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It's naive to imagine there aren't funds on both sides of this behavior.
by lvs 6y ago
It's naive to imagine there aren't funds on both sides of this behavior.
- ipnon 6y agoHedge funds don't need to use NLP to gauge retail interest in certain stocks, Robinhood just sells their order books directly to the highest bidder.
- mrRandomGuy 6y agoNot sure why you're getting down voted, when the article makes clear to mention that Citadel does have the order flow information, and actually insinuates the same thing...
- TYPE_FASTER 6y agoYes. https://twitter.com/toxic/status/1353890766800621569 https://twitter.com/toxic/status/1353890766800621569
- skateris 6y agoNo Citadel can't just 'choose to front run' some RH trades. They are obligated to always execute at NBBO https://en.wikipedia.org/wiki/National_best_bid_and_offer https://en.wikipedia.org/wiki/National_best_bid_and_offer They don't need to frontrun they'll clean up just from providing liquidity with the huge volatility in the symbol. Citadel is split into Citadel Securities (the market making org which pays for orderflow) and the Citadel the hedge fund. The two halves of the business can't coordinate/share position info (or order flow info like others have implied). If they did they'd get absolutely demolished by the SEC. There is really no reason for them to do that though since they're already printing money from MMing.
- TYPE_FASTER 6y agoTIL, thank you!