From Goldman Sachs to Bright Trading: "We are pleased to announce that Goldman Sachs has entered into an agreement with Charles Schwab & Co. Inc. in which Schwab will route and execute its retail options orders via OptEx Services LLC, the newly-established Goldman Sachs affiliate specializing in options routing and execution. The formation of OptEx, in conjunction with SLK-Hull Derivatives LLC, is the next logical step in the development of our equities trading platform. This move advances our technology-driven approach to providing investor clients with consistently superior execution and remaining at the center of market flows and price discovery. OptEx will access liquidity from a number of specialist firms, including our own." You can see more at: http://eqweb.eq.gs.com:81/ Comment: There is a lot of consolidating going in our our trading community, and it is imperative to success that we stay abreast of the changes. We are fortunate to be part of the GS family, so we can enjoy the inside route...but it is equally as important for all traders to understand what is going on. Don
They have still got to hedge their option positions so may still have to use the exchange to do this.
Unless they are gamma scalping insted of trading being delta neutral pairs. How would they hedge this order flow?
Since Hull trading is involved, a major player on the ISE, as well as a major player in most trading pits worldwide, I don't think hedging is a problem. I've know Blair Hull since the 1970's and he (and his firm) are the best in the world at what they do. IMHO... Don
Are any of you guys trading options via a broker? I'm just curious if they (the brokers) have made this information available to you. (It makes sense that they wouldn't, for obvious reasons, but I would hope that the better broker would come up to the plate and give some disclosure to their customers)...Let me know if you have a minute.. Don
Is OptEx simply software that is designed to route your order to the best option market?? Why would other retail brokers care about this? (since they have their own BEST execution software) what am I missing?
Don, I trade options with IB, and never heard anything about this from them. Is this open only to GS/Schwab customers?
They are buying the order flow and internalising it. Creating the contracts and taking the risk without it going to the any floor or the ise.