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Extended Version: How Jane Street Generates Alpha

In this 62-page, 43-exhibit case study that was inspired by the Securities and Exchange Board of India (SEBI), Alphacution assembles a tapestry of clues, anecdotes, data, and third-party research - on top of its own primary research library dedicated to market topology and macrostructure - to build upon SEBI's analysis and deliver our unique "wide lens" view of Jane Street Group's core trading strategy. Much bigger than one distinct trading strategy, this is a story with an evolving landscape, extraordinary...

By Paul Rowady | March 25, 2026 | Premium

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D. E. Shaw’s Strategy Frame

In this 84-page, 103-exhibit case study - "D. E. Shaw & Co., Inc. - Strategy Frame" - Alphacution presents a new, next-level analysis on one of the most legendary quantitative hedge fund managers of them all: D. E. Shaw & Co. Based on a proprietary version of 13F data that has been jointly developed over years with a stealth-mode data partner, this case study leverages a data sample spanning 50 quarters, comprised of 305,789 positions, and based on 15,063 unique...

By Paul Rowady | February 9, 2026 | Premium

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US Equity Market Macrostructure Evolution: The Temple of Financial Fantasy

In this 118-page, 145-exhibit case study - "US Equity Market Macrostructure Evolution: The Temple of Financial Fantasy" - Alphacution presents its case for how the adoption of technology by a subset of leading proprietary trading firms have leveraged the regulatory framework over the past 20 years to permanently alter and distort the US equity market to the point of a farcical rivalry between two separate and distinct “stock markets” that are animated by two competing realities. The first reality is...

By Paul Rowady | July 7, 2025 | Premium

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Headlands Technologies: Return of the Pioneers

In this 33-page, 32-exhibit case study, “Headlands Technologies: Return of the Pioneers," Alphacution details the paradox of one of the newest liquidity providers in US equities while simultaneously being one of its most consequential pioneers. Follow Matt Andresen's journey from Island ECN to the early incarnation of Citadel Securities to the launch of Headlands, where he and team spent a decade - racking up success after success as a liquidity provider in other products, asset classes, and regions - before...

By Paul Rowady | March 6, 2025 | Premium

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US Equity Options – Top 100 Institutional Customer List, Q3 2024

In this 27-page, 20-exhibit case study, "US Equity Options - Top 100 Institutional Customer List, Q3 2024," Alphacution ranks a group of 111 institutional US equity option participants - including banks, brokers, hedge funds, asset managers, and proprietary trading firms - by 5 factors, including total notional long option value, long option positions, average long notional option position value, long option contracts, and average long option contracts per position (aggregated per underlying) - all of which, as of September 30,...

By Paul Rowady | December 23, 2024 | Premium

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US Equity Option Market Makers: Core Strategies and Market Shares, 2019-2023

In this 187-page, 213-exhibit, 45,000-word case study, “US Equity Option Market Makers: Core Strategies and Market Shares, 2019 – 2023,” Alphacution publishes its most comprehensive analysis to date based on the modeling of 17 proprietary trading firms who serve variously as market makers in US equity derivatives across the backdrop of 5 interconnected product classes in futures and options. The objective of this research project was to shed new light on US equity option market mechanics by exploring the products,...

By Paul Rowady | October 11, 2024 | Premium

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Susquehanna Securities – US Listed Equity Derivatives Share, 2014-2023

In this brief 6-page, 6-exhibit case study teaser, Alphacution presents its estimates for the overall market share of US listed equity derivatives volume represented by Susquehanna Securities, the affiliate of legendary options trading powerhouse, Susquehanna International Group (SIG), that's home to the group's US market making operation. This report is presented in the context of Alphacution's forthcoming case study on option market makers' share of US listed equity derivatives which will include Alphacution's market share estimates for Citadel Securities, Optiver...

By Paul Rowady | February 29, 2024 | Premium

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The Transformation of Belvedere

In this 72-page, 75-exhibit, 17,400-word case study, "The Transformation of Belvedere," Alphacution publishes its findings on equity index option specialist, Chicago-based Belvedere Trading. Founded in 2002 with a current team of ~300 employees, Belvedere's story represents a unique addition to the Alphacution research library due to the significant strategy transformation it has undergone over the past few years while maintaining its strengths in SPX options. This case study also showcases certain achievements, trading revenue (sample), risk framework, and trading preferences,...

