French television discover evil traders

24 Jun 2012

Mainstream journalists usually miss the ball when reporting on financial trading.  In France this is probably even worse. Time for a piece of infotainment from the French national television on those evil high frequency traders. Tune in for Cash Investigation.

Some of the most notorious traders manipulating the world in a Goldman Sachs-like fashion are based in good old Amsterdam. Right on one of our pittoresque canals we find Market Wizards. Filmed with undercover camera and faces blurred – boy, this looks suspicious. A financial Peter R de Vries from France.

Honestly, those traders at Market Wizards are as far from high frequency trading as one can get. Old school trading with their own capital. Kept up with the automated trading techniques, but not a financial powerhouse trading at the speed of light. Good reputation for smart trades and organizing the yearly poker tournament for charity.

The modest incident one of their traders has been fined for, dates from the stone age. Six years ago without any use of automated systems.

If Market Wizards is into HFT, I’m the Washington Post. See from min 52.20 the item on Market Wizards. Followed by an interview with Remco Lenterman. The former GS banker working for IMC and part of the lobby group FIA EPTA.

And yes, everything is in French:

http://www.youtube.com/watch?v=GLrq9GIH8cU

 

85 Responses to French television discover evil traders

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anonymous

June 24th, 2012 at 11:16 pm

The Dutch regulator should investigate the partial offer from American mobile to Kpn, so fuck up for the small investor

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anonymous

June 25th, 2012 at 2:42 am

what’s wrong with the partial offer from American Mobile to KPN ?

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anonymous

June 25th, 2012 at 2:49 am

The French Documentary is like many other attempts in the past, half baked understanding dished out with healthy garnishing of sensationalism, hasn’t people lost interest in this already, look at Getco, they are firing people and moving onto client business, lol,

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anonimus

June 25th, 2012 at 9:36 am

Market Wizards? Ils achetent des velos. Apres ils manipulent le marche et apres il vendent les velos plus chere. Minute quarante huite.

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anonymous

June 25th, 2012 at 10:08 am

Market Wizards? They buy the bikes. After they manipulate the market and sell it after the bikes more expensive. EIGHT forty minute.

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anonymous

June 25th, 2012 at 12:12 pm

Ian´s minute of fame…….Jammer dat die Fransman er de hele tijd doorheen #”%$

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anonymous

June 25th, 2012 at 2:49 pm

“docu” probably financed by the taxpayer as usual. Hilarious explaniation wis zie bikes. I zink zie Germans did it!

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anonymous

June 25th, 2012 at 3:38 pm

it is still not clear why high frequency is bad, it seems the docu makes a postulate according to which it is associated to cheating, manipulating markets, and not having any social utility. These assumptions are of course bullshit, the fact that some HF traders manipulated markets does not mean that all do. Should we than close markets because even some low frequency traders in the past 100 years manipulated markets? All arguments against high-frequency trading also hold for traditional trading and asset management, the time line does not affect things. Both look for a return and take risks, use technology and information to make decisions. What’s the difference?

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anonymous

June 25th, 2012 at 3:41 pm

and what’s about front running client orders? This is a standard practice as floor brokers informally can provide information on the flow, and it seems it is even completely legal in FX markets. Such topics should have much more negative impact than high frequency trading

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anonymous

June 25th, 2012 at 10:13 pm

I’ll tell you why high frequency is bad, look at LSE, the retail has to pay 0.5% stamp duty while the high freq is expempt, from there on the low latency, direct connectivity, dma, dark pool, trading fees, broker fees, the cards are stacked sky high against retail,

this is of course not condoning front running, what other things do asset mgmt or banks do that high freq does not get to do ?

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anonymous

June 25th, 2012 at 11:04 pm

are you joking? banks and asset managers are squeezing the retail customer much more than high frequency traders, let’s start with the fee for “actively” managing assets, a simple index tracking fund will outperform it. Then all this bullshit structured products, those who sell them do not own them in their portfolio. The whole banking/asset management industry is a robbery towards the retail customer, with ridiculous commissions everywhere.

Thanks to high-frequency retail customers can enjoy better spreads and also reduced costs, the problem is that often exchanges and brokers also squeeze the retail customer, by not passing them better costs structures which they have thanks to high-frequency traders. Also keep in mind that brokers and exchanges often sell their customer flow and do not pass the proceedings to the retail customers.

To keep it short, retail customer in first line exploited by banks, asset managers, brokers, exchanges.

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anonymous

June 26th, 2012 at 7:41 am

High Frequency Market Manipulation. That’s when you do it every day.

