli, a well-known money manager whose compensation made public this week easily topped that of CEOs overseeing tens of thousands of employees and commanding billions in earnings.

http://news.reuters.com/newsArticle.jhtml;jsessionid=PALLEGBVPJHVCCRBAELCFFA?type=reutersEdge&storyID=8353810

 

Niederhoffer reopens funds, adds personnel

Apr-29-2005 - RG Niederhoffer Capital Management will reopen its flagship Roy Niederhoffer Ireland #1 and #2 Fund and the Roy Niederhoffer Global Fund on May 1

http://www.marhedge.com/news/Cover.MAR.asp?s=MARH-2005-04-28-10-02-55p1.htm

 

Schindler Trading Performance as of April 30, 2005

http://www.schindlertrading.com/index.php?page=performance

 

Reports

 

Bond Talk Today's Events

http://www.bondtalk.com/global.cfm?S=todaysevents

 

USDA Today

http://www.usda.gov/nass/PUBS/TODAYRPT/TODAY.HTM

 

Miscellaneous News

 

ABN AMRO offers innovative forex model

Apr-29-2005 - ABN AMRO launched a foreign exchange model on April 21 that indicates whether the EUR-USD exchange rate is likely to trend higher or lower, or instead be subject to movements within a trading range.

http://www.marhedge.com/news/Cover.MAR.asp?s=MARH-2005-04-28-10-04-47p1.htm

 

Morgan Stanley Board of Directors Reaffirms Commitment to Management; Initiates Governance Changes

http://www.morganstanley.com/cgi-bin/morganstanley.com/pressroom.cgi?action=load&uid=405

 

Disgraced Sydney broker takes life

High-profile Australian stockbroker Rene Rivkin has committed suicide following a spectacular fall from grace which saw the flamboyant trader jailed after being convicted of insider trading.

http://www.cnn.com/rssclick/2005/BUSINESS/05/01/rivkin.suicide/index.html?section=cnn_latest

 

Australian Bourse Reacts to News of Rene Rivkin's Death

SYDNEY, May 2 Asia Pulse - In his heyday Rene Rivkin was the face of Australian Stock Exchange and inspired awe in junior traders and competitors alike.

http://asia.news.yahoo.com/050502/4/20b9i.html

 

Keep Up With Streaming Data By Seth Grimes

A new class of streaming data software, responding to what may soon be a common demand, is melding deep analytics with the ability to crunch torrents of data in real time. Analyzing continuous, high-volume data feeds poses a special challenge for applications as varied as automated financial-market trading, security-incident detection and weather forecasting. These applications all use analytically discovered patterns to generate predictions, yet the value of these predictions is degraded by long processing times.

http://news.yahoo.com/news?tmpl=story&u=/cmp/20050502/tc_cmp/159907832

 

Onward corporate soldiers, say religious activists

ST. LOUIS (Reuters) - Armed with the power of faith and billions of dollars, America's mighty religious establishment is trying to reform the country's boardrooms on issues from human rights to television violence.  Faith-based groups, like other special interest groups, have strategic investments in hundreds of companies that let them use shareholder resolutions to push their agendas.

http://news.reuters.com/newsArticle.jhtml?type=topNews&storyID=8360901

 

Business Inaction Could Lead to Cybersecurity Law

WASHINGTON (Reuters) - U.S. businesses for years have urged the government to let them set computer-security standards of their own, but their inability to do so could now prompt Congress to step in, experts say.  Those who worry that regulation may stifle innovation say the business community may have already missed an opportunity to prove the government's help is not needed.

http://news.reuters.com/newsArticle.jhtml?type=topNews&storyID=8354653

 

LaBranche stock plunges to record low 

NEW YORK, April 29 (Reuters) - LaBranche and Co. Inc., the largest market-maker on the New York Stock Exchange trading floor

http://news.reuters.com/newsArticle.jhtml?type=topNews&storyID=8350734

 

Chicago CEOs in the money with options

Adding up fortunes created by options-based pay; the big — and not so big — names netting the most

http://chicagobusiness.com/cgi-bin/news.pl?id=16341

 

