Alphacution Press: New York Times and Robinhood
“Its users buy and sell the riskiest financial products and do so more frequently than customers at other retail brokerage firms, but their inexperience can lead to staggering losses.” – by Nathaniel Popper Alphacution contributes to The New York Times’ development of story on Robinhood, “Robinhood Has Lured Young Traders, Sometimes With Devastating Results” (July 8, 2020).
Phenomenon: On This Score, Robinhood Now Exceeds E*Trade, Others
"It is a mistake to look too far ahead. Only one link of the chain of destiny can be handled at a time." - Winston Churchill The holidays, with all of its gift-giving elves, came early this year with new data; data that I have been crunching non-stop for the past week - and will likely continue to crunch in the week ahead. The exercise has yielded one "I-shit-you-not" revelation after another after another, almost as if [...]
Trick Shot: Robinhood Underwrites MEMX
“Principles for the Development of a Complete Mind: Study the science of art. Study the art of science. Develop your senses - especially learn how to see. Realize that everything connects to everything else.” - Leonardo da Vinci If there ever was a time to see how things are connected to other things, it is now. This is particularly true in places where something that is "free" is interpreted to be "without cost." After all, like "free" [...]
Peak6 Investments and the Baking Soda Index
"For every action in nature there is an equal and opposite reaction." - Sir Isaac Newton The performance - or, health - of complex systems is difficult to measure. Typically, you need deviations from norms across numerous sensors - the analytics - converging to signal whether a complex system is functioning properly or not. Add the inevitability of change, and the task becomes exponentially more challenging as continuity of measurement over time decays... And then, there's the stuff that's [...]
Capitalism? Both Automation and Failure Elude Major Banks
"I don't know where I'm going from here, but I promise it won't be boring." - David Bowie For someone who has spent a career scanning the landscape for cataysts - as if in perpetual "sentry mode" - it's damn near impossible to consume the latest news and not become introspective. Perhaps that is merely the occupational disposition of someone who regularly commits thoughts to pixels. It's difficult to conjure up this week's musings on the state of [...]
Case Study: History of Jane Street
"I don't stop when I'm tired, I stop when I'm done." - James Bond Alphacution publishes its 125-page, 149-exhibit, 26,000-word case study, "History of Jane Street," with notable expansions into regional, US option strategy and revenue estimation details. The following is the Opening to that report with Table of Contents, including download of the full Executive Summary. Access to this report is available to Premium Subscribers. Subscription and individual report purchase inquiries can be directed to info@alphacution.com. [...]
Virtu Financial: Master Exploder, Part II
"Empty your mind, be formless, shapeless — like water." - Bruce Lee In "Master Exploder, Part I," we presented a first pass at Virtu's Q1 2020 earnings release given the impacts of unprecedented volatility in March. If you're tracking closely - or merely fascinated by - this neck of the woods, be sure to check in on that one, and the one on Flow Traders' Q1 earnings that preceded. Both releases presented outstanding, one-of-a-kind results. As noted [...]
This Fed Put is Out of the Money
Don Dale, Chief Risk Strategist for Equity Risk Control Group, is a guest contributor to the Alphacution Feed. I am not a funny guy. (Ask my wife...) And yet, occasionally - when I say the quiet part out loud - I manage to get a laugh. My latest bit is an idea about how to "fight the Fed." So, while you may enjoy a chuckle at the thought, here's why I think things might be different this [...]
quantPORT: First Look at Jefferies Quant Spinout
"Do or do not. There is no try." - Yoda Today, a post by efinancialcareers was first to report - followed by Bloomberg News - that Jefferies Group would be spinning out the quantPORT division of its Jefferies Investment Advisors (JIA) subsidiary. According to these sources - and regulatory filings - quantPORT (branded as such in 2018) began as a proprietary systematic equity trading team within Jefferies in 2006. As of January 2020, quantPORT claimed regulatory AUM [...]
Virtu Financial: Master Exploder, Part I
"As you think, so shall you become." - Bruce Lee Like a one-legged man in an ass kicking contest, sometimes the scenario is grim. And yet sometimes, the tailwinds converge in your favor - like a three-legged man in an ass kicking contest - and the scenario presents itself very much to the contrary... Historically, Alphacution has not been shy about pointing out the former. Who can forget "Virtu Financial: The Frying Pan and the Fire" from [...]
