Amit Bhuchar

The investment will provide infrastructure, expanding TransFICC’s electronic trading capabilities in a bid to enhance venue and workflow support.  

Other investors in the funding round include BlackFin Tech, AlbionVC, Citi, HSBC, Illuminate Financial, ING, and Commerzbank Group’s early-stage investor and innovation unit, neosfer. 

To date, the combined investments raised totals $50 million. 

Amit Bhuchar, head of FICC liquidity solutions, Citadel Securities, said: “Citadel Securities has a long history of developing innovative solutions to help our clients and partners address their most complex liquidity and execution challenges.  

“We are pleased to partner with TransFICC to shape the future of fixed income market making through increased automation, connectivity and efficiency.” 

According to TransFICC, the technology aims to address challenges presented by the increased adoption of algo tools, all-to-all markets and the rise of fixed income ETFs that are driving demand for automated solutions. 

TransFICC, which specialises in low-latency connectivity and workflow services for fixed income and derivative markets, launched its TransACT (Automated Customer Trading) service in 2024, which automates request for quote (RFQ) negotiation workflows for banks trading on dealer-to-client (D2C) venues.
 
Read more – TransFICC to bid for fixed income consolidated tapes

In November 2024, the firm announced its intentions to bid to be a consolidated tape provider (CTP) for fixed income, ahead of expected confirmation and authorisation of the new CTPs in Q4 of this year. 

In the same month, Broadridge Financial Solutions’ LTX partnered with TransFICC at the end of last year to enable more efficient venue onboarding via its One API for eTrading platform 

TransFICC co-founder Tom McKee said: “Fixed income trading firms need to support and expand venues and workflows while maximising efficiency. However, the time and development costs of connectivity can be significant.  

“At TransFICC, our intention is to enhance our venue and workflow support so that clients can connect more quickly and at a lower cost.” 

The post Citadel Securities leads $25 million Series B investment in TransFICC appeared first on The TRADE.

Over the last year, the liquidity landscape has continued to develop, with players continually innovating their offerings and growing their teams to better meet client needs.

Among the key players in this competitive landscape, The TRADE has selected Citadel Securities, Optiver, Virtu Financial, and XTX Markets for the 2023 shortlist, following various individual achievements by these businesses over the past year. 

Citadel Securities 

Needing little introduction, Citadel Securities, is one of the largest market makers in US Treasuries and USD interest rate swaps globally, and serves an extensive list of financial institutions, including: banks, asset managers, pension funds, hedge funds, central banks, and sovereign wealth fund. Its focus is to provide investors with the liquidity needed to trade equity and fixed-income products in any market condition.

Over the summer, Citadel Securities entered into the credit sphere amidst technological advancements, offering US investment-grade bond trading to clients as of June. Speaking at the time, head of fixed income ETF trading, Bob Cariste, highlighted that the initial focus for the business was on investment-grade (credit) due to the fact that that is where the greatest overlap exists with Citadel’s existing fixed income business.

The firm is active across more than 55 markets, with $440 billion in trades executed per day. Last August, the business opened its Tokyo office, continuing its global expansion in the region – offering US fixed income products to Japanese institutional investors. The firm’s growing global footprint now includes 15 offices across North America, Europe, and Asia Pacific.

Optiver

Optiver has gone from strength to strength in recent years, developing a unique European cash-equity franchise thanks to its expertise in options and ETF market making. Over the last 12 months, the business has grown its client roster, establishing cash-equity trading relationships with various entities including: asset managers, sovereign wealth funds and private banks. Optiver’s approach is to give institutional asset managers access to liquidity from its central risk book.

Optiver’s net trading income in 2022 saw a 42% year-on-year increase, with a total equity of €3.6 billion compared to € 2.8 billion the previous year. Optiver’s market structure team actively monitors developments among exchanges, custodians, industry groups, and policy makers in order to formulate the business’ stances. The firm also regularly publishes whitepapers and shares insights on market structure and regulation, recently sharing insights around: T+1, IFR/D, key options considerations, EU and US policy, and venue functions.

