More Than $2.7 Billion in Payments for Order Flow 2020: Here Are The Breakdowns… (Updated)
“Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver.”Ayn Rand UPDATE (2/17/2021): The following exhibits and content have been updated to reflect an additional $12 million in order routing revenue for Tastyworks earned in Q4 2020; the data for which not being available prior to the initial publication of this Feed post. This brings Alphacution's estimate for total payments for order flow in 2020 to $2.755 [...]
Got Hood-lash Yet? 2020 Order Routing Revenue – Part I
This is the fuel that ignites the chaos. Without it, the New Market Kamikazes run into the friction that keeps the rubber on the road...
A Very Tasty Trade
"What's really happening here is that instead of people becoming engaged in finance when they're 40, 50, 60 or whatever, they're finally starting to learn that - hey - this is really cool. And so, we have an entire generation now which is not only going to support capitalism, it's going to accelerate the growth in free markets and [provide] massive amounts of liquidity so that everybody out there is going to benefit. This is the best thing [...]
GameStop and the New Market Kamikazes
"But how do we know when irrational exuberance has unduly escalated asset values?"Alan Greenspan By now, everyone - and I mean, EVERYONE - knows about how "GameStop (GME), [the] hedge funds’ most-hated stock, was targeted by an army of retail investors who marshaled forces against short sellers in online chat rooms. In the Reddit forum “wallstreetbets” with more than 2 million subscribers, rookie investors encouraged each other to pile into GameStop’s shares and call options, creating massive short [...]
Formula One Trading: Ranking of 25 Leading Proprietary Trading Firms and Key Affiliates
“You wanna know which ring is my favorite? The next one.”Tom Brady The detailed exhibit presented at the bottom of this Feed post is 1) featured in our just-published case study, "The Rise of Hudson River Trading," 2) an expanded version of an already somewhat outdated exhibit originally published in our "History of Jane Street" case study (below), and 3) only an excerpt of a much larger global map of entities that Alphacution has been developing to be [...]
Case Study: The Rise of Hudson River Trading (Executive Summary)
"In playing ball, and in life, a person occasionally gets the opportunity to do something great. When that time comes, only two things matter: being prepared to seize the moment and having the courage to take your best swing."Hank Aaron ** The executive summary for Alphacution case study, "The Rise of Hudson River Trading," is also available for free download (with registration) in our Reports Library ** Introduction As if on cue, and apropos of the times, a [...]
XTX Markets: Lessons in Strategy Geometry – Part II
“Nearly all men can stand adversity, but if you want to test a man's character, give him power.”Abraham Lincoln In Part I of our Lessons in Strategy Geometry concept, we performed a comparative analysis between the shapes of 13F position rankings for HRT Financial, LLC (an affiliate of Hudson River Trading, LLC; the subject of our next deep-dive case study which is in the oven and almost fully baked, I promise), Latour Trading, LLC, and TRC Investments, LLC [...]
Outlook 2021: The Drunk-on-Impunity Mania Arrives
"You cannot escape the responsibility of tomorrow by avoiding it today."Abraham Lincoln With protestors storming the U.S. Capital - some of which breaching the outer doors and freely strolling the U.S. Senate floor - as surreal and unprecedented backdrop, I sit down to organize a sketch of Alphacution's outlook for the year ahead, starting with a very wide lens: The U.S. economy - much like the rest of the other "developed world" economies - is naturally weaker than [...]
Alphacution’s Top Stories for 2020
"You can't connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something - your gut, destiny, life, karma, whatever." Steve Jobs I was going to start out by saying that it's been a pivotal year for Alphacution. Problem is, I said the same things at this time last year. So, I supposed that means it's been a [...]
Cutler Group’s Book: Hiding in Plain Sight
“For last year’s words belong to last year’s language, and next year’s words await another voice.”T. S. Eliot As we were riffing along with our recent Feed post on HAP Trading, I would've sworn than I had already shared a few words on another unique player from the option market making corner of the world, San Francisco-based Cutler Group, LP. Turns out, I had not... With the upcoming publication of a deep-dive case study on Hudson River Trading [...]