By Paul Rowady | September 30, 2023 | Premium

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IMC – International Marketmakers Combination

In this 98-page, 115-exhibit, 22,400-word case study, "IMC: International Marketmakers Combination," Alphacution publishes its findings on global option market maker and equity index option specialist, Amsterdam-based IMC BV and its affiliates, including - most notably - its US-based affiliate, IMC-Chicago, LLC (often known as IMC Financial Markets). Founded in 1989 by two floor traders on Amsterdam's European Options Exchange, today IMC is one of only three Tier I proprietary trading firms with legacy in the 1980's - along with legendary...

By Paul Rowady | June 23, 2023 | Premium

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European ETP Spread Analysis For Systematic Internalisers

In this 34-page, 36-exhibit, 6,400-word Focus Note, "European ETP Spread Analysis For Systematic Internalisers," Alphacution publishes its findings from the core research objectives of this project: 1) credibly quantify the theoretical "gross" spread value for ETPs traded on LSEG, 2) credibly quantify the portion of this value for SIs, and 3) illuminate or elevate any other clues about the trading preferences of SIs. To our delight, this research produced an outline for a composite model of SI/wholesaler trading preferences -...

By Paul Rowady | February 6, 2023 | Premium

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XTX [Invades] Markets

In this 87-page, 83-exhibit, 22,700-word case study, "XTX [Invades] Markets," Alphacution publishes its findings - a truly incredible story - about the youngest proprietary trading company to cross the $1 billion revenue threshold in the modern markets era - and the founder, Alex Gerko, who has led that run. Based in London and breaking into the top 10 ranks of overall FX traders before its second birthday, conventional reporting states that XTX Markets Limited was spun out of quant hedge...

By Paul Rowady | October 30, 2022 | Premium

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The Proprietary Traders, Part I – Global Roster and Select Rankings

In this 19-page, 15-exhibit, 2,800-word case study, "The Proprietary Traders, Part I - Global Roster and Select Rankings," Alphacution publishes the first installment of its research series designed to explore the secretive yet influential community of nearly 100 proprietary trading firms spread across the world today, from traditional cash equities market makers to cryptocurrency market makers and liquidity providers. In Part I, Alphacution presents its global roster of proprietary trading firms - including rankings from select perspectives - set against...

By Paul Rowady | June 13, 2022 | Premium

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The Chicago Trading Company with Appendix on European Trading

In this updated 75-page, 77-exhibit chart book, “The Chicago Trading Company with Appendix on European Trading,” Alphacution continues its focus on the explosion of activity in US option markets with a deep dive into another leading option trading firm, CTC, LLC.  In this report, Alphacution leverages evolving modeling capabilities to explore its first example of a proprietary trading firm with core concentration in index options along with the peripheral suite of cash, futures and other option products used to capture...

By Paul Rowady | April 27, 2022 | Premium

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The Chicago Trading Company

In this 71-page, 69-exhibit chart book, “The Chicago Trading Company,” Alphacution continues its focus on the explosion of activity in US option markets with a deep dive into another leading option trading firm, CTC, LLC.  In this report, Alphacution leverages evolving modeling capabilities to explore its first example of a proprietary trading firm with core concentration in index options along with the peripheral suite of cash, futures and other option products used to capture volatility arbitrage opportunities. Furthermore, this research...

By Paul Rowady | March 31, 2022 | Premium

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Simplex Trading, Unadjusted

In this 67-page, 64-exhibit chart book, “Simplex Trading, Unadjusted,” Alphacution borrows the spotlight from the record-setting volumes in the US options market for 2021 and focuses it in on one of the key - yet, relatively little known - players in the space, option market maker, Simplex Trading, LLC. Taking some of its recent modeling upgrades for an initial spin, Alphacution performs its unique brand of visual display on regulatory data to present what is likely to be an unprecedented...

By Paul Rowady | December 31, 2021 | Premium

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The Robinhood Effect

In this 198-page, 273-exhibit, 33,000-word case study, “The Robinhood Effect,” Alphacution brings together data and modeling from 25 entities - 11 retail brokers and 14 wholesale market makers - to explain a new phenomenon that now lives at the center of the US capital markets ecosystem. Alphacution's most ambitious research project to date, this report covers the governing liquidity economics framework that defines PFOF rates, the mechanics of Robinhood's aggressive retail brokerage model, the transformation of the retail brokerage industry,...

