Articles & Reports

 

Articles

• How fast is fast enough?

  Understanding the challenges of latency for market makers

  One of the most important features of any market making system is performance. For market makers on CME, one of the world’s most liquid markets, employing performant technology has long been of particular importance for running a successful business. Rapid advancements in technology, both on the exchange and the participant side, have driven a latency race that has put increased pressure on market makers over the last few years.

  All market participants agree on the importance of latency, and discussions on the topic frequently appear in the media. However, it is not always clear why latency is important to market makers, which general measures can be taken to decrease latency and what low latency is worth. In this article, we take a closer look at these topics.
  

• The evolution of sponsored access

  Sponsored access has become important to traders and brokers alike. In this interview with Jesper Alfredsson, VP of Product Management at Orc, learn more about sponsored access and how it’s impacting trading.

• Statistical Arbitrage: Low-latency automation of complex trading strategies

  Recent developments in high frequency trading and more specifically statistical arbitrage increase demand for capable technology. Traders not only need to automate complex trading algorithms but also to have them executed within microseconds.

• Improving trading performance - Get the right information from your trading screen

  Orc Trading 9 offers numerous enhancements to improve a trader's performance. In this article, Akira Yamaguchi, Product Manager at Orc Software, discusses new features in Orc Trading built with the input of the trading community.

• Opportunities in Brazil- Taking Advantage of a Growing Market

  Brazil is growing and proprietary trading is becoming more viable for both local traders as well as overseas traders. In this article, Ruben Guerrero, Strategic Partnership Manager for Orc Software, discusses what challenges traders face when looking at this important market.

• High Frequency Arbitrage and Spread Trading

  High frequency trading has become a major force in electronic trading around the world. In this article Markus Kämpe, Senior Product Manager at Orc Software, looks at fundamentals, execution risk and new opportunities in arbitrage and spread trading, two significant segments within high frequency trading.
  

• Index Options Market Making - Staying competitive in today’s markets

  Orc Software examines the criteria for profitable market making on the major European index options markets. Senior Product Manager Markus Kämpe describes key needs in competitive index options market making; looks at challenges and key success factors in the most liquid European index options products and identifies how market advancements are placing new requirements on market making software solutions.

• Exchange spotlight – CME FX options trading

  Orc Software examines the opportunities seen by trading firms globally to participate in the FX options segment at CME; and looks at market requirements and key differentiators. Marketing Director Christine Blinke gets the latest market developments from Craig LeVeille, Director FX Products at CME Group, and explores the requirements from participating trading firms with insight provided by Markus Kämpe, Senior Product Manager at Orc Software.
  

• Arbitrageurs in search of Golden Opportunities

  Orc Software examines the criteria for profitable arbitrage trading on Gold derivatives markets. Chief Marketing Officer Annie Walsh taps market insight from Senior Product Manager Markus Kämpe to define the underpinning technology required to turn profits.

• The make or break of European ETFs

  Orc Software examines the European ETF market; looks at current market requirements and key differentiators. Marketing Director Christine Blinke gets the latest trends and future predictions of the European ETF market from Lee Griggs, Managing Director and VP Sales Orc UK, and Senior Product Manager Markus Kämpe.

• Exchanges Splitting Interfaces Coping with Data Masses: The Exchanges’ Side

  With the exponential rise of electronic and automated trading around the world over the past thirty or so years, accurately predicting what the future holds might be akin to a futile exercise. But one thing is clear: the global trend towards machine-based trading is forcing many exchanges to upgrade their IT infrastructures and gateways, to handle booming trade and market data with increasingly lower latency. This article looks at the challenges the exchanges are facing with insight provided by Martin Zwick, Managing Director at Orc Software GmbH in Frankfurt.
  

• Orc Software Addresses Pricing Framework Shortcomings for Short-term Interest Rate (STIR) Options

  Traders reacting to latest market volatility and looking for an advanced pricing framework to model Eurodollar options and other short-term interest rate (STIR) products are migrating to Orc Software’s Normal Distribution Model. This article looks at why customer requirements are changing with insight provided by Orc Software Senior Product Manager and volatility specialist, Markus Kämpe. Edited by Annie Walsh, Orc Software’s Chief Marketing Officer.

• Futures Spreading – Challenges and Opportunities in Volatile Times

  The 2008 global financial shake-up will certainly be one for the record books. Market swings of 5-10 percent became almost a daily norm with traders and asset managers alike prompting a “flight to safety” as institutions failed or went into administration. Trading suddenly made news, as investors sought to make sense of what is now known as a “global financial crisis.” Traders found themselves facing surges in volatility many industry insiders never imagined. Spread across all asset classes, volatility in 2008 left financial instruments in positions that clearly required sophisticated trading tools to stay ahead.
   
  Orc Software Product Manager, Per Haglund, discusses the key issues in futures spread trading and how Orc is helping firms to take advantage of market opportunities.
  

• Crossing Over, What Matters Most in FIX

  While many of the primary users of FIX have significantly helped to propagate the standard worldwide, this has been uncharted territory with many switching engines over time. Orc Software looks at the path to FIX migration, and interviews Edward Strauss, Head of Sales and Electronic Trading for Baader Bank.

• Risky Business - the Importance of Understanding Your Trading Risk

  Orc Software explores the area of risk management for trading amid heightened market volatility. It looks specifically at the importance of an effective pricing framework to underpin risk analysis; includes interview with Orc Software risk specialist, Markus Kämpe. Edited by Orc Software CMO, Annie Walsh.

• The Rise of Volatility Trading

  Orc examines increasing market swing towards volatility trading; looks at current requirements and key differentiators.
  

• Structured Products Gain Traction in Eastern European Markets

  The Eastern European financial markets are increasingly looking beyond equities and other “plain vanilla” investment products. As markets mature, a move to more sophisticated investment products follows quite naturally. The current economic unrest has accelerated this trend. Trading in warrants, certificates and other structured products is now growing rapidly across Continental and Eastern Europe. From this follows an increasing need for technology to support ‘financial engineering’.
  

• Spotlight interview with Annelie Ek Krepp - Customer Account Manager for Orc Software

  Based in Orc Software’s London office, Annelie Ek Krepp has been employed by Orc for nearly 10 years, focusing specifically as key account manager for Orc’s large global investment banking customers over the past three years. During this time, Annelie has been closely involved with the expansion of Orc’s customer-focused services, reflecting today a more mature global IT company that continuously works with its customers to meet their increasing market requirements.
  

Reports

• TABB Group Report

  Trying to Make Change: Market Makers and the Evolving Options Market
  By Andy Nybo, TABB Group

  Excerpt:
  The U.S. options market is a radically different marketplace than existed a few short years ago. Volume is soaring as volatility flirts with levels not seen since the early 2000s. Regulatory initiatives and new technologies are causing structural shifts in the way options are traded, and the resulting changes in investor behavior are indelibly altering the options trading landscape, especially for options market makers that have long been an integral part of the market.

• US Options Market Makers Report

  Options Network Report 2009 by Markets Media
   
  Markets Media offers a unique and comprehensive look at the market making community and its impact on the larger marketplace, particularly the institutional investing community. Options Network is an indispensable resource for all market participants who rely on market makers, those who seek to do business with them and those who just want to understand their role in the marketplace.