In March, Optiver was the lead investor in the equity funding round for the launch of the MEMX Options exchange. As part of its commitment, the business confirmed it would assume a MEMX board seat, as well as chairmanship of a newly-created Options Market Structure Committee. In September, the electronic market maker selected Philippe Rizzo to join its institutional sales team, with his role focused on cash equity sales in France, Belgium, Luxembourg and Switzerland. Rizzo joined from Instinet, where he previously served as a global equity sales trader. The same month, Optiver took a further step in its US expansion plans with the opening of a new Chicago office, an increase of over one-third from the firm’s previous footprint in the city. 

Virtu Financial

Global market maker Virtu Financial has had a stellar performance over the last 12 months with a high number of business updates across various areas as it enhanced its offering aimed at creating more efficient global markets. Virtu’s product suite includes offerings in execution, liquidity sourcing, analytics and broker- neutral, multi-dealer platforms in workflow technology. It operates across Asia Pacific, Canada, EMEA, and the US.

In August, Virtu entered into a strategic alliance with InvestorLink to integrate order management and AI-based matching platform with Virtu’s infrastructure to offer retail investors better access to the primary markets. In June, Virtu upgraded its POSIT Alert block trading capabilities to include automated dark liquidity seeking in a bid to tackle fragmentation in the non-displayed markets. Named Alert+, the solution aims to give traders an increased opportunity to execute any residual and reduce execution risk by sourcing incremental dark liquidity and completing orders more quickly. The upgraded workflow solution allows users to immediately elect to route residual share quantities not filled on POSIT Alert to be executed in the dark via Virtu’s Covert algorithm.

Back in April, the business’ Triton execution management system (EMS), Triton Valor, was integrated with the bookbuilding platform offered by equity markets technology solution, Appital. Named Appital Turquoise BookBuilder, the solution is an algorithmic bookbuilding platform which brings a typically manual and opaque process into an automated, electronic offering. More recently, in September, Triton Valor was integrated by Sumitomo Mitsui Trust AM. Triton Valor supports trading across: Munis, MBSs, global corporate and sovereign bonds, fixed income ETFs, EM debt, futures and CMOs, aiming to allow users to utilise a single dashboard across asset classes. Last March, Virtu added Liquidnet alumnus Leon Mouzourakis to its execution services team in an electronic trading role. 

XTX Markets 

London-based algorithmic market maker XTX Markets continues to impress as its operations develop. The business partners with counterparties, exchanges and e-trading venues globally and provides liquidity in the equity, foreign exchange, fixed income and commodity markets. XTX Markets’ clients range from regional banks to institutional investors – including macro, systematic funds and real money. The business hit record profits of £1.095 billion from its UK entities in 2022, up 64% from the previous year.

Following solid results, the business continues to be at the forefront of making financial markets more efficient for all participants. Its focus is on reducing the cost of trading for clients through its analytical tools and data-driven insights. The quantitative trading firm opened its new office in New York earlier this year, and also has bases in London, Mumbai, Paris, Singapore, and Yerevan.

The team is made up of more than 200 people across the globe, speaking 26 languages. Last October, XTX Markets appointed Zar Amrolia as chair, replacing Niki Beattie who held the position for five years. Amrolia’s appointment came as part of XTX Markets’ leadership transition. The business is focused on growing its equities franchise in the US going forward. In March, XTX Markets appointed Credit Suisse alumnus Charlie Whitlock as head of Americas distribution, leveraging his 25 years of experience in financial markets. Based in XTX’s New York office, Whitlock is responsible for growing XTX’s single dealer platform business in the US.

The post Leaders in Trading 2023: Meet the nominees for… Outstanding Non-Bank Electronic Liquidity Provider appeared first on The TRADE.

