DRW buys Chopper
Pretty big news from the other side of the Atlantic. High speed trading firm DRW Trading has bought smaller rival Chopper Trading. DRW is a giant in the high frequency industry and one of the largest prop trading firms in the Chicago – and the world.
A few years ago the firm, founded by legendary trader Donald R. Wilson (“DRW”), came in conflict over interest options with the CFTC. And from my perspective, they are right.
If you want loyalty, buy a dog
DRW is founded in 1992 and employs some 500 people – with offices around the world. Chopper Trading is smaller (200 employees) and younger. Raj Fernando founded the firm in 2002. Instead of his initials, he has chosen to name his firm after his dog. And well, Don Wilson buys it.
Financial details of the merger haven’t been released.
Bad sign for Chopper
These kind of deals between trading firms aren’t very common, and when they do : it usually isn’t a good sign. At least one of the newly weds is often begging to be saved. Another era, but I remember Saen Options (2009). More recently, Knight Trading wasn’t in perfect shape either.
In this case, Chopper approached DRW. Another sign of trouble for Chopper was the decision a few months ago (November 2014) to shut down the European trading operations. Regulatory burden, sure – but only a burden amidst disappointing results. A year earlier Chopper has been fined by the CME. A tiny $20.000 for excessive orders on the E-Mini Dow futures on Globex on two occasions.
But that’s just speculation. Maybe some shareholders in Chopper felt like gardening and decided to cash out. Or spend more time on charity. Saving animals. Maybe. This Raj Fernando is serious about taking care of dogs by the way. I like this guy.
- Some background on Crain’s
Maybe Raj is just freeing himself up to help out for Hillary’s presidential run
http://abcnews.go.com/Blotter/obama-clinton-fundraiser-rajiv-fernando-appointed-national-security/story?id=17153449&singlePage=true
I’m wondering if the move in bonds on Oct 15th had anything to do w/this?
There was an unsubstantiated rumor that a different trading firm, which has been around for many years and will go unnamed here, had it’s worst losses ever that day. Articles note that Chopper had focus in the Treasury market and so I wonder if they got hurt the same? The timing makes me curious but it’s just a wild guess on my part.
Who and when buys Tibra ?
Senior Traders with 5 years relevant trading experience buy out Tibra since they are such good traders to begin with
why does the trading firm having rumours of large losses on oct15 go unnamed, it’s like massage with no happy ending, wat was the point of dropping the bloody hint in the first place, duh?
Raj (Rajiv) Fernando would be perfect for chief of staff la Josh (Joshua) Lyman in Lady Bartlet’s administration, talk about shameless plutocracy and nepotism
wasn’t some moron just complaining about ‘nothing new, this blog is dead’
I don’t know how Chopper did on Oct 15, but they were performing poorly before that.
Any hedge funds toast on the EURCHF?
no buy side risk manager would let the book sit short chf upside optionality, any half decent stress test would pick it up in about 2 minutes, what are the pnl numbers on the street, any sell side long this move?
Criterion may have not survived the
move..
hmm.. 10% drop on expiry in SMI is pretty bad. but I doubt the would’ve lost it on that… so it would’ve been on other stocks? Can’t imagine those guys would’ve be slack with their risk since MM would’ve covered for that… at least the Critrerion guys as far as I know them
As usual the downside kings optiver and Imc made moolah
rumors are of a serious casualty in Amsterdam
tell us all about it, henk
I would certainly expect the HI-Q Market Neutral Fund to have kept a large standing bid at 1.199999999.
I am client at hiq, i called them and according to them they are not hit by the move. For sure by other things the last couple of months, but not by this one.
rumor has it van der moolen did not survive the chf move and is facing bankruptcy
source cap was badly hit, itay freaked out
the little man is a control freak on a sinking boat he lost control of
if after black swan book, people are getting wiped out by white swans, then it’s nothing less than a shocking display of stupidity and at worse lack of respect for the history
Yeah HIQ was down in 2014 with -15% (absolute return, not relative..)
what were the main drivers of the drawdown, what was the size of the fund at the time?
rumor is source cap is giving up on prop trading and will focus exclusively on agency trading, moving their HQ to London. Probably under an other fiscal entity, in the desperate attempt to hide their bad reputation in the industry.
the whole industry has got a bad reputation, theirs is none worse than the next guy
Whats happened at Ronin Singapore?
what did you hear?
Yeah, what about Ronin Singapore?
who cares, next
Word is Joop moved his Optiver payout cash in CHF and leveraged up. He now has a billion just like Hilgers
check out my firms new website
old: http://www.akunacapital.com
new: http://www.akunaholdings.com/
good for Killion
You mean good for Killer
is that what hep kids call him?
https://www.linkedin.com/pub/andrew-killion/54/68/a3a
Yah. The two head honchos : killer and skinner.
In other US news, the boss of Allston is off to Goldman:
http://www.bloomberg.com/news/2015-01-21/goldman-hires-allston-trading-s-mahajan-as-equities-partner-2-.html
May be another takeover coming – word has it IMC may be picking up Allston
wow those are some cool nicks, did the hardy boys came up with those all by themselves?
imc, allston, all those kids from mother goldman
imc, flow, tibra, akuna are all from mother optiver
Are Tibra still in business?
optiver must have been fucked badly to give birth to imc, what’s the legend there?
IMC does not originate from Optiver, that’s Tibra. Both IMC and Optiver are doing very well since vola and volumes are up.
wow that’s a shockingly fresh insight to the mm business
akunaholdings.com just reverts to akunacapital.com…
If so, then looks like Akuna just setup a honeypot to see who visits from this website
yes, that’s why they did that, next
Big day for alloptions!!
may it rest in peace?
Allston pulls out of US equities
http://mobile.bloomberg.com/news/2015-01-23/chicago-speed-trader-allston-withdraws-from-u-s-stock-market.html#articleCommentsModule
didn’t this come out like two days ago?
are the comments blocked for the new article “Den Drijver and Kroon walk”
Raj and Don Wilson used to work together as pit traders back in the day. It seems that Chopper and the profit margins were almost nil and it was really only one or two groups that DRW wanted out of the whole firm. Raj sold it for a song.
define song
quickly and for very little in order to cover chopper’s distressed assets.
how did end up being distressed, oil explorers?
bad management
at Chopper?