E*TRADE FINANCIAL Delivers Equity Edge 6 to Help Companies Meet Demanding Regulatory and Compliance Challenges

http://www.newswire.ca/en/releases/archive/May2005/02/c2984.html

 

Bookstore Red Tag Sale - Prices as low as $2.99! 

http://www.invest-store.com/oic/tl050105.html

 

Merrill sued over decimated $1m

Merrill Lynch Equities is being sued for more than $1 million by an investor who crossed over to the broking house from The House of Sachs.

http://www.theage.com.au/news/Christopher-Webb/Merrill-sued-over-decimated-1m/2005/05/02/1114886312147.html

 

£20m: the sum that Barclays paid to each of two high-flying executives - the equivalent of 500 bank managers

Two investment bankers at Barclays earned more than £20 million each last year, The Telegraph can reveal.

http://news.telegraph.co.uk/news/main.jhtml?xml=/news/2005/05/01/nbarc01.xml

 

Easyscreen board pushes for Refco offer acceptance as cash start to run out

LONDON (AFX) - Easyscreen PLC pushed its shareholders to accept the offer it is recommending from Refco Trading Services (UK) Ltd, a subsidiary of Refco Group Ltd, as it said existing cash resources are expected to run out during August 2005. Easyscreen said turnover for the fourth quarter to end-March was 9 pct lower than for the quarter ended Dec 31 2004. Turnover year on year was up 4 pct.

http://www.iii.co.uk/news/?type=afxnews&articleid=5282992&action=article

 

On the Record: Charles Schwab

Charles Schwab is one of those rare cases in business in which the name of a company and that of its founder are inseparable. It's impossible to think of the nation's largest discount brokerage firm without conjuring the image of Charles Schwab the person --...

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2005/05/01/BUschwab01.DTL&feed=rss.business

 

The genesis of discount brokerage / 1975 SEC deregulation offered an opening; Schwab stepped in

Thirty years ago today, Wall Street rumbled, and Charles R. "Chuck" Schwab became one of the first to embrace new trading rules that opened the way to discount brokerage, putting him on a path that would eventually make him a household name. The new...

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2005/05/01/BUGT6CI0BI1.DTL&feed=rss.business

 

Investment brokers vs. investment advisers: Know the difference

True or false: Financial planner, financial consultant, investment adviser, stockbroker -- these are all titles for people who provide essentially the same types of services, right? True. So there's no need to concern yourself about how they differ from one another, right? False.

http://www.bankrate.com/brm/news/BoomerBucks/20050427a1.asp

 

The Bank of New York Expands Derivatives Collateral Management Offerings

The Bank of New York, a global leader in securities servicing, is expanding its derivatives collateral management product offerings and, as part of these plans, has appointed Scott Linden as product manager of the Broker Dealer Services Division.

http://biz.yahoo.com/bw/050502/25639.html?.v=1

 

AIG Adds Derivatives Blunder to Error Count

The insurer says it was undervaluing its portfolio by $2.4 billion.

http://www.thestreet.com/_tscrss/markets/matthewgoldstein/10221077.html

 

Changes at Morgan Stanley Won't Include Ouster at Top

http://www.nytimes.com/2005/05/02/business/02morgan.html

 

John's Comments

 

CTA – John J. Lothian & Company March 2005 Performance Update

 

I am a month behind in my reporting of performance for the two trading programs John J. Lothian & Company offers.  In March, Big ED returned +.72% and Maple Sugar showed a decline of -6.91%.  For the year of 2005, Big ED is up 4.40% and Maple Sugar is down -8.61%.  For life of program, Big ED is down -4.46% and Maple Sugar is up +12.34%.  April performance will be forthcoming.

 

I am also pleased to report that Big ED has received a small allocation from the fund that allocated to Maple Sugar at the beginning of April.

 

Conference – Options Industry Conference

 

I will be attending the 23rd Annual Options Industry Conference at the Hyatt Regency Coconut Point Resort & Spa in Bonita Springs, Florida, from May 12-14, 2005.  I have secured a surprise guest editor to write the newsletter in my absence.  It will be a familiar name to those of you who have read this newsletter for some time.  More details to follow.

 

Washington, DC

 

I will travel to Washington, DC on May 19 and will also be out of the office on May 20.  The newsletter will have the same surprise guest editor during my Washington trip as my Florida trip. 