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anonymous

June 26th, 2012 at 10:12 am

and what’s about the low frequency market manipulation? Is is also not done every day?

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anonymous

June 26th, 2012 at 2:19 pm

the truth is that traditional asset managers and low frequency traders are not making anymore much money and feel cut own by others, that’s why the fight against high-freq trading. They should know that progress cannot be stopped.

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anonymous

June 26th, 2012 at 7:28 pm

Banks and Asset Mgmt charges don’t squeeze retail behind their backs, their charges are clear and visible, high freq are the real market makers now a days and they are the ones eating up bid-offer spreads,
 
If you don’t like fees for active mgmt, str pdt, commissions, you are free to walk away or choose a better option; the same can’t be said for high freq, they are the market now, there is no other option but to go to them and pay bid-offer, they are not doing any great favors by not charging high bid-offer, that’s competition from other high freq that keeps bid-offer tighter than historical, but it’s a real cost and that’s how high freq funds their multi-million payouts, little spreads charged over billion times daily,
 
It’s not the case whether traditional asset mgr/low freq traders are getting cut down and so have to fight tech/high-freq, the pertinent question for retail is whether they should be so severely put at disadvantage compared to high-freq who can invest in infra, its just not fair race is it, is all this liquidity and tight spreads worth the disadvantage that retail has to suffer,

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anonymous

June 26th, 2012 at 10:14 pm

@7:28 pm
dude how did you end up on this forum? you clearly have no clue

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anonymous

June 26th, 2012 at 10:44 pm

you seem to have lot of clue, care to share?

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anonymous

June 26th, 2012 at 11:27 pm

1. retail traders are always put at disadvantage, in particular by brokers and banks, nothing to do with high-frequency traders.

2. Bid-ask spreads became smaller do to high-frequency traders, this is proved, i.e. trading costs are lower now than ever

3. The biggest scandals (market manipulations, market crashes, etc) in the financial history have not been caused by high frequency trading companies, but by banks, asset managers and low frequency speculative traders, just think about the current financial crisis which originates from the house market bubble (CDOs, etc), all this has nothing to do with high frequency trading.

4. There is enough research showing that high-frequency trading reduces market volatility

5. Thanks to high-frequency traders, prices are maintained fair and market efficiency is enforced, this is a major benefit rarely mentioned. All financial mathematics makes one key assumption to derive pricing formulas: the non-arbitrage argument. High-frequency traders make sure that this assumptions holds and allows thus to understand and model markets, which in turn is key to make sound financial decision, at any trading frequency. Last but not least, access to exchanges and low latency technologies are available to all, it is much more expensive to get a banking licence.

6. Up to now, the taxpayer money went to rescue banks, to indirectly pay bonuses to persons such as the CEO of GS, no taxpayer money ever went to high-frequency companies

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anonymous

June 27th, 2012 at 12:52 am

1.       How’s bank/broker charging fees any different from high freq charging bid-offer spread?
2.       Spreads are small because high-freq compete with other high-freq, they are not doing anyone special favour by quoting tight,
 
How do you mean trading costs are lower than ever, don’t come up with generic statements out of your arse,
 
3.       Don’t point to fallacies of bank and distract the discussion, stick to debating high freq, its pros and cons,
 
4.       Again, don’t come up with generic research out of your arse, what was that, flash crash,
 
5.       Stop thanking generic group of financial market participant over something which you describe as ‘benefit’, what’s the benefit in you siphoning off millions from the capital markets ?
 
Financial Mathematics Assumption is just that, just one assumption, I thought you had a clue of what you are talking about. Even then, how are you bring over no-arb to stat arb ?!
 
How is the access and technology available to retail ?!
 
6.       Again, don’t point to banks to remove attention from all the siphoning off millions from the capital markets by the high freq, banks are being looked at number of ways to fix their monopoly, high freq have slipped under the radar since last year and half,

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anonymous

June 27th, 2012 at 7:35 am

HFT resemble those salesmen you find in many 3rd world countries that keep hassling you; at first they seem okay and appear to give you a good price, but in the end they get so terribly annoying that you wnt to walk away and stay away. And this will kill HFT, ’cause in the end all the other market participants will stay away, and they will have to eat eachother

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anonymous

June 27th, 2012 at 8:06 am

@12:52 am
dude i think you really lost it. so you rather be paying a 10 tick spread as a retail investor with no high freq around rather then paying 1 tick to the high freq guys? well economics was not your strongest subject in school i guess.

