Posts Tagged ‘Trading’

Understanding The Basic Elements of Forex Trading

Thursday, March 10th, 2011

Understanding The Basic Elements of Forex Trading

The foreign exchange market is finally beginning to garner mainstream attention.  The Bank of International Settlements estimates that the average daily volume in the fx market is around $4 trillion, which makes it by far the largest financial marketplace in the world.  Surprisingly, however, many novice investors and traders have never even heard of this market.

Until the late 1990’s, the only players allowed to execute trades in the foreign exchange market were investment banks, hedge funds, and very wealthy private investors.  Since the minimum contract size was generally $1,000,000, smaller traders were effectively denied entrance into the market.

In the late 90’s, however, this all changed.  The advance of the internet and technology led several online forex brokers to open shop and begin catering to smaller investors and traders.  This led to the birth of the retail foreign exchange market.  In this article, we are going to discuss three key elements to forex trading:  Leverage, Margin, and Equity.


The idea of leverage in the fx market has been under intense debate over the last several years.  Since the market is decentralized and worldwide, regulation was largely absent from the fx market until recently.  In 2010, the National Futures Association instituted some major changes, one of them being a cap on leverage at 50:1.  This means that an fx trader in the United States can trade on leverage at a ratio of 50:1.  Thus, if a trader has $1,000 in his account, then he is able to leverage that $1,000 into $50,000 and trade much larger positions in EUR USD.  Until the National Futures Association passed this regulation, some brokers were offering traders up to 400:1 leverage, which means that with a $1,000 account, traders were able to control a $400,000 position in the market. Note that leverage is a two-edged sword. It will increase both losses and profits.


Margin is the life of a trader.  If a trader does not have enough margin, then he cannot open a trade.  Furthermore, if a trader has an open position moving against him, he may eventually not have enough money to act as margin, which means his account would suffer a “margin call.”

Margin is the amount of money required to open a leveraged position.  For example, if Broker ABC offers 50:1 leverage, and Bob the Forex Trader wants to open a position of $100,000, then Bob has to put up $2,000 of margin.  If Bob’s trade begins to move against him to the point where his account equity becomes less than $2,000, Bob will suffer a “margin call,” which basically means that his broker will call for more margin if Bob wants to keep the position open.


Everyone knows that one of the leading causes of business failure is a lack of initial capital, and trading is no different.  If a trader opens an account with a few thousand bucks and trades heavily leveraged positions, his chances of success are nominal.

Equity is essential to trading success.  The question many new traders have is, how much money do I need to open an account?  Well, the answer to that question is different for everyone, and it largely depends on what your goals are.  If you simply want to get some trading experience, but still have a full-time job, then a person can open an account with a few thousand bucks.  However, if you are trying to generate enough capital gains to sustain a living, then the initial account balance should be much, much higher.

Leverage, Margin, and Account Equity are three essential aspects of fx trading that every trader must be familiar with.

Check out our intensive investment banking, private equity, and sales & trading courses!  The discount code Merger34299 will be activated until April 15, 2011. Feel free to e-mail thomas.r[at] with questions.

Google Launches Trading Floor to Manage $26.5 Billion in Cash Reserves

Sunday, May 30th, 2010

According to Google Treasurer Callinicos, the firm has started a trading team and is currently hiring for entry level and experienced trading positions.  Callinicos is very well respected in the finance and technology industries, after serving as Treasurer of Microsoft at a time where the company was generating 7% cash returns.  In 2004, the company was able to pay out a one-time $32 billion dividend.

Specifically, Google is looking for bond traders and portfolio analysts.   The firm currently has the 3rd largest cash reserves of any company, after Microsoft and Cisco.  The trading team will also be used to buy back shares after Google purchased AdMob in a $750 million stock transaction recently.  The transaction was cleared on May 21st.  Surprisingly, Google has been public about not returning cash to shareholders, and instead internally generating value.

The trading floor at Google opened up in January.  Traders at the firm have a primarily role of preserving capital and generating reasonable returns, so that Google has adequate capital to continue to make acquisitions.  The investment team has grown from six people at the outset to 30 people as of today.  Many of the traders at Google are from Goldman Sachs and J.P. Morgan.  Google’s technology allows traders to see 98% of positions in real time, whereas most bank can only monitor 60-70% of transactions in real time.

Google has pulled away from U.S. government notes and has moved $4.9 billion into corporate bonds and agency mortgage-backed securities.  The company has also invested in emerging market sovereign debt.  Unfortunately, Google’s trading salaries are not as lucrative as those on Wall Street, but the company culture is much more laid back and focused on capital preservation.

The firm is currently looking for risk analysts, sovereign debt traders, and MBS traders.  A recent hire, Ranidu Lankaj, had a full ride at Yale, worked for 2 years at Lehman Brothers, and published his first Sri Lankan rap record at age 19. (Source: Bloomberg Businessweek)

New UBS Alumni Investment Bank Princeridge Takes Over ICP Capital

Thursday, March 11th, 2010

After meeting two managing directors from PrinceRidge in Boston, I can definitely vouch for the fact that it is a very respectable firm with great people.  They will continue to grow in this market because of their expertise in high yield issuance, restructuring, and trading.  ICP is a solid acquisition because of its focus in structured products and asset management.