 

 

*********

 

Erivativesreview.com APRIL 2005

http://www.erivativesreview.com/

 

EDITORIAL -  Seamless Logic?

http://www.erivativesreview.com/content/content.cfm?ID=7BDE2D3D-03CD-4282-A2AE1961188F5E79&SectionID=B779E4D0-0880-4AAE-888ACEE3A271D05F&IssueID=51B659F0-4B4C-4294-B5C13408734BD04B

 

FEATURES -  A Grand Old Exchange Rejuvenated?

http://www.erivativesreview.com/content/content.cfm?ID=7BD96123-170B-4807-961DDA02FE10B43E&SectionID=3B72CBAB-E80F-47D1-B444008C2A2CEB4B&IssueID=51B659F0-4B4C-4294-B5C13408734BD04B

 

NEWS REVIEW -  Erivativesreview April News

http://www.erivativesreview.com/content/content.cfm?ID=937606F3-42C2-48B5-8C6F80FBD8C30B2B&SectionID=7E13A972-D318-4532-BDB4F234FAE59431&IssueID=51B659F0-4B4C-4294-B5C13408734BD04B

 

*********

 

You Just Trade News

 

You Just Trade Announces Appointment of Joe Bigane as Business Development Leader

http://www.strategicsinc.com/content/press/You/2005/05.02.05_YJTBusLeader.doc

 

**********

 

Brent Crude Watch

 

IPE Brent Volume: 75,577

NYMEX Brent Crude Volume: 3409

NYMEX Percent of Total Volume: 4.32%

 

********

 

Chicago Electronic Trading Scorecard for April 29, 2005

 

Percent Electronic

 

CBOT: 68.10%

CME: 79.73%

CME Eurodollars: 85.13%

CME Live Cattle: 1.79%

CME Currency Products: 74.42%

CBOT Soybeans: 2.19%

 

CBOT Options: 8.03%

CME Options: 4.77%

 

Volume 

 

OneChicago Volume: 1930

Eurex US Volume: 5865

Euronext.liffe Eurodollar Volume: 28,194

CBOE Futures Exchange Volume: 1741

 

Market Share

 

CBOT 100 oz. Gold Volume: 1551

NYMEX 100 oz. Gold Volume: 48,147

CBOT Share: 3.12%

 

CBOT 5000 oz. Silver Volume: 376

NYMEX 5000 oz. Silver Volume: 35,114

CBOT Share: 1.06%

 

CBOT Mini Gold Volume: 1329

CBOT Mini Silver Volume: 792

 

CME Emini Russell 1000 (100X) Volume: 4238

Eurex US Mini Russell 1000 (100X) Volume: 1262

NYBOT Mini Russell 1000 (50X) Volume: 1863

CFE Mini Russell 1000 (100X) Volume: 0

 

CME Emini Russell 2000 Volume: 162,807

Eurex US Mini Russell 2000 Volume: 3049

CFE Mini Russell 2000 Volume: 1208

 

Notes:  

 

Liffe Eurodollar Over-Under

 

Liffe/Globex: 1.81%

Liffe/CME: 1.55%

 

Regards,

 

John J. Lothian

Publisher

John Lothian Newsletter 

www.johnlothiannewsletter.com

 

Futures Brokerage - Business Intelligence   John J. Lothian President- Electronic Trading Division The Price Futures Group, Inc. 141 West Jackson Blvd., Suite 1340A Chicago, IL 60604 jlothian@pricegroup.com johnlothian@johnlothian.com IM: LothianJohnJ http://www.pricegroupetd.com tel: tel2: fax: mobile: +1 312-264-4350 +1 800-713-0215 +1 312-264-4399 +1 312-203-5515

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Disclaimer: The John Lothian Newsletter is a product of John J. Lothian & Company, Inc.  The opinions expressed are strictly the opinion of John Lothian, and not necessarily those of his employer, The Price Group and its management, and is intended solely for informative purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed.  No guarantee of any kind is implied or possible where projections of future conditions are attempted.  Security futures are not suitable for all customers.

 

Futures and options trading involve risk.  Past results are no indication of future performance.

 

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