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anonymous

June 27th, 2012 at 8:45 am

I’m with @8.06
But I’ll be generous: @12.52, you asked for research: have a read of this: http://www.optiver.com/corporate/our-views/hft-position-paper

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anonymous

June 27th, 2012 at 9:43 am

that’s and excellent paper

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anonymous

June 27th, 2012 at 11:05 am

Francois Arago a 19 century prominent french scientific used to warn passengers of the first trains of the dangers associated with speed…..thinking they would die of pneumonia

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vincent

June 27th, 2012 at 11:29 am

For the ones that don’t perfectly understand our wonderful language, you missed some experts saying that there is basically no human involved whatsoever and that bots are on their own—>>>flash crash!!!
At some point they went to see the man behind France’s smaller equivalent of renaissance technologies (capital fund mgt) and tried to make him admit that he’s doing HFT like it’s some sort of financial markets plague…

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anonymous

June 27th, 2012 at 1:49 pm

HFT is not financial market plague, but it’s no great benefit its made out to be, it seems to have given higher ‘appearance’ of liquidity and tight quotes, pls note the emphasis on word appearance, but the cost of it is billions being made out by high freq companies from capital markets, is the cost worth the appearance?

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anonymous

June 27th, 2012 at 1:55 pm

Just because Francois Arago had irrational phobia doesnt mean that all new technology can be branded as all benefit and no cost,

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anonymous

June 27th, 2012 at 1:58 pm

‘so you rather be paying a 10 tick spread as a retail investor with no high freq around rather then paying 1 tick to the high freq guys?’

why do you assume i’ll pay 10 ticks, i’ll wait for other side to come in and then we can be matched in the middle, probably the other side will even pay me 1 tick, how’s that for a change?

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anonymous

June 27th, 2012 at 2:01 pm

‘why do you assume i’ll pay 10 ticks, i’ll wait for other side to come in and then we can be matched in the middle, probably the other side will even pay me 1 tick, how’s that for a change?’

it what is the problem if this happens rapidly and you just program your intentions and let a computer execute this?

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anonymous

June 27th, 2012 at 2:06 pm

‘But I’ll be generous: @12.52, you asked for research: have a read of this: http://www.optiver.com/corporate/our-views/hft-position-paper

lol, Kip is starting to write position papers, i guess age is catching up with him, anyways, just to remind you, this is like going to a sales person and asking if his good makes sense, of course they make the most sense, what do you expect sales person to tell you, his good makes no sense ?

Likewise asking Optiver if their business is good for society, of course they’ll write a paper claiming its business is freaking brilliant for the society,

haven’t you ever seen a Sales Desk in operation ?!

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anonymous

June 27th, 2012 at 2:08 pm

‘it what is the problem if this happens rapidly and you just program your intentions and let a computer execute this?’

you expect mom and pop investors to do that, or for that any retail to do that? how do you expect them to get an dma, support infra and co-location,

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anonymous

June 27th, 2012 at 2:34 pm

the point is that they do not need all this, assume for a moment that retail investors would get free colo and all infrastructure. What would they do with it? Are they able use whatever math/stats notions to buy and sell? Probably no, and if yes then they can work for a high frequency company.

You make the assumption that ALL high-frequency traders are or get rich by trading, that’s absolutely NOT TRUE. It also seems that it is enough to get colo etc to make plenty of money… The truth is that a retail trader could never do high freq trading, even if she/he would have all the infrastructure.

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anonymous

June 27th, 2012 at 4:01 pm

the point if not about retail to do high freq, but the high freq to not be given special advantage, they should be paying the same 0.5% stamp duty that are charged to retail for UK Stocks, alternatively, EU can come out with tobin tax, since the billions taken out by high freq from capital markets are not really adding value, its like bunch of rats let loose in your nation’s grainary, what good do they do,

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anonymous

June 27th, 2012 at 11:08 pm

I just saw the french movie, it is ridiculous, they claim that high-frequency traders make a fix salary of 100-200 k EUR and a bonus of millions. This figures might be valid for a few top traders but for sure not for the average trader. It gives the impression that high-frequency traders make millions by cheating, what a bullshit. They interview some traders which explain some non-proper strategies, so they imply that all high-frequency is market abuse… Such documentaries are just propaganda and not worth the time to watch, but you only realize it after seeing it!

