​Mid-Week Roundup – Levered ETFs In Focus; Autocalls Lose Luster

CBOE floor brokers are reporting a quiet S&P 500 pit today, following Tuesday’s trading volume of 595,550 contracts. “The market is not moving after a huge draw down and bounce,” a Chicago trader told EQD. Today’s Federal holiday may also be playing its part on the subdued volumes. We also take a closer look at levered and inverse volatility ETFs this week, which are not tracking their underlyings adequately enough, according to market participants. The ETFs could see greater losses if another market decline occurs this year. Meanwhile, structurers have their eye on rates-based structured products should the Fed raise rates this December, an outcome which is more likely following the recent positive employment data. This could spell trouble for autocallable structures, which have come into vogue this year due to the low rates environment. On a final note, we’d like to thank all current and former service men and women. Veterans Day, or Remembrance Day in the Commonwealth of Nations and other countries, is a day to reflect on those that have sacrificed their lives for the protection of our way of life and values and a good time to reflect on our own contribution to society in comparison. So, to veterans everywhere, thank you.