"TOM wants the opposite of a monopoly"

Binck and Optiver announced the introduction of their joint venture a week ago. Actually, both companies didn’t want to burn their fingers on this apparently legal deal to corner the market.They decided to hire a professional in selling the impossible message. Enter the public relations firm Carl Byoir & Associates. When you need an external public relations officer to explain what you’re doing, you are hiding something. And indeed, The Order Machine (TOM) could need to a professional to explain what Optiver’s hand is doing in Binck’s cookie jar.

TOM Does not look good

• “Yes, it is a monopoly for Optiver.. but it’s only for two years!”
• “We did not involve any other market maker.. because it may take time!”

Of course it could eventually turn out well for the market. If the other professional market participants survive an absent retail order flow for two years, they will be invited as well in The Order Machine. However, they will have to play catch up with Optiver which has been optimizing their trading software for dealing with the new market. Or the other way around, they could make TOM to fit nicely to dealing with Optiver’s proprietary trading systems.

Nobody trusts Optiver

It doesn’t look good and firms like All Options remain openly critical in the press. Nobody trusts Optiver as operator of the exchange. Perhaps the Association of Proprietary Traders (APT) will discuss the matter on their next meeting in September (check out the slick website, in Dutch).