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anonymous

June 27th, 2012 at 11:52 pm

Round numbers of 100-200k + mio of bonus are easy to use in propaganda and sensationalism, average Joe is not smart enough to not buy in, specially in middle of 6-pack,

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anonymous

June 28th, 2012 at 8:53 am

‘why do you assume i’ll pay 10 ticks, i’ll wait for other side to come in and then we can be matched in the middle,’

What stops you (or any other retail investor) from joining the bid when there are HFTs around? I still don’t see how HFT is bad for retail. The argument that they make money (‘siphoning billions off the market’) is BS of course, it’s not like the specialists/hoekmannen/market makers/brokers in the old days didn’t make any less money.

‘Likewise asking Optiver if their business is good for society, of course they’ll write a paper claiming its business is freaking brilliant for the society,’

Would you be able to refute the arguments they make in the paper? There’s a difference between just saying something is brilliant, and writing a paper with all your arguments why you think so. If someone bothers to do the latter, at least try to come with a better reaction than just challenging their credibility. If they’re wrong it can’t be hard to shoot holes in their story.

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Heisenberg

June 28th, 2012 at 9:48 am

http://www.economist.com/debate/overview/224

Please read through this before taking this any further, especially those who feel they lack expertise on the issue. If The Economist is of the opinion that HFT contributes to the overall quality of markets, you’d better have a damn strong case to argue otherwise.

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Bryan

June 28th, 2012 at 12:58 pm

I don’t know who you are. I don’t know what you want. If you are looking for a directional punter, I can tell you I don’t follow Elliot Waves. But what I do have are a very particular set of skills; skills I have acquired over a very long career. Skills that make me a flash-crash for people like you . If you hire me now, that’ll be the end of it. I will not front-run you, I will not set my algorithms against you. But if you don’t hire me, I will look for you in the matching engine, I will find you in the screen, and I will fill or kill you.

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anonymous

June 28th, 2012 at 3:44 pm

@ Bryan: SOLD

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anonymous

June 28th, 2012 at 5:11 pm

 
‘The argument that they make money (‘siphoning billions off the market’) is BS of course, it’s not like the specialists/hoekmannen/market makers/brokers in the old days didn’t make any less money.’
 
The argument is not BS, one wrong before doesn’t make this new wrong any more correct,
 
 
‘I still don’t see how HFT is bad for retail.’
 
See the above argument, it’s not BS, high freq just not a value add, if banks are branded as frictional cost, so is high-freq,
 
 
‘Would you be able to refute the arguments they make in the paper?’
 
Optiver paper has got several arguements, which particular argument are you referring to?
 
 
 
‘If someone bothers to do the latter, at least try to come with a better reaction than just challenging their credibility’
 
Optiver pays the salary of those three employees and that’s why they came up with elaborate sales pitch for their business, again, haven’t you seen a sales desk in operation, it’s the job of the regulator to come up with a formal investigative paper, there ain’t an incentive for me to waste me time going through all the formalities of writing a paper,
 
 
‘If they’re wrong it can’t be hard to shoot holes in their story.’
 
If you have been following the discussion above you should have already followed the points both on pros and cons,

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anonymous

June 28th, 2012 at 5:12 pm

Economist is meant for non-technical read, for broad mass market reading ability, though you can quote if you see a particular relevant insight in it, chances are slim though,

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Heisenberg

June 28th, 2012 at 6:32 pm

The whole point of the Economist debates is to generate a useful discussion between two experts in the field. You don’t need a barrage of technical terms to make a point. In fact, being able to clearly explain technical things to a layman requires a particular finesse in the matter. The arguments and insights offered in this debate are highly relevant, something you undoubtedly would agree with if you had bothered to take a look.

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anonymous

June 28th, 2012 at 8:15 pm

Yada yada yada … who cares.

Optiver’s result for 2011 is out: 160 million euros net profit on trading revenues of just over 620m. And a diminishing slice of the pie coming from its Amsterdam (=European) operations.

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anonymous

June 28th, 2012 at 8:26 pm

620m is pretty good, wasn’t it something like 750m in 2008 for them, that was their supposedly best year ever,

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anonymous

June 28th, 2012 at 8:33 pm

 
‘You don’t need a barrage of technical terms to make a point’
 
While you don’t need barrage, but economist style of broad mass writing use a lot of simplifying assumption, while technical terms can be avoided but over simplifying misses the crucial point,
 
 
‘The arguments and insights offered in this debate are highly relevant, something you undoubtedly would agree with if you had bothered to take a look.’
 
Also, you don’t need to read every debate on the subject matter, mostly the points are being rehashed, as an industry practioner you don’t need to keep reading same thing over n over again, is there any argument or issue in the economist debate which you see that hasn’t already been discussed on this forum ?

