Trading firm buckles under high costs

Discussion in 'Wall St. News' started by Chuck Krug, Jul 11, 2017.

  1. Trading firm buckles under high costs

    Mocho Trading is the latest Chicago trading firm to call it quits, after only about one year in business.

    The firm, started last year by a co-founder of rival Allston Trading, Elrick Williams, buckled partly because of increased costs for electronically relayed equity and futures pricing data, and for connecting to the exchanges that provide the data.

    http://www.chicagobusiness.com/article/20170710/NEWS01/170719991
     
  2. Mocho? Never heard of them
     
  3. speedo

    speedo

    Another way of putting it is "buckles under inadequate revenues"
     
  4. Mtrader

    Mtrader

    And you will never hear from them again. :wtf:
     
  5. toc

    toc

    It other way, their niche got busted. They probably had a decent business plan but 'new developments' in form of higher costs threw them out of the tune and revenues could not be built fast and more enough to keep up with the costs.

    $5K/month to $200K/month charge would be uncontrollable for any business in any industry.
     
    tradethetrade likes this.
  6. MattZ

    MattZ Sponsor

  7. vanv0029

    vanv0029

    Has anyone tried to trade the CME Globex cheaper exchange
    data fees RTY Russell 2000 contract? Intraday margin is higher
    but overnight margin is lower than TF at IB. So far there is
    only a few thousand contracts per day. I wonder how good
    the arb between them is.
     
  8. SunTrader

    SunTrader

    "Over the past five years, sending that data between Chicago and New York jumped from a cost of about $5,000 to $6,000 a month, when firms were using earlier technologies, to about $200,000 a month for microwave transfers, Iordanov estimates."

    Not the PAST year.

    Like someone else said more likely inadequate revenues.
     
  9. ironchef

    ironchef

    If I am doing HFT, my trading volume must run into the billions per month otherwise it cannot be HFT. So, $200,000 is a drop in the bucket? If so their problem is somewhere else.
     
  10. notional value has nothing to do with profitability.
     
    #10     Jul 17, 2017
    SunTrader likes this.