Fintech Focus For July 19, 2021

Quote To Start The Day: “The greatest glory in living lies not in never failing, but in rising every time we fail.”

Source: Nelson Mandela

One Big Thing In Fintech: “Just recently, we hit a low in realized volatility.”

“The market has had essentially no movement and implied, or forward volatility — what people thought was going to happen — is so low such that, if you got any movement at all, it would violate what people thought was going to happen, or what was priced in.”

Lackluster trade, in the face of weak breadth, has a lot to do with the growth of derivatives.

In short, participants, yearning for yield, have propelled option volumes to levels where hedging flows, which can compress or exacerbate volatility, represent an increased share of volume in underlying stocks.

Brent Kochuba, alongside SpotGamma co-founder and CEO Matthew Fox, spoke with Benzinga about these dynamics and how their index and equity options modeling platform helps gauge market opportunity.

Source: Benzinga

Other Key Fintech Developments:

• Pomp: Investors removing bitcoin.
• Apple will squash the BNPL party.
• Unpacked: Credit card innovation.
• Serena Williams invests in fintech.
• Forecasting with Zero technology.
• BackNine exposed sensitive info.
• Blend Labs is the latest fintech IPO.
• Square eyeing BTC DeFi platform.
• Paytm looks to IPO to raise $2.2B.
• Sunlight forecasts $123M revenue.
• Morty secures $25M in a Series B.

Watch Out For This: Delta Air Lines sees business travel recovering to as much as 60% of 2019 levels by the end of September as companies reopen and people return to the office.

Source: S&P Global

Interesting Reads:

• Learning volatility arbitrage basics.
• BlackRock urging green overhauls.
• Chip shortage automaker impacts.
• Co-founder matching platform live.
• Banks eye pressure amid recovery.

Market Moving Headline: U.S. stock index futures auctioned sideways to lower.

The drop wasn’t entirely uncalled for.

Into the seasonally-aligned price rise led by the Nasdaq 100 and S&P 500, inflows decelerated and breadth weakened.

At the same time, a measure of inflation – via the Consumer Price Index (CPI) – rose the largest since the Global Financial Crisis. In response, the 5s30s curve resumed its flattening and the 10-year U.S. Treasury yield ended little changed.

Key Takeaways: Equity index futures spike lower in their attempt to discover fair prices for two-sided trade.

- COVID, waning stimulus cloud outlook.

- Ahead: Housing and employment data.

- Indices diverge; breadth, inflows lower.

In the coming sessions, participants will want to focus their attention on where the S&P 500 trades in relation to the $4,334.25 spike base.

Spike’s mark the beginning of a break from value. Spikes higher (lower) are validated by trade at or above (below) the spike base (i.e., the origin of the spike).

Source: Physik Invest