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anonymous

June 28th, 2012 at 11:43 pm

how is that ?

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anonymous

June 29th, 2012 at 3:06 pm

where is the optiver financial report?

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Yosha

June 29th, 2012 at 4:01 pm

@Bryan *in chinese accent* GOOD LUCK!

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Marko

June 29th, 2012 at 4:07 pm

I think Yosha is watching the bootlegged version

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anonymous

June 29th, 2012 at 6:42 pm

Who is this Bryan guy, is this character on movie or something ?

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anonymous

June 29th, 2012 at 6:47 pm

Optiver report

The year 2011 was a strong year for Optiver and an important milestone for the company. Optiver today announced that the net profit attributable to equity holders in 2011 amounted to € 159.9 million, compared with a net profit to equity holders of € 75 million in 2010. The 2011 result from operating activities was €260.0 million versus € 111.1 million in 2010.
With 40 job vacancies open at present, our Global headcount remained level at 588 and the cost income ratio decreased from 60% to 47%. Net trading income for the financial year amounted to € 487.4 million, representing an increase of 75% compared to the € 278.4 million in 2010.

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anonymous

June 29th, 2012 at 7:01 pm

Compensation attributed to staff of 588 was ~ € 110million

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anonymous

June 29th, 2012 at 7:48 pm

is the IMC report also out?

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anonymous

June 30th, 2012 at 12:56 am

So the trading revenue were 490m rather than 620m speculated earlier, still good jump from 280m in 210,
 
From 490m, 230mio is booked as cost and rest 260m as operating income, does this 230m cost include 110m comp,
 
For 260m operating income and 160m attributable to partners, where’s the other 100m going,
 
110m comp is not reflective of Partner’s bonus, Large portion of 160m should be going to Active Trading/Partners,

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anonymous

July 1st, 2012 at 3:54 am

@ Large portion of 160m should be going to Active Trading/Partners,

~10% will go to active trading partners

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anonymous

July 1st, 2012 at 12:07 pm

how many active trading partners are there ?

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anonymous

July 1st, 2012 at 12:49 pm

@ 12:56 are you a six year old or what? the 620 million weren’t “speculated” they were factually reported (in Optiver’s annual report and in subsequent press reports). Difference between gross and net trading revenues. The 750 from 2008 were also gross. Don´t just assume that because you don´t have a clue that others must have been speculating.

Of course the 230 includes the 110. Because 260 – 110 – taxes << 160. As for 260 gross (operating income) becoming 160 net (profit) … have you ever heard of taxes or do you think Optiver doesn't have to pay any taxes thanks to "global tax optimization"??? This can also include extra money set aside (like they did two years earlier for the CFTC case) etcetera. Plus the company continues to lose money on non-core activities such as the TOM platform. That's how 260 operating income becomes 160 net profit. It's really not that difficult to comprehend if you THINK about it.

Active partners (including senior management and a number of traders) will receive their bonus out of the 110. That's the bonus pool for all employees after all. In the end the 160 million is the profit attributable to shareholders that can be retained or paid out as a dividend. Referring to the shareholder´s profit as a `bonus´ to (active/silent) Partners is quite a unique way of looking at it, especially if earnings are retained. It makes one wonder if you ever received a bonus of any kind for otherwise you'd understand how this stuff works and refrain from uttering your bs.

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anonymous

July 1st, 2012 at 1:44 pm

calm down man, why are you getting so excited, so 620m is the gross trading revenue, the same number in 2008 was 750m ?

Now 620 – 140 = 480m is the net trading revenue? is that 140m going to exchange/clearing fees or something else?

‘Of course the 230 includes the 110′
is this 100% confirmed?

‘As for 260 gross (operating income) becoming 160 net (profit)’
how much of that 100 is the taxes?

‘Optiver doesn’t have to pay any taxes thanks to “global tax optimization”???’
why do you keep taking piss at this tax planning, is it too much for your brain with excessively large superiority complex to comprehend?

‘It’s really not that difficult to comprehend if you THINK about it. ‘
i don’t want to think and speculate, if you know 100% what it is, then say, otherwise just calm down or buzz off,

‘Active partners (including senior management and a number of traders) will receive their bonus out of the 110.’
as partners and equity holders, don’t you receive dividends from 160m? you seem to have received large bonuses large number of times, but you still keep coming up ways to contradict and flip flop on your statements, makes you wonder how much sucking you had to do,

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anonymous

July 1st, 2012 at 3:34 pm

@ Now 620 – 140 = 480m is the net trading revenue? is that 140m going to exchange/clearing fees or something else?