She will replace Phillip Gillespie, who will step down from the role to focus on a ventures role with SBI, the Japanese financial group which acquired B2C2 in 2020.

White has been promoted to the position after serving as chief executive officer, USA for B2C2 over the last year. During her tenure, she led the effort to expand B2C2’s capabilities in electronic trading across spot and derivatives.

Before joining B2C2, White spent five years at Citadel Securities, most recently serving as global chief operating officer of fixed income. Prior to that, she was global head of electronic markets within the fixed income division at Morgan Stanley.

“I knew we made a strong hire when Nicola joined the New Jersey office in 2021. Earlier this year I supported her promotion within B2C2’s leadership,” said Max Boonen, co-founder and director of B2C2.

“The next twelve months in the crypto market will not be for the faint of heart and I am glad to have Nicola with us as we embark on an aggressive effort of market share expansion.” 

Alongside White’s appointment, B2C2 also recently named Thomas Restout as chief executive officer of EMEA.

Restout joined B2C2 from Morgan Stanley, where he most recently served as global head of macro electronic trading. According to B2C2, he has brought additional and complementary market knowledge, as well as risk management and product innovation expertise to the firm.

“I am honored and excited to be appointed to the role of Group CEO at this time of significant growth for the firm,” said White.

“Despite the current stresses the market is experiencing, in the future the crypto market will emerge stronger, and I’m looking forward to working with Thomas and my outstanding team as we drive the industry forward.”

The post B2C2 names former Citadel Securities fixed income operations chief as Group CEO appeared first on The TRADE.

Tokyo becomes the latest addition in the firm’s global expansion, which now includes 15 offices across North America, Europe and Asia Pacific.

Following its recent registration as a Type 1 Financial Instruments Business Operator, Citadel Securities is now able to offer liquidity in US fixed-income products – including US treasuries and USD interest rate swaps – to the Japanese market.

“Japanese institutional investors have long played a critical role in the global fixed-income markets.”

Once membership in the Japan Securities Dealers Association has been granted, Citadel Securities’ operations are expected to begin under the supervision of Japan’s Financial Services Agency.

The firm’s Japanese operations will be led by a local team including Shinichiro Kato, representative director of the Japan entity and Chungwon Gee, who will be responsible for Asia-hours fixed-income trading.

Alongside accessing Japan’s global platform and resources, Citadel Securities said it also plans to tap the country’s population of technical and trading talents as it continues to grow in the region.

“Japanese institutional investors have long played a critical role in the global fixed-income markets, and we look forward to providing them with our differentiated product offerings driven by innovations, technology, consistent and competitive pricing, best-in-class markets insights, and global macro thought leadership,” said Paul Hamill, global head of fixed income distribution at Citadel Securities.

Earlier this year, Citadel Securities secured a $1.15 billion investment from Sequoia and Paradigm. Following the investment, the market maker revealed plans to expand its technology to more markets and asset classes, including crypto.

The post Citadel Securities continues global expansion with new Tokyo office appeared first on The TRADE.

Nazarali has spent the last 11 years at Citadel Securities, initially joining as senior advisor to the company’s chief executive in 2011.

He later took on the role of global head of business development, operating in the role for the last four years.

Prior to that, he spent 11 years at Knight Equity Markets, most recently serving as senior managing director and head of the electronic trading group.

In addition, Nazarali has operated as a consultant at both Ernst and Young and Bain & Company.

In a social media post announcing his appointment, Nazarali described EDX Markets as “a new exchange we are launching with a consortium of industry leaders to enable safer, faster and more efficient trading of digital assets through trusted intermediaries.”

Nazarali also stated that EDX Markets has been designed to meet the needs of the world’s largest and most sophisticated financial institutions.

The exchange has received support from Charles Schwab, Citadel Securities, Fidelity Digital Assets, Virtu Financial, Sequoia Capital and Paradigm, with additional market participants expected to join as partners over time.

