ES -- DX/CL -- isee -- cboe put/call -- specialist/public short ratio -- trinq -- trin -- aaii bull ratio -- abx -- cmbx -- cdx -- vxo p&f -- SPX volatility curve -- VIX:VXO skew -- commodity screen -- cot -- conference board

Sunday, September 21, 2008

 

effect of the end of short sale arbitrage in futures and options


via cafe americain -- one of the potential unintended consequences of the idiotic short-selling ban.

On Friday evening the December S&P futures settled 9 points lower than the S&P 500 index. Fair value is several points higher than the index close. If this discount to fair value persists DURING in the trading day on Monday, I expect we will see the market to start to go into a spiral decline....


as trader mike calls it, financial armageddon is in full effect.

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