Optiver. Big in Japan.
Last year has been a profitable year for Optiver. CEO Paul Hilgers, who took over the helm six months ago, reported a profit of € 174 million over 2013. That’s 23% more compared with previous year.
Trading revenue was up 26% to an impressive € 466 million. The expenses were up a few million as it hired more employees for IT, back office trade processing and administration
Outperforming rival IMC
Once again Optiver earned more than long term rival IMC, which saw a profit of €127 million and trading revenue of €403 million in the same period.
Big in Japan
Unfortunately there’s no annual report available just yet. Company decided to release the figures to a few newspapers before releasing the full report. Main comments in the FD was more than half of the profits come from outside the European Union.
Particularly Hong Kong and Japan have seen very good trading conditions. Due to the aggressive monetary policy of Shinzo Abe, the trading volumes in Japan doubled. Volumes in Europe and the US have been flat.
Company is about to expand in the US in other asset classes, but targets organic growth without acquisitions. This in contrast to IMC, which bought Goldman Sachs’s post on the floor of the New York Stock Exchange.
“Less than half”? Try 15% of global profit from the amsterdam office.
really, just 75 from amsterdam, that sounds pretty slow going, not surprising with all the lethargic euro zone types who find it ‘not nice’ to fire or be fired
I thought optiver changed the bonus pool so the office that earns the most gets the bigger bonuses? Surely now the Dutch are lagging they will change the policy
that doesn’t sound right, if you start giving different money to different offices, then the next step inevitably is different money to each individual employee and then final step is IMC 2, really optiver now aspires to be IMC, what did hilgers used to do in his previous life, some shitty bank and some shitty mm, didn’t take him very long to take optiver down that path
The Dutch are now regretting loading bonus payments on how each of Asia/usa/Europe performs
Don’t forget, it was all invented in Holland with Dutch knowledge and equipment and rolled out by them. As if the foreign offices suddenly deserve more because the money has been made in their time zone.
You’re not from optiver are you? All of the Aussie office’s software was developed there.
I think the Aussie office is outperforming because they have an in-house chef as opposed to a cheese sandwich with a glass of milk.
Big volumes in the Indian and Aussie indices this year.
Big volumes, big bull market, and suddenly everybody starts acting like geniuses
Sorry that’s, Big volumes, big bull market, and suddenly everybody starts acting like big geniuses
big volumes in Asia should mean good business for Tibra and eclipse as well. Same DNA after all.
well humans and chimps have very similar DNA too, doesn’t mean that one of them isn’t kept in zoos by the other one
What other asset class can Optiver expand into in the US?
use your head and fingers, they are already in rates, equities, fx and commodities, being otc they can’t get into credit or inflation, what is left then, empty PR releases, they can of-course start mm in cme property f&o, anybody on that shit by any chance
why is Optiver almost always ahead of IMC in terms of profits and trading revenues?
What is Optiver doing better in terms of:
– Business plan
– Culture
– Employees
– Technology
– Markets and trading algorithms
– Investments
Any comments?
probably get rid of the fat faster than anyone in the biz. No passengers allowed to stick around for long. Politics is crushed and not encouraged.
dunno about getting rid of the fat. Loyalty counts for a lot at Optiver, as long as you keep working hard you do not have to be a rock star. You are dead right about the politics though
Optiver has better technology than IMC, they are faster. Moreover, they are diversified in more markets and strategies compared to IMC.
you are all missing the point, if you have to look at an organization, you have to look at how individuals within it are incentivized, more specifically how’s the compensation determined, fortunately optiver had transparent and standardized payout structure, thus there is little point in backstabbing the guy next to you and individuals can wholly focus on growing the pie for everyone, this is in sharp contrast to IMC where backstabbing, jealousy and arbitrary payout is the norm, so much so that their ‘leaked bonus list’ became an issue, it’s hard to have cohesive team atmosphere with so much distrust floating in the office, contrasting to this, everyone knows everybody’s pay in optiver
closely related to individual compensation is capital allocation by management/shareholders, if you invest in technology the entire group can remain ahead of the competitors, they picked their niche and have done remarkably well in terms of ROE over a period of large cyclical and structural changes
firing deadwood is of course hygiene in this industry, it’s not a bloody competitive advantage, you are only as good as your last trade, if you can’t fire people, you might as well fire yourself, atleast that ways you would be doing your organization a huge favor
are you saying that the main difference is the culture?