The post EDX Markets appoints Citadel Securities alumnus as CEO appeared first on The TRADE.

IEX was founded by former RBC electronic traders Brad Katsuyama and Ronan Ryan, notorious for their portrayal in 2014 Michael Lewis’ book ‘Flash Boys’. In 2020 the group applied for approval for the D-limit order, which it claimed would combat adverse selection, levelling the playing field between HFTs and slower market participants.  

A D-limit allows traders and investors to submit a discretionary limit order that can adjust its pricing if the stock price is about to change for the worse, using predictive technology called IEX Signal.  

“We deny the petition challenging the SEC’s decision,” stated three federal court judges.

“D-Limit… is an innovative, yet simple, solution designed to enhance on-exchange liquidity,” IEX group president Ronan Ryan said at the launch. “D-Limit has gained the support of a broad coalition of asset managers, pension funds, brokers and market makers, and represents a continuation of our efforts to partner with the broker-dealer community to provide new solutions for best execution designed to help all market participants achieve better performance in displayed trading.” 

The order gained market support from players including Virtu Financial and Goldman Sachs. However, others were strenuously opposed: including Citadel Securities, which wrote to the SEC on 14 August, 2020 expressing its concern that the IEX proposal would discriminate against liquidity takers. 

“This proposal represents a significant departure from the current market structure, unfairly favouring IEX liquidity providers without any corresponding obligation, compelling market participants to preference IEX over other exchanges, and adversely impacting tens of millions of orders submitted by retail investors annually,” said Stephen Berger, global head of government and regulatory policy at Citadel Securities, in the letter.  

The regulator nevertheless decided in favour of IEX and the order type was approved on 26 August, 2020, noting that there was no evidence that the D-limit would require “material changes” to brokers’ routing strategies. Widely seen as a victory for IEX, the D-limit was launched in October 2020. Citadel Securities subsequently petitioned for review, arguing that the SEC lacked substantial evidence for one of its findings and that three of the SEC’s decisions were (as referred to in the court statement) “arbitrary and capricious”. 

“No one in this case has alleged that latency arbitrage is unlawful. The issue, instead, is whether the SEC may allow IEX to innovate.”

The case was heard in October 2021 and on 29 July, 2022 the US Court of Appeals ruled conclusively in IEX’s favour. “We deny the petition challenging the SEC’s decision,” stated three federal court judges. “The SEC’s determination that the D-Limit order does not violate the Exchange Act by unfairly discriminating or unduly burdening competition was reasonable and supported by substantial evidence.” 

IEX, which promotes itself as a champion of fair investing, has vocally opposed latency arbitrage since it received regulatory approval to become a licensed trading venue back in 2016 – another controversial SEC decision that split the market, with detractors including Citadel Securities, the New York Stock Exchange and Nasdaq expressing vehement opposition, while players such as T Rowe Price and Franklin Templeton voiced public support.  

Last week’s decision saw the court expressing neutrality on the subject. “At issue is not whether companies like Citadel may seek advantages in the market by using advanced technology and ingenious trading strategies,” said the judges. “No one in this case has alleged that latency arbitrage is unlawful. The issue, instead, is whether the SEC may allow IEX to innovate, with the D-Limit order, in a way that offers new opportunities to long-term investors.”  

IEX called the ruling “a huge win for all investors and traders.” 

In a statement reported by Bloomberg, Citadel Securities spokesperson David Millar said: “We look forward to continuing to engage with the SEC to ensure that the best interests of both retail and institutional investors are protected.” 

Read more about IEX Exchange in our interview with Brad Katsuyama and Ronan Ryan following its licensing in 2016.  

Learn more about the consequences of the ‘Flash Boys’ case and the ripple effect from Lewis’ book in our latest feature for the Q2 magazine.  

The post Citadel Securities loses ‘Flash Boys’ appeal appeared first on The TRADE.