ConvergEx offers new risk controls to liquidity providers
10 August 2015 New York
Image: Shutterstock
ConvergEx, an agency-focused global brokerage and trading services provider, has launched its new Capital Commitment Crossing Algorithm for options facilitation trading.
The algorithm, which went live on 5 August, offers liquidity providers greater control when managing exposure when facilitating block trades for their options clients.
Liquidity providers can use the Capital Commitment Algorithm to customise their interaction with the marketplace by analysing factors such as the price committed to customers and the liquidity providers’ existing positions or capital constraints.
The Capital Commitment Crossing Algorithm offers two different ‘touch rate’ paths, known as CapMax and CapMin, for liquidity providers to manage how much of a given block trade they internalise.
CapMax allows traders to sweep all protected quotes before facilitating the balance of a block order at one or more exchange auctions.
CapMin, meanwhile, utilises ConvergEx’s Pulse options algorithm to source maximum liquidity from the open market before facilitating the balance of the block order.
Ben Londergan, ConvergEx executive managing director and head of options trading and technology, said: “This cutting-edge algorithm allows institutional desks to put up their customer facilitation options trades electronically with a new level of customisation.”
The algorithm, which went live on 5 August, offers liquidity providers greater control when managing exposure when facilitating block trades for their options clients.
Liquidity providers can use the Capital Commitment Algorithm to customise their interaction with the marketplace by analysing factors such as the price committed to customers and the liquidity providers’ existing positions or capital constraints.
The Capital Commitment Crossing Algorithm offers two different ‘touch rate’ paths, known as CapMax and CapMin, for liquidity providers to manage how much of a given block trade they internalise.
CapMax allows traders to sweep all protected quotes before facilitating the balance of a block order at one or more exchange auctions.
CapMin, meanwhile, utilises ConvergEx’s Pulse options algorithm to source maximum liquidity from the open market before facilitating the balance of the block order.
Ben Londergan, ConvergEx executive managing director and head of options trading and technology, said: “This cutting-edge algorithm allows institutional desks to put up their customer facilitation options trades electronically with a new level of customisation.”
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