Is it true tibra shut down their japan desk less than 2 years ago? are they making money like Imc and optiver anywhere?
tibra is hiring successful traders with >5 years relevant trading experience, >90% confidence interval of >2mio in p&l
no i am saying the main difference is individual compensation structure along with group capital allocation, did you read my post at all, how did you conclude culture as the main difference when culture is actually the end result of the actual main difference that is comp and capital
sorry that’s, tibra is hiring successful traders with >5 years relevant trading experience, >90% confidence interval of >2mio in p&l, wanting comp < 40% of their p&l after cost
@9:44 PM – Talk to Optiver traders and they’ll moan as much as traders at IMC about the lack of transparency regarding individual comp. It doesn’t matter where you look, every trader will gripe about the fact that their bonus is too dependent on the favor of their manager and how the other guys (all less deserving) got too much out of the kitty.
My analysis is that there’s a lot to be explained through the personality of the founders/CEOs and the economy of management attention.
RD’s spent years trying to grow IMC into something more than just market making/HFT. Just look at the number of activities IMC have deployed over the years and how long they tried to grow them (eg. O&E, Maxtor, etc. etc.)
JK’s been content to keep Optiver’s focus limited. Optiver tries out new stuff every now and again but they limit the number of things brewing. If things don’t work (eg ProBrokerage) they get axed. If they do work, they get spun out (TOM).
ah, when you say lack of transparency, do you mean that payout is arbitrary or do you mean that it’s not visible to other people or do you mean it’s too dependent on manager’s performance appraisal?
there is huge difference in the above three, if you don’t understand why, just ask
how many optiver and imc traders have you polled for your survey results?
As for favors with manager, well there’s bit of lottery of landing good manager and there’s lot of work required in having a fruitful working relationship, it’s not the most efficient system, but it’s the best you got for an organization, if you don’t want a boss, work in a arcade or start your own firm
pls don’t call your half-baked misplaced personal-ego driven opinions as ‘analysis’
how’s ‘personality of the founders/CEOs’ different from already stated ‘capital allocation by management/shareholders’, founders/ceo are of-course primary management/shareholders, organization’s capital allocation discussion is of-course driven by personality of primary management/shareholder
define ‘economy of management attention’
define ‘o&e, maxtor, etc, etc’
how’s ‘Optiver tries out new stuff every now and again but they limit the number of things brewing’ different from already stated ‘they picked their niche’
‘focus limited’ is of course negative cousin of ‘niche focus’
you got anything new, factual, not your opinion
Optiver doesn’t value its IT stuff in Amsterdam. A senior guy would get something like 60k base and then a tiny 10-15% bonus after the year. That’s just laughable. They are exploiting the fact that Dutch market pay is much more lower than in London or the US. A senior guy in London would be looking at something like 100-150k pounds just base.
that’s call running a business mate, you don’t hire your labour in the most expensive place possible, if they are getting good quality of people at reasonable price, why overpay?
if you find Optiver IT staff so cheap, why don’t you hire them, get rid of your current staff and save mios?
@11:09 Have you still not managed to burden yourself with any information, let alone knowledge?
you got some information or knowledge you need to unburden, feel free mate, just don’t feel welcome to unburden all your bs
It’s called dirty play. Walmart pays Indians so they barely survive and crams them thousands into a small hangar. You wouldn’t call it “running a business mate”, would you ?
if Optiver does not value IT staff, then we it has a better IT than IMC? Salaries are ok, London is also much more expensive than Amsterdam, especially private school… So at the end you are better off with a dutch IT salary than a london one.
the dutch IT pay being low is a crap statement already.
THe guy who built their fastest engine was paid more than most traders.
His protege was poached by guess who in London ?
Bull crap about much more expensive. The salary a senior IT guy would get in London would outweight any diff in expensiveness of these cities.
Moreover, every guy who doesn’t have 30% tax rule in Amsterdam is getting double screwed on dutch taxes, because UK tax is lower.
One guy doesn’t build a trading system. That’s a fait tale.
there is additional problem with higher salary/higher expense town called london, that there’s too much money floating around, extra 30-40k makes absolutely no difference to your own perceived wealth, you are constantly miserable looking at other wealthy people and always comparing your dick size with the next guy in the tube
now contrast this to happy dutch village called amsterdam, people riding around in their non-assuming bikes, being cheap around town is a national hobby, that less base salary goes much longer way than a londoner could ever imagine
if the above is in any doubt, you just need to read the comments above, the macho london guy is dead-focused on showing off his big bucks and big swinging dick while the satisfied dutch guy is ecstatically supporting his winning football team, go orange!
London Guy, how are you holding up, already preparing for another thrashing in two years time?
It’s not called dirty play, it’s called capitalism. Walmart pays employees federal minimum wages. If employees don’t like it they are free to find a job at their local Starbucks.
