Archive November 2018

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Week InReview: November 30, 2018

Sponsored research

"New securities-trading rules are having one pernicious side effect on European stock markets: Research is increasingly paid for by those being researched.

"So-called sponsored research has long been common in the bond market, where ratings firms are paid by firms to grade their credit risk. The European Union's catchily-named second Market in Financial Instruments Directive, or MiFID II, is helping extend the problem to equities."

The Dangerous Rise of Sponsored Stock Research

- The Wall Street Journal

Week InAdvance: November 26, 2018

Mon Nov 26 G20 summit in Argentina. Basel Committee in UAE. | Tue Nov 27 IOSCO in Madrid. | Wed Nov 28 The Year Ahead summit in NYC. | Thu Nov 29 FOMC minutes. | Fri Nov 30 G30 plenary in NYC.

Week InReview: November 23, 2018

The poker aces playing a key hand in the $5 trillion ETF market On City Avenue in the Philadelphia suburb of Bala Cynwyd, Pennsylvania, across the street from a TGI Fridays and California Pizza Kitchen, sits a bland building that looks like any other corporate office. And yet within that dull gray-brown edifice, away from the trading hubs of New York and Chicago, sits a crucial engine of the $5 trillion global exchange-traded fund market. (Bloomberg Markets | Nov 20)... and more!

Week InReview: November 16, 2018

Markets danger zone: 5 things investors need to watch As financial markets enter a more challenging phase, investors and analysts are looking for signs that can indicate financial stress. Here are some of the main contenders (Financial Times | Nov 15)... and more!

Week InAdvance: November 12, 2018

Mon Nov 12 Global Future Councils in Dubai. | Tue Nov 13 ASEAN summit in Singapore. | Wed Nov 14 Fed testifies in House. | Thu Nov 15 SEC proxy voting roundtable. Fed testifies in Senate.

Week InReview: November 9, 2018

`Fed Is in Denial': How a $4 Trillion Dilemma Could Get Ugly Fixed-income traders are telling the Federal Reserve that it might end up making a big policy mistake. And it's not just rising interest rates they're talking about. Wall Street sees risk of reserves growing scarce on Fed unwind; demand for short-term cash could wreak havoc on rate policy. (Bloomberg Markets | Nov 8)... and more!

Week InAdvance: November 5, 2018

Mon Nov 5 CFTC considers swap-related rules. | Tue Nov 6 New Economy Forum in Singapore. | Wed Nov 7 SEC panel meets on Regulation Best Interest. | Thu Nov 8 FOMC rate decision. | Fri Nov 9 FinReg event at Brookings.

Week InReview: November 2, 2018


Among the Laws of Insider Trading, two have special places in my heart. One is the Second Law, which is that if you have inside information about a company, don't use it to buy short-dated out-of-the-money options on that company. This one is so important, and comes up so often, because that's how they catch you: Suspicious options trades the day before a big event are a giant red flag, and if you've never traded options before it can be a bit hard to explain why you suddenly got a hankering to do it right before a merger.

The other is the Fifth Law, which is that you should not insider trade by planting bombs at a company and buying put options on its stock. This one comes up infrequently, and is arguably not a law of insider trading at all, but it is nonetheless very important, because bombs are bad. Like, insider trading and stock manipulation are generally illegal and you shouldn't do them and if you do you might get in trouble. But if you just go around blowing things up with bombs you will get in much worse trouble.

That is: Violating the Second Law greatly increases the chances that you'll get caught, and violating the Fifth Law greatly increases the chances that, if you do get caught, you'll go to prison for a very long time.

Matt Levine's Money Stuff