Alphacution publishes new charts comparing SPY options, SPX options, and SPX futures options to illustrate the blessing - and curse? - of the 0DTE phenomenon, reliance on retail investors, and market concentration risks...
Citadel Securities overtakes Susquehanna Securities for year-end 2023 by this metric. Problem is, there's an asterisk. This Feed post is excerpted from research for Alphacution's long awaited case study on option market makers...
With this update to the Feb 2023 Feed post, "IMC Overtakes SIG," Alphacution proposes that the battle between IMC Financial Markets and Susquehanna International Group (SIG) in US option wholesale market making represents more than meets the eye...
Alphacution provides additional evidence - via Robinhood - that option order routing revenue, the primary source of PFOF, is being negatively impacted by retail adoption of 0DTE option trading - as well as emerging indications of a resurgence in crypto trading...
With latest data in hand, Alphacution shows that the zero-day option (0DTE) phenomenon has contributed to long-term declines in aggregate payment for order flow (PFOF) levels thereby causing a ripple of subtle and not-so-subtle impacts in the market ecosystem...
Returning to a provocative thread from late 2022, Alphacution updates some of Morgan Stanley's latest moves in wholesale market making...
On the 1-year anniversary of what would turn out to be Part I of this thread, Alphacution adds new details to the story of New York-based prop trading firm GTS Securities and its emerging adventures in option market making...
For the longest time, the use of technology gradually removed excess costs and other inefficiencies from financial markets. This evolution wasn't just about speed, although that was a key element. And then advanced quantitative trading techniques, social media techniques, and mobile-first technologies converged. This is Alphacution's view on what's happened since and what that means for the road ahead...
In further preparation for its upcoming case study focused on option market makers, Alphacution identifies a seemingly insignificant shard of evidence that may represent Tower Research Capital's first foray into equity option trading...
Alphacution has been quite busy developing its next case study focused on option market makers. To build context for that research, we have been expanding our understanding of institutional option traders. It turns out that there is a familiar cast of characters in this space, including some of the most legendary quantitative hedge fund managers...