140m would include exchange fees clearing fees brokerage fees,. Think of it as the Cost of goods sold.

@ Active partners (including senior management and a number of traders) will receive their bonus out of the 110.’ as partners and equity holders, don’t you receive dividends from 160m?

The partners no doubt have small equity stakes but The initial founding team still controls majority of equity in the firm and gets a lions share of it. (Think of the top guys featured in the quote.nl 500)

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anonymous

July 1st, 2012 at 3:47 pm

wow, 140 off 620 is pretty large number, almost 25%, this % should have been lot lower in 2008 when their volumes were not as high and when they were doing lot less high freq,

so how many active trading/partners are there and what is their ownership % like, they were trying to come up with Jr Partner to manage these dividend payouts, 110m for 600 staff is like 250k USD average, most investment banks have like 400k + USD average,

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anonymous

July 1st, 2012 at 6:12 pm

You are talking about investment banks in London where purchasing power is about 1/3 of amsterdam?

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anonymous

July 1st, 2012 at 6:54 pm

you cannot take the average, most of the staff does not get much, especially developers, risk mangers, and supporters. The average trader/quant is as well payed very little, only few star traders and managers will get most of the cake. So most of the people are better off in an investment bank

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anonymous

July 1st, 2012 at 7:17 pm

110m total comp still doesn’t sound right, if you take 60m more as dividend for active partners, that makes it total 170m and then the average comp reaches around 400k USD, quite inline with banks,

Banks are better for mobility, brand and diversification for sure,

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anonymous

July 1st, 2012 at 7:19 pm

Purchasing power in London is not 1/3 of Amsterdam, stop with hyper language, look at costliest city surveys, London is like 25, NY 30 and Amsterdam 50, it doesn’t mean the purchasing power in Amsterdam is half or something, though Amsterdam is happy village, your million fees like 10million because its so laid back, NY/LDN are places with high concentration of wealth and power, your million feels like mere ton; wealth, health and happiness are relative, you look at your neighbourhood and decide how happy/ wealthy you feel, the point,

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anonymous

July 1st, 2012 at 9:46 pm

losers , you’re totally missing the point . While you’re busy posting BS others re making a shitload of money . Hello helllo , losers !

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anonymous

July 1st, 2012 at 10:38 pm

why do you think posting BS and making shitloads of money are mutually exclusive, really, both can’t be done at the same time?!

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anonymous

July 1st, 2012 at 11:18 pm

tomorrow i’ll make money again, but today is sunday and the exchanges are closed so then it’s perfectly fine for me to call others out on their bs.

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anonymous

July 2nd, 2012 at 12:38 am

well technically you can do your quantitative analysis and backtesting on Sunday and start making even more shit loads of money first thing monday morning,

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anonymous

July 2nd, 2012 at 6:57 am

i already finished doing my research first thing saturday morning thank you very much

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anonymous

July 2nd, 2012 at 8:14 pm

how do you mean you finished research, it’s not a bloody primary school homework you finish one fine morning, it’s never ending trial and tribulation, finding the quantitative strategies, building new ones, optimizing existing ones,  how do you mean you finished research first thing Saturday morning,

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anonymous

July 3rd, 2012 at 12:04 pm

According to this site, only 10% of its profits came from the Amsterdam office

http://fd.nl/beleggen/151051-1206/winst-optiver-verdubbeld-naar-159-mln

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anonymous

July 3rd, 2012 at 1:36 pm

As I was correctly speculating, personnel cost at 164.5million (not sure if dividends for active partners included) brings average to 350k+ USD, not far from banks, but this year was lot better compared to last 3 years,
 
Also speculation about active tax planning could prove to be correct, 10% profits in Amsterdam doesn’t sound right, what’s the split of 620mil across Chicago/syd/ams, like 20/30/50? looks like they booked all expenses through Amsterdam, which entity is being used to save the tax bill?

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anonymous

July 3rd, 2012 at 1:37 pm

Optiver profit doubled to € 159 million

The great Dutch trading houses have had an excellent year in 2011 thanks to the tension in financial markets by the debt crisis.

