Advanced/Professional volatility trading

Discussion in 'Options' started by quatron, Aug 27, 2012.

  1. FSU

    FSU

    I am a bit confused when you talk about option "dark pools," since options must trade on a listed exchange.
     
    #21     Aug 31, 2012
  2. quatron

    quatron

    Both sides of a trade are done on exchange by a broker.
     
    #22     Aug 31, 2012
  3. 1245

    1245

    They are able to cross the trade electronically on a few different exchanges. There is the possibility of being broken up on part of the trade.

    1245
     
    #23     Aug 31, 2012
  4. +1

    Entirely agreed from an IB point of view.

    A never ending "one size fits all" internal platform battle, forcing as many regions as possible onto the same poor fit global non-solution.

    The opportunity cost is a travesty.
     
    #24     Aug 31, 2012
  5. There's a big difference between ibanks and prop market makers, especially in asia.
     
    #25     Aug 31, 2012
  6. I think you'll find the hairiest knuckle dragging sales trader still out earns the best quant programmers, even in a bad year. :p
     
    #26     Aug 31, 2012
  7. quatron

    quatron

    Sure, most of them can't be bothered about PMM role. Doing some MM stuff only to collect rebates to fund index arb.

    What's the difference in your view?
     
    #27     Aug 31, 2012
  8. Most of the ibanks couldn't fulfill their PMM obligations without being arb'd to zero by prop firms with better technology.

    Banks MM for market share, to facilitate customer flow, to build a relationship with an issuer, or to bid their own warrants.

    It's not the primary business.

    How do you see it from the prop shop perspective?


    Sounds like you're in HK :p
     
    #28     Aug 31, 2012
  9. sle

    sle

    Any IBD can cross an option between customer and post to the exchange (as long as it's within NBBO), most large guys internalize option flow. Is there something different about Knight?

    Actually, maybe there is. Let me check it out, I know someone who has a reasonable clue.
     
    #29     Aug 31, 2012
  10. quatron

    quatron

    Exactly the same. When I learned how one of the biggest european banks update its quotes I was a bit shocked. They fit vol curve in Excel and send vol per strike to Orc. No wonder they would be arbed if they quoted tighter.


    I'm in Oz. But most prop shops and ibanks trade HK from Oz.
     
    #30     Sep 1, 2012