It’s of-course “running a business mate”, the owners are one of the richest families in America; one of their biggest shareholders, Buffet, also happens to be one of the most generous guy in America; what more do you want; they are not running a charity and they are definitely not breaking any laws
they are competing with likes of other super-competitive discount retailers and amazon; on supply side there is plenty labor available; if you are going to overpay, how would you compete with 2.5bn indian+chinese people hungry to steal any jobs they can
Optiver can pay their devs whatever they want. Whether they’ll attract anyone good is another question.
@ 11:41 pm
you seem to opened up a wrong website mate. are you sure you’re not after greenpeace.com or some other socialist non-sense ?
people come to trading business to make money and not ride a rusty old dutch bicycle.
quality of life and entertainment in amsterdam is much better than in london
60k in Amsterdam sounds a bit disappointing. This is what you can make in Germany working in the industry… programming washing machines. ok, with a bit of luck, but still, 60k is the average in IT; I would have expected more for such glamour work, like HFT.
if you expected more for the ‘glamour work’, maybe it’s not actually the ‘glamour work’ for the programmer slaving away
why are you confusing realistic salary perception in ldn vs ams as greenpeace/socialist bs, the post didn’t say which is better, it just said that if you are happy comparing dick size, live in ldn, otherwise be happy and content in ams, just to remind you, holland might have more social back-stop and higher taxes but it’s not in any shape a soviet style socialist bs you are refering to
as for riding rusty dutch bike, well if you are already used to comparing your flashy car in london, of course you wouldn’t start riding in bike all of sudden, but that’s not the case in ams at all, people are happy with their cheap non-flashy lifestyle, and thus lower salary goes long way, wealth/health/happiness is all relative mate, you look at the next guy and decide how wealthy/healthy/happy you feel for the day, the point
as for optiver’s ability to attract good devs on non-flashy salaries, well there’s no way to reach on any conclusion on that, their bottom line looks healthy for now so they are probably not too bad at it
define “big in Japan”
http://bit.ly/VlRr4J
thanks for the help
define “let me google that for you”
I just wonder how long does a dev with 60k remain at optiver…
http://bit.ly/1j2tzgT
60k dev remains at optiver as long as other alternative (comp+team quality+work quality+work-life balance) is not materially better, duh
@duh two years and the average Joep is gone? to London?
how did you calculate
reduction in work-life balance+reduction in living condition+reduction in perceived salary < extra ldn comp
for each 60k ams dev?
london guy is putting his london style big bucks analysis on average Joep from a happy village, typical self-involved ego bubble ‘analysis’
@ 11.49pm
If you look up teh internet, it’s full of stories how Walmart employes children and pays well beyond min salary in third world countries. And they don’t give a damn about it. Ofc they obey all laws on their home turf otherwise they would be bust.
Same thing with optiver. It imports low value labor from third world countries and pays them peanuts in HFT world. I’m not saying it is bad, but it is not good either.
Obviously we are in the market economy and if people know there is a better pay in London they will move. That was the case back in the days btw, optiver had a high turnover of stuff. Maybe still has.
London is not that more expensive than Amsterdam if you take an average Joep who doesn’t have 30% tax rule advantage.
again, walmart is not breaking laws, in sub-continent there is extreme poverty, people have kids to have more help, same goes for population explosion in nigeria and muslim land where contraception is not used for religious reasons, you are attacking the wrong source, the main problem is illiteracy and mis-guided religious beliefs, walmart is not the bloody problem, live in a third coutry before you start trying to save it from stupid walmart
why is not good to import cheap labor? it’s good for the company to improve their margins, it’s good for labor who don’t have to live in a bloody third world country, it’s a global economy, it’s pretty good for everyone and not just for ovarian lottery winner, just ask any imported cheap labor if they wanna return back to their hell-hole
there are rumors that Source Capital is starting a new hedge fund under a mysterious name in London and in parallel downsizing high-frequency trading in Switzerland.
smart move, there isn’t as much pnl to be had in high freq with so much competition against successful competitors, swizz is expensive too with lesser talent pool, prop arcade in london is their only hope, though good prop punters aren’t in huge supply as was the case before and the competition for them should be reasonably high given other arcades around town
swiss has 0 taxes on capital gains for individuals..I would rather be employed in CH than UK for the same net salary
not sure this is such a smart idea, that’s what everybody else is trying to do…but different types of trading strategies will be needed for an hedge fund. The results will speak by themselves soon.