After earlier IMC and Flow Traders reported strong earnings growth, following today Optiver with a doubling of profit compared with 2010 to € 159.9 million which is the best result after record year 2008. Net trading income was € 622.8 million

“The turmoil in global markets by the debt crisis in Europe, not to mention the discussion about the debt ceiling in the United States, was accompanied by high trading volumes,” says director Jelle Elzinga Optiver. “That was a major driving force behind this strong performance.” The settlement of an accusation of manipulation of oil prices in the U.S. has no influence on the figures in 2011, just as a possible levy the tax for 2001 yet.

Optiver began a quarter century ago when trading on the Amsterdam Options Exchange. Meanwhile, the company negotiates with 588 employees for its own account in options and other derivatives on exchanges in the United States, Asia, Australia and Europe. According Optiver is only 10% of profits from trading in Amsterdam.

Trading Houses, like Optiver, earn their money by quoting prices at which others can act and arbitration; taking advantage of price differences across multiple markets. In both cases, the benefits increase as more investors make transactions and prices move brighter. That led to record profits in 2008, when U.S. investment bank Lehman Brothers fell. The years 2009 and 2010 were slightly less, but last year was exceptionally good.

Despite the good results over 2011 market experts warn that the golden age for independent trading houses are over. Volumes are structurally lower because banks are less active in the financial markets due to new capital requirements and the prohibition on proprietary trading in the U.S.. On peaks during panic moments after, press the debt crisis on the volumes. And so is taken into account consolidation in the sector. Thus, two weeks ago announced that Flow Traders is for sale.

“The business model has changed tremendously over the years,” says Elzinga Optiver. The investment required in information technology and global connections have risen substantially. “You must continue to invest to stay ahead in this sector. If you can share those investments, it may make sense. ” Elzinga expects Optiver remains independent, like competitor IMC. “It will be rather small parties that are merging.” Moreover, personnel with € 164.5 million by far the largest cost for Optiver.

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anonymous

July 3rd, 2012 at 2:36 pm

The article says: ‘Volgens Optiver komt nog maar 10% van de winst uit de handel in Amsterdam.’
Maybe they mean that 10% of the profit is from trading on Euronext Amsterdam, not 10% of the profit is from the Amsterdam office? Seems also logical since the sentence follows one where it says they started 25 years ago on the floor in Amsterdam…

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anonymous

July 3rd, 2012 at 3:21 pm

The only products that trade on Euronext Amsterdam which could be money makers would be AEX and dutch stocks. Highly unlikely 10% of the profits would come from those products.

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To Anonymous 1:36pm

July 3rd, 2012 at 6:42 pm

yah we know your a moron. no need to give yet another demonstration. salaries and wages never includes any potential dividends paid to employees who also happen to be partners. do you even grasp the difference between a salary / bonus paid to an employee and a dividend paid to a shareholder? do you think GE count the dividend income that their employees enjoyed on their GE shares as part of their salary expenses or do you think they book them as……dividends paid??? if you had ever been on the receiving end you’d know the difference!! what does that say about you? that your probably a clueless IT or a useless quant. lol

the earnings of the amsterdam office have been going down relative to oz / us for years. the last time more than half of optiver’s revenues were generated in amsterdam was 2006. six years ago buddy. stop living in the past and stop spreading your bs, you don’t know what your talking about and your not even entertaining.

as for the average income and how this compares to a banker … WHO CARES?! more than half of the people at optiver are not in a trading role so (apart from management) their bonus is a pittance. the level of your stupidity tells me your well-suited for a bank. yah on average you’ll be doing fine. but i doubt youll be bringing home $350k. hopefully they’ll block your access to this blog. wouldn’t that be nice.

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To Guy above with Superiority Complex @ 6:42pm

July 3rd, 2012 at 8:05 pm

What’s your problem man, is your whole life built around trying to call other person names, I don’t know what your parents did to you, but keep it to yourself ya,
 
Coming on to your helpful and brilliant observations, 164.5m is supposedly personnel cost from the article, you seem to be referring this as salaries and wages, last week 110m was reportedly the figure, the extra 54.5m could possibly be part of marble system that is being actually booked as partner’s dividend for tax purposes, but could be referred informally as personnel cost, again speculation, but your highness is offended with harmless speculation it seems, learn to take it easy ya, not everybody is as smart as you, you know,
 
You seem to be all-knowing big shot, all hail down to you, the pure genius,
 
What’s the current revenue mix for Chicago/syd/ams, you seem to know what you are talking about, or is that just hot fart you keep around you ?
 
