4 ms·
Authorized participants arbitrage all day, if they see dislocation they can certainly hold on to certain names.
by jonknee 7y ago
Authorized participants arbitrage all day, if they see dislocation they can certainly hold on to certain names.
- rocqua 7y agoArbitrage (as done by APs) is mostly about gathering an instantaneous spread. Much like market makers, that strategy is not about holding a position.
- jonknee 7y agoYes, but strategies change in a crash. It's possible no one learned from the 2015 flash crash, but I bet a lot of smart funds out there are ready for one. If a dumb AP is going to put out a crazy price someone is going to be there to snap it up.