Any idea on who is the capital provider and the people involved?
sorry, could you repeat your reasoning behind why it’s not smart idea?
you say, everybody else is trying to do, so it’s not smart idea, well everybody else is trying to do hi-freq too, then they shouldn’t have been in existing business at all?
you say, different types of trading strategies will be needed for an hedge fund, so it’s not smart idea, well you need different types of trading strategies in hi-freq too, they they shouldn’t have been in existing business at all?
by 0% tax logic, everyone in uk would have moved to ch by now?
you can make more than 60k in the netherlands by working in risk or (completely unrelated) cyber security. 38 hours and there is less competition from eastern europeans with 30% ruling.
Not that it matters because because for every euro you lose 52% on income tax, car tax garbage tax water tax pleasure tax etc.
The only way is to get out (e.g. fuck the Dutch)
and go where, ldn? man how many times this needs to be repeated, endless running around with awful working hours and constantly feeling poor compared to other rich people is not fun either, where to next
Indeed. Ldn sucks balls. Fantastic city to visit for a long weekend. Depressing horrible city to live and work in. Alternatives? Frankfurt is crap and doesnt feature much Hft. At least Amsterdam and ch offer reasonable quality of life but Dutch taxes are cruel and the opportunities in hft is relatively limited in ch. a Few american hft shops are in dublin but top end income tax is punishing too and half of dublin is rough as hell.
define ‘clown guy’
Jack: can you auto-delete any post that starts with “define” ?
Q. How do you tell if a plane is full of traders after bono time?
A. It keeps on whining even after all the engines have failed.
Jack: can you auto-delete any post that starts with a completely retarded request?
define ‘completely retarded request’
I am going to auto-delete both you muppets, now kiss n make-up, imc style
What happened to game changers at Tibra ? Did they ear millions?
do the elbow grease in ldn, save some money and live from it like a king in Central Europe like Budapest, build your company and hire bright-eyed talent, have fun with friendly ladies who look like ladies, enjoy sun and wine and sailing at Lake Balaton, etc… etc… 😉
citi has got large presence there, better than other shitty off-shores like bournemouth, j’berg, mumbai etc
any preference, prague vs budapest?
bud as an expat, prague for a visit as tourist. Prague is prettier, Bud is livelier.
how abt kiev, apart from mr putin
with hilgers at the helm i am tipping optiver to make 1 billion plus this year
and what would you do if they only made half of that?
why kiev, as you say, there’s a certain gaspadin putin ruining it. Why not same country, couple of km away, there’s cernobyl, you don’t have to worry about putin there.
PRague works well for 5y already
do reccomend
how’s ease of using English in legal and business affairs?
with defares and his yes men at the helm i am tipping imc to make 100 mio minus this year
haha, people have been hoping and praying for the same for years, get real, imc is well and alive, and here to stay, all you gloom predictors should get on with their own miserable lives instead and not live in the past
any chance optiver will give american traders the same annual leave now they are pulling their weight?
yes, if those traders migrate to another office where the competition for them offers the same, you see you are comparing apple to oranges, you have to compare traders in chicago with other traders in chicago, not traders in amsterdam
But the Dutch get 6 weeks when they transfer to Oz.
Didn’t the Dutch deserve to win? Why did they not chose the good goalie?
in trading, it’s called ‘you get what you want’, such schoolboy errors with no krul and no huntelaar to open penalties, to top it all, what was sneijder in such big hurry to take the bloody penalty, vladi vla
still can beat brazil 3-0
prague ‘n english – no issues at all
especially in trading business
smooth 😉
The Dutch are useless and complain all the time. Glad they lost to a bankrupt country. Stop whining and act like adults.
Oh happy days. Go Getmany!
having lots of money or lack of it is, but one contributing criteria to soccer success, if Argentina wins world cup, would that imply all the money in the rest of world couldn’t stop this bankrupt group of people?
how is use of english in budapest and kiev, for legal and business use?
afaik budapest is ok
no idea on kiev
‘Volumes in EU and US have been flat’ ? Try drop of over 50% in Eurex volumes
what do you expect with low volatility, slow growth and debt overhang, why would people go around trading back n forth and create volume for mm to scalp
anonymous
July 10th, 2014 at 12:45 am
in trading, it’s called ‘you get what you want’, such schoolboy errors with no krul and no huntelaar to open penalties, to top it all, what was sneijder in such big hurry to take the bloody penalty, vladi vla
still can beat brazil 3-0
Congratulations to Germany, they deserved it!
they are probably the only country you can can convincingly bet on but feel little emotion on their actual victory, yes, they definitely deserved it!
hft is long forgotten now, when is virtu coming to market
What people say about recent GTS expansion in London ? Are they any good ?
Glassdoor lists that company as HFT arcade.
weblink pls
Big year for in Asia Pacific again for 2014.
throw some numbers, absolute and year-on-year
6 month revenues crossed last years rev.
how much was last year’s rev?