By Paul Rowady | July 29, 2021 | Premium

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Payment For Order Flow 2020, Part III: The Retail Flow Factor

In this 17-page, 21-exhibit presentation - Part III of Alphacution's case study on payment for order flow (PFOF) - we present our preliminary development of the "retail flow factor" for 2020 based largely on a reconciliation of 606 data (from 10 retail brokers / 11 entities) and 605 data (from 7 wholesale market makers). The results include estimated monthly penetration of retail order flow relative to the full U.S. cash equities market for 2020 - including estimated breakdowns of odd...

By Paul Rowady | June 3, 2021 | Premium

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Payment For Order Flow 2020, Part II: Broker Personas

In Part I of Alphacution’s case study on payment for order flow (PFOF), we focused mainly on the rates paid by wholesale market makers to retail brokers under a full range of securities categories and order type scenarios. In this 22-page, 20-exhibit deck, Alphacution presents PART II of its upcoming comprehensive case study, The Robinhood Effect, with a focus on a concept called broker personas. Alphacution’s working hypothesis on this topic is that each retail broker – in fact, all...

By Paul Rowady | May 14, 2021 | Premium

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Payment For Order Flow 2020, Part I: Rate Heatmaps

2020 will be remembered for many reasons. In the context of Alphacution’s ongoing research focus, we want to remember 2020 as the first full year of enhanced transparency into the mechanics and impacts of the long-held practice of payment for order flow (PFOF). It turns out, enhanced use of PFOF as the linchpin in a new zero-commission brokerage framework for retail investors (pioneered by Robinhood) sets a series of dominoes in motion that ultimately influence, to some degree, all stakeholders...

By Paul Rowady | April 27, 2021 | Premium

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Rise of Hudson River Trading

In this 91-page, 102-exhibit case study, “The Rise of Hudson River Trading,” Alphacution adds another leading proprietary trading firm - and recent entrant to the $1 billion+ trading revenue club (2020e) - to its library focused on the most secretive and consequential players in the global markets ecosystem. Notable highlights include the history of Sun Trading and the impacts of its acquisition by Hudson River Trading (HRT) in Q1 2018, and explorations into the firm's European trading operations, US equity...

By Paul Rowady | January 23, 2021 | Premium

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History of Jane Street

In this 125-page, 149-exhibit, 26,000-word case study, “History of Jane Street,” Alphacution sets a new bar for the scope of a case study focused one of the leading proprietary trading and market making firms in the world, with notable expansions relative to prior cases studies into regional, US option strategy, revenue estimation, and comparative analysis details (including Citadel Securities, Susquehanna International Group (SIG) and affiliates, and Two Sigma Investments and affiliates). The complete case study is available to premium subscribers...

By Paul Rowady | May 27, 2020 | Premium

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Two Sigma Investments, LP and Affiliates

In this 51-page, 61-exhibit case study on one of the most successful quantitative trading firms launched since the dawn of the 21st century – Two Sigma Investments, LP – Alphacution presents the next in its series of unprecedented reports based on its modeling of many of the most mythological players and impactful themes operating within the current global asset management ecosystem. Of particular note, this report includes a groundbreaking comparative analysis of key strategy parameters between Two Sigma and D....

By Paul Rowady | November 23, 2019 | Premium

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Susquehanna International Group, LLP

In this 55-page, 64-exhibit case study on one of the most legendary proprietary option trading firms of all time – Susquehanna International Group, LLP – Alphacution publishes the next installment in its unprecedented Hiding in Plain Sight series that leverages an assembly of publicly-available data and a growing library of models based on some of the most impactful market participants in the global asset management ecosystem today. The complete case study is available to premium subscribers or via individual report...

By Paul Rowady | July 30, 2019 | Premium

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Deconstructing Citadel Securities

In this 55-page, 45-exhibit case study on market making powerhouse, Citadel Securities, Alphacution continues to expand its unprecedented Hiding in Plain Sight series to explore the unique trading engines and business strategies of the most successful, noteworthy – and mythological – asset managers in the world by presenting its latest storyboard based an assembly of data that lies open to the public. The complete case study is available to premium subscribers or via individual report purchase.

By Paul Rowady | March 23, 2019 | Premium

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Context Machine: Estimating Asset Manager Technology Spending

In this 48-page, 35-exhibit study, Alphacution goes to new lengths to apply the axiom that effective management requires effective measurement – and begins the process of supporting its hypothesis that there are persistent – and ultimately, predictable – relationships between trading and operational factors for asset managers. With most asset managers being private, support for this hypothesis also means that technology spending – a rarely observable data item in this universe – can be estimated with more readily observable and...

By Paul Rowady | April 18, 2018 | Premium

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