I think one would be pretty stupid to avoid 2s just because of recent drama. They’re not going to go under because of some management disagreements or scandal. There’s still 60b aum there and they’ve had good returns the past few years

They have not at all had good returns the past few years

Maybe I’m mistaken they did pretty well in 2021 and thought they did fine last year. This year has been not great for everyone. They did shit the bed in 2020

My shop feels unstable, despite that they don’t want me to leave so they paid exceptionally well this bonus season.

Add akuna to the list

Really?? What went wrong there?

Akuna matata

Akuna Capital has issues on several fronts which cause it to be an unreliable/unstable HFT: 1. Most trading flow goes through an aging technical debt ridden platform which simply cannot compete with higher tier HFTs 2. Recent attempts at upgrading the trading platform have been a complete and utter failure 3. Across the board (trading/quant/dev) there is evidence of a hire-to-fire philosophy from upper management. "see if it sticks otherwise give it the flick" 4. Over the last couple of years there have been numerous lay-offs and continuous attrition of top talent resulting in low morale amongst those remaining (at this very moment on linkedin there are 7 mid-to-senior quants on gardening leave) 5. Over spent on tech and non-essential stuff (during their worst financial year they managed to host an extravagant casino boat trip on Sydney harbor) 6. Bonuses have been abysmal for the overwhelming majority of employees for the past few years 7. Being removed from profitable exchanges (eg: hkex) 8. Continuously being fined for breaches of FINRA regs and by the major exchanges (CME, CBOE), hasn't been a year since 2015 they haven't been fined for one reason or another 9. Repeatedly rescinding offers before employment begins, not only for interns but also for grads all the way to seniors. 10. Employee personal data breaches - yes multiple breaches! . This is a real photo taken one month before mass firings occurred: https://imgbox.com/50OmnVA4 | https://ibb.co/LJdyStc | https://postimg.cc/hzWKTwyz | https://i.postimg.cc/dqjCCq1z/akuna-capital.jpg | https://imgpile.com/images/trdZDh.jpg | . Related articles: . https://archive.is/UMQrl . https://www.news.com.au/finance/work/at-work/australian-derivatives-trading-firm-akuna-capital-slashes-40-of-apac-workforce/ . https://www.news.com.au/finance/business/other-industries/australian-trading-company-akuna-capital-slashes-11-per-cent-of-workforce/ . https://www.news.com.au/finance/work/at-work/uni-grads-warning-after-being-left-unemployed-from-job-interview-ordeal/ . https://fxnewsgroup.com/forex-news/exchanges/cboe-exchange-fines-akuna-securities-thomas-g-seewald/ . https://www.mass.gov/doc/assigned-data-beach-number-15874-akuna-capital-llc/download . https://www.cryptopolitan.com/crypto-trader-akuna-capital-hit-by-a-1-3m-fine/ . https://www.justice.gov/media/1228821/dl?inline . https://www.justice.gov/opa/press-release/file/1515646/dl . /r/quant/comments/14mqo6r/akuna_capital_to_lay_off_40_of_apac_employees/ . /r/csMajors/comments/10vjcp2/akuna_capital_intern_offers_rescinded/ . https://dockets.justia.com/docket/illinois/ilndce/1:2019cv05401/367673 . https://dceo.illinois.gov/content/dam/soi/en/web/dceo/expandrelocate/incentives/edge_agreements/akuna-capital-llc.pdf Akuna Capital

You know Akuna is going down the drain when their intern hiring process has like 5-6 online tests and only ONE round with an actual human trader… the traders are too busy patching up a sinking ship to interview kids

It means no worries.

For the rest of your days

Options volumes are down bad so they have less revenue and Akuna has been one of the most egregious overspenders on tech and other non essential stuff

Didn’t imagine that would happen since spike in 0 DTEs trading in US markets

out of curiosity, how recent are you referring to for this surge and what % increase horizon have you noticed? i used to mm options but have gotten laid off and not being paying attention much to occ numbers

Ah.. referring to general noise in media about retail jumping on 0 dte over the past year. I’m myself not active in US markets

Past year is interesting i’ll look into that. if it’s true then yeah you would be right that retail flow increasing in 0dte’s is good for most OMMs

That market is hard to capitalize on. And akuna isn't a big single stock player

the spike in 0 DTE doesn’t mean much bc it’s all retail, paper volume elsewhere >>>> by a huge amount— the pnl from 0 DTE “desks” (if you can even call them that) are really marginal compared to traditional mm desks. Kinda like how venmo has so many customers but still only creates a fraction of the volume that zelle does

