The rise of 0DTE (zero day to maturity options) is a recent phenomenon. Option volume has really taken off during Q4 2022 and has deeply impacted market behavior and structure. For the ones not really fully acquainted with the matter, May 2022 is the month where it all started....
SGG believes that the market structure is an important behavior factor. Technology and computing power are definitively important drivers. The Investment management industry has been highly commoditized and the rise of passive investment is a result. When I say "Commoditized" it means that financial products suppliers profit margins have shrunk...
The aftermath of the COVID crisis and the ongoing Ukraine conflict has been a surge in inflation to level not seen in a long time. From globalization and fear of deflation to friend-shoring and fear of inflation. Looking back at the last 40 years, summer 1982 marked the start of...
Back in July 2021 and May 2021, I wrote : "I believe that COVID 19 has unleashed the full power of the BTFD mind set. It is so powerful that it could become an unprecedent FOMO (Fear of Missing Out) wave. A race which could push indices with relative...
In the analytical process of my portfolio approach I highlight these five interconnected points. To simplify! In a strong trend, each tends to confirm the behavior of the other. Ex: strong bull trend will show a great majority of stock trending higher (homogeneity & breadth), Credit spreads compressing, general optimism,...
Just a few ones.... I have focused quite a bit on the US equity market in previous posts, since it has been the lone World leader since 2008. It remains the leader, in relative terms. The US equity mkt has been the excess liquidity recipient. However, the derivatives mkt is...
Market structure is an important driver of the price action. We all agree that excess liquidity is an important item but we need to understand better its impacts. I deeply believe that we are in a derivative bubble where cash price action has mainly become a derivative of the...
I have highlighted in previous posts that since 2008, the sole game in town has been the US stock market and in particular the Nasdaq 100 index. We can observe many distortions and one of them is that cash market actions has become somehow the derivative of the derivatives...