The average income is just a number that can be looked at in absence of any other number, do you have any other number you have to offer, with all your brilliance surely you don’t need to look at any number, the rest can decide for themselves whether they want to look at this or not,
 
Before I forget, with all stupid distraction from you, all the proposed guess about taxes, comp, averages etc are all in line with what’s going on ground as and when information comes out, not sure why you feel enraged with this, you can’t seem to bear other people’s views, is that the problem you have, no let me make another speculation, you are just too smart and all this you figured out years ago, now you entertain yourself deriding others?
 

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amsterdam trader

July 3rd, 2012 at 8:23 pm

164 = 110 + 54

Total = Bonus + normal salary’s

No dividend No tax involved

Nothing informal here, comes straight out off Annual Report. Why speculate then ? just read it

PS you do sound like one of those clueless IT’s at my job :-)

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Guy with complex 6:42

July 3rd, 2012 at 8:45 pm

i’m not attacking other persons, only you. yah it’s kinda easy to detect your posts. because of the nonsense and your use of “yah”.

it would be incredibly stupid to book trader bonuses as dividend in the accounts, or dividend to one shareholder as a bonus to said shareholder/employee. because dividends must be paid out proportionally to ALL shareholders. or do you think all shareholders don’t mind forging the books and forfeiting dividends so that some traders pay less income tax??

it’s nonsense like this that make me say once more: stop sharing your useless speculations on this blog. i come here to read about news, facts and a bit of gossip i must admit every now and then. what i don’t care for is nonsense. i doubt anyone else cares about what you think (i know i don’t). your polluting this blog with your speculation on just about every topic and post. show some restraint buddy.

yah?

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anonymous

July 3rd, 2012 at 9:11 pm

The documentary is as ‘good’ as this blog and the people posting in it, excluding myself.

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To the Guy with arse sown onto his head,

July 3rd, 2012 at 11:05 pm

Where did you reach this conclusion from ‘No dividend No tax involved’, the usual fart around you as always,
 
‘Why speculate then’
If the report hasn’t reached the inbox yet, why sit clueless when educate guess can be taken till the time facts come out, what do you do as market maker, wait for all the news to come out and then make market?
 
You sound just like you, up your arse, it’s not personal, it’s just your nature, go up barking up everybody’s leg, take it easy, life’s too short, no?
 
Who is booking trader bonuses as dividend in the accounts?
 
‘dividends must be paid out proportionally to ALL shareholders’ Have you ever heard of all shareholders not holding same amount of shares? Surely, you are the expert,
 
Its nonsense like above that kinda is inspiring to try come up with better material, not your usual sado macho half baked bs, enough of that already, what is curious is that for all your smarts you don’t really see all the nonsense you yourself are posting, talk about being up your own butthole so far up,
 
Yah?
 

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yah

July 4th, 2012 at 12:01 am

The annual report is out. Maybe it hasn’t reached your inbox, but most others appear to have a copy. Oh and by the way, I wouldn’t refer to your bs as “educated” guesses.

“‘dividends must be paid out proportionally to ALL shareholders’
Have you ever heard of all shareholders not holding same amount of shares?”
um yah…I think this is EXACTLY what the word proportionally is referring to. And for that reason it’s near impossible to jiggle bonus money to a dividend or vice versa without screwing a bunch of other shareholders.

Your point about a marble system was what??? That the company is paying out part of the 164m of salaries / bonuses as a veiled dividend to a select few for “tax purpose”? Another educated guess or simply clueless?

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anonymous

July 4th, 2012 at 12:59 am

‘but most others appear to have a copy’, how did you reach that conclusion, as usual fart around your arse face,
 
The educated guesses are pretty well in line, without the stupid report in the mail box, you can refer to these guesses as whatever you want to, you are the master of your domain,
 
‘it’s near impossible to jiggle bonus money to a dividend or vice’, well then you don’t know what you are talking about, so stop talking,
 
‘That the company is paying out part of the 164m of salaries / bonuses as a veiled dividend to a select few for “tax purpose”’ where do you come up with this nonsensical implications from simple possible scenarios, do you ever look at yourself in the mirror, it’s getting late, your brain is already woozy, get some sleep, if you want to still keep banging your head after a night’s sleep, then than be, well not totally unexpected, yah ?
 

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Heisenberg

July 4th, 2012 at 12:30 pm

Let’s keep the pseudo-intellectual masturbation to a minimum guys. This forum is for everyone, not just you two. Go out and get some fresh air.

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anonymous

July 4th, 2012 at 7:06 pm

seems like that guy got back to his senses after good night’s sleep, don’t know why people in this industry get such a strong urge to try putting other people down rather that putting yourself up,

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