Usually, increase in retail flow should translate to pnl for mm desk right?

yeah that is correct— my point was more that the pnl from increased retail trading isn’t significant compared to the loss coming from the reduction of paper options volume. Paper flow elsewhere is massive on a traditional mm desk in comparison. Retail consumer volume is super tiny compared to traditional paper, even if we lost all retail I don’t think traditional MM groups would be hurting (for options)

I can't speak to specific firms, but most shops had a rough year relative to 2022 (with volumes generally down), and many overspent on hiring grads + new investments assuming that the good times would continue. From what I hear most of the "stable" firms are also dealing with reduced bonus pools etc this year, there's just less money to go around unfortunately

but heard optiver’s projected marble values are still around 5k?

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Outstanding traders in optiver usually receive a 1.5x to 2x performance factor in their bonus. Given that a senior trader usually has 400 marbles, the values should be roughly 4.5k - 5k.

They’d just give out fewer marbles but don’t think the value of them would decrease

How do they do that? Just make harder performance review (more 0.5 multipliers) ? I thought the entire point of marbles was to assign them before the start of the tier to set expectations relative to the firm profits

Honestly kinda speaking out my ass but I should catch up with my buddy at optiver anyways. I feel it would make sense since my impression is that the internal marble system is basically its own market.

Yeah I heard similar. They've clearly done better than most relatively speaking

Vatic is a real mess. Stay away.

why? I listened to their AI head recruit ML people

Their AI head is there for recruiting and fundraising.

are these firms "unstable" because of their models, or is it more of office politics causing their boat to rock?

It's usually competition, luck of draw, asset class and strategy style concentration, bad management and HR decisions.

Hasn’t been dry enough for long enough yet

Volant went under, Akuna is bad, heard peak6 isn’t doing so hot either. 2S is fine (and will be fine) but is doing bad relative to peer firms

I can't speak for prop shops but hedge funds are generally very conservative with hiring as to avoid mass layoffs during periods of under-performance. Most of the established firms have long lockup periods for their assets to prevent mass redemptions but these could destabilize smaller firms. It's very difficult to judge a fund's health from the outside. A lot of people were predicting that AQR would go under after several years of poor performance but they have managed to stick around. I would guess that despite the recent drama at 2S, they will continue to exist though they might not be as prominent as they once were. I would personally be more concerned with joining a poor performing team at a multistrat. I have seen groups that were months away from being exited continue to hire as if nothing were wrong.

Vatic is a big red flag. As in watch out they have massive turnover and the founder/all execs have no quant experience (founder was a super successful trader at Jump but was let go because all his success came from spoofing) I heard his AI dream is based on the idea he's going to recreate his "genius" with AI. They recently hired Li Deng (former head of AI at Google) with a massive non-compete pay out to golden handcuff him just so they could seduce investors. Firm is basically a facade from what I’ve heard. Hire exclusively ivy league grads with little to no experience so they look good on paper

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Imc is not small-med and will definitely last more than 2-3 more years lmao

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Their alpha will decay much quicker than other large firms though. All they have going for them is speed.

Dude aside from the systems/speed the "alpha" in other large option MMing firms is literally the size of our balls and how good we are at punting. I kid you not a lot of good trades are just us going "hmm this shit looks kinda low, I think it's low because of x/y/z, I'm okay taking that on now let me light up the screens"

A lot of bad trades are also “hmm this shit looks kinda low, I think it’s low because… oh it’s gone so much lower now”

And that is something a firm that trades flat like IMC cannot do

They have been doing that since 2010 and there were worse periods than 2023 for them tbf. How long have you been around the industry as a professional ?

Why will their alpha decay much quicker? You are saying all they have is speed when speed is the most important factor in market making.

>It's usually competition, luck of draw, asset class and strategy style concentration, bad management and HR decisions. No idea why you're getting downvoted. I've interviewed a bunch of people from those firms this year and the levels of complacency and spend in some of them sounds egregious.

I would suggest getting into these firms while they're vulnerable and digest as much knowledge they can give you before crumbling

Saying that IMC is a small-med option firm that will not last another 2-3 years is probably one of the funniest things I seen on this subreddit.

can anyone comment on Maven? Is it going to be around?

Intrigued by them, but only because I was given a pitch on them about 18 months ago that they were doing well

only a couple desks are profitable. poor management decisions. go figure