A Brawl Breaks Out in the Futures Market – Part 2
"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." - Steve Jobs It's truly amazing what we find deep down in the weeds... The solution to any puzzle starts with the pieces that are easiest to fit into place. Translation: Solutions can start most easily where the most granular data is readily available and easiest to interpret. In [...]
Tradebot Systems: There’s Still Room Under the Radar
"Great things are done by a series of small things brought together." - Vincent Van Gogh In late 2001, $1.1 million in member contributed capital is dropped into Northtown Trading, LLC. By 2005, this operation becomes Tradebot Systems, Inc. and the rest has become a notable component of high-frequency trading history - and mythology. In comparison to much of our other modeling, we don't know much about Tradebot. However, given the contextual evidence provided by that other modeling, [...]
DRW, Jump: A Brawl Breaks Out in the Futures Market
“All profound distraction opens certain doors. You have to allow yourself to be distracted when you are unable to concentrate.” - Julio Cortázar Sometimes we are working one research project, get a call and then need to go chase a squirrel that is part of a different research project. This is one of those squirrels... And as such, it's a chart that causes a reaction - but, we're not ready to say precisely what our reaction is (title and [...]
Goldman Sachs and the Long Arc of Hull Trading
"And the men who hold high places - should be the ones who start - to mold a new reality - closer to the heart." - Rush, "Farewell to Kings" Strap yourself in for this one, as we take a fascinating and detailed walk through some of Alphacution's recent modeling on one of the long-standing Kings of Wall Street; a story that is on the one hand, not widely known and on the other, not typically spoken of... [...]
Adding J. P. Morgan Securities to Bank-Owned Broker-Dealer Modeling
"The world is changing, and we recognize that a synergistic combination might be in the best interest of shareholders..." - James E. Cayne Alphacution has modeled the bank-owned broker-dealer operations for the following: Goldman Sachs & Co. Morgan Stanley & Co. Deutsche Bank Securities, Inc. UBS Securities, LLC Credit Suisse Securities (USA), LLC We now add J. P. Morgan Securities, LLC - formerly known as Bear Stearns & Co... Here's a brief summary of what that analysis shows, [...]
(UPDATED) Two Sigma Investments: How To Build A Nested Alpha Strategy Architecture
"Education is all a matter of building bridges." - Ralph Ellison How trading firms, hedge funds and asset managers scale - as in, scale assets under management (AUM) or proprietary capital, headcount, data, technologies, and other operational ingredients to support a growing mix of market strategies when their initial market strategies reach boundaries of performance, liquidity, inventory or competitive challenges - is a significant point of fascination here at Alphacution. This is because scaling - real, sustainable scaling [...]
(UPDATED) Blackstone Polishes Turd, LSE Bites, And Then…
"Don't hate the player, hate the game." - Jeff Jarrett "Don't hate the player, change the game." - Steve Harvey As we seemingly make a sharp turn from the classically-drunken "I love you, man" phase of the cycle and barrel headlong towards #peakinsanity - as if the wheels are still attached to the clown car blasting along a winding road upon which a noted hedge fund trophy hunter has just stitched a small $99 million coda onto his [...]
Now Wrapped in Pedagogy – Wolverine Trading’s Book: Hiding in Plain Sight
“Not I, not any one else can travel that road for you. You must travel it for yourself.” ― Walt Whitman “The teacher is of course an artist, but being an artist does not mean that he or she can make the profile, can shape the students. What an educator does in teaching is to make it possible for the students to become themselves.” ― Paulo Freire We return to this post, "Wolverine Trading's Book: Hiding in Plain Sight," so [...]
Wolverine Trading’s Book: Hiding in Plain Sight
"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 With this one, we're just going to let the visuals speak for themselves, for now - and see how that goes... I lied... Except for this: We have modeled all the 13F reports we could find on Wolverine entities. With the recent post on Jump Trading in mind, notice [...]
Jump Trading Confirms Our Congregational Feedback Loop
"...We are not now that strength which in old days Moved earth and heaven, that which we are, we are; One equal temper of heroic hearts, Made weak by time and fate, but strong in will To strive, to seek, to find, and not to yield." - from "Ulysses" by Alfred, Lord Tennyson "It ain't about how hard you hit, it's about how hard you can get hit and keep moving forward. How much you can take and [...]