According to Ms. Shenn of Bloomberg, “PrinceRidge Holdings LP, run by former UBS AG executives John Costas and Michael T. Hutchins, is taking over the capital-market operations of ICP Capital, the broker and asset manager focused on structured products.

ICP Capital, majority owned by Chief Executive Officer Thomas Priore, will become one of six senior partners that own PrinceRidge and the combined business will operate under the PrinceRidge name, Costas said today in a telephone interview. Both firms are based in New York.

ICP, which has 60 employees in the units in New York, Chicago, Los Angeles, London and Copenhagen, is teaming with PrinceRidge after losing the head of its trading and investment- banking business, Carlos Mendez. PrinceRidge is attempting to position itself to capitalize on a “once in 50-year opportunity” to create a sizable “boutique” securities firm, as it expects only four or five of about 180 smaller competitors to grow into mid-size rivals to Wall Street’s “mega-players,” Costas said.

“There will be a tremendous consolidation and a shaking out among these 180 players, and the conclusion we clearly came to is we are stronger together, and can increase the probability of us being one of the winners,” he said.

PrinceRidge Chairman Costas, 53, and CEO Hutchins, 54, last year reunited to start their firm after running UBS’s hedge fund Dillon Read Capital Management LLC, which the Swiss bank wound down in 2007 as the credit crisis began roiling debt investors. Costas earlier led UBS’s investment bank.

‘Shouting Match’

PrinceRidge now has 85 employees, Costas said. ICP, which was founded as a Bank of New York affiliate in 2004 and became independent in 2006, has about a dozen workers in its separate asset-management unit, said Priore, 41.

Mendez left ICP after a “shouting match” with Priore last month, industry newsletter Asset-Backed Alert reported March 5. Mendez confirmed his departure in a telephone interview today and declined to comment further.

Priore declined to comment on Mendez’s departure, saying his company could have explored other options including raising capital.

“We chose this route because we think it really speeds up our evolution by a couple of years,” Priore said.”

Candlestick Charting Unveiled – Basic Document

Wednesday, March 10th, 2010

Candlestick Charting Unveiled

The Secrets of Candlestick Charts Unveiled

Currency Trading Guide

Wednesday, March 10th, 2010

Fantastic guide on Fibonacci retracements and currency strategies.
Currency Strategies

Greek Debt Downgraded at Worst Moment!

Wednesday, February 24th, 2010

According to ZeroHedge, Greek debt was recently downgraded by Fitch.  Just today, S&P also announced that they would downgrade the country’s sovereign debt over the next month by 1 or 2 notches, driving up the country’s cost of capital in light of its current fiscal situation.

“And just as Greece was about to launch its 10 year bond offering… Where is Papandreou to claim that Fitch was bought by all the accounts (who may or may not invest in the €5 billion issue) to make the price even better. Because the spread to Bunds just jumped by about 10 bps to 325 following the news. Fitch notes: “The rating actions reflect Fitch’s view that the banks’ already weakening asset quality and profitability will come under further pressure due to anticipated considerable fiscal adjustments in Greece. In particular, Fitch believes the required fiscal tightening that needs to be made by the Greek government will have a significant effect on the real economy, affecting loan demand and putting additional pressure on asset quality. The latter could result in higher credit costs, ultimately weakening underlying profitability.” In the US, where any news is good news, equities jump following the headline.

From Fitch:

Fitch Ratings-Barcelona/London-23 February 2010: Fitch Ratings has today downgraded the Long-term and Short-term Issuer Default Ratings (IDR) of Greece’s four largest banks,  National Bank of Greece (NBG), Alpha Bank  (Alpha), Efg Eurobank Ergasias (Eurobank) and Piraeus Bank (Piraeus) to ‘BBB’ from ‘BBB+’ and ‘F3′ from ‘F2′ respectively. The Outlook on the Long-term IDRs is Negative.

At the same time, the agency has downgraded the banks’ Individual Ratings to ‘C’ from ‘B/C’, whilst the ratings of the banks’ senior, subordinated and hybrid capital instruments have all been downgraded by one notch. The Support Ratings and Support Rating Floors (SRF) of all four banks have been affirmed.

A full rating breakdown is provided at the end of this comment.  Separately, Fitch has also affirmed Agricultural Bank of Greece’s (ATEbank) Long-term IDR at ‘BBB-’, which is on its SRF, and Short-term IDR at ‘F3′. The Outlook on the Long-term IDR is Negative. ATEbank’s IDRs, Support Rating and SRF are based on sovereign support as the bank is majority-owned by the Greek state (rated ‘BBB+’/Negative Outlook).

The rating actions reflect Fitch’s view that the banks’ already weakening asset quality and profitability will come under further pressure due to anticipated considerable fiscal adjustments in Greece. In particular, Fitch believes the required fiscal tightening that needs to be made by the Greek government will have a significant effect on the real economy, affecting loan demand and putting additional pressure on asset quality. The latter could result in higher credit costs, ultimately weakening underlying profitability.

While the banks’ operations in South Eastern Europe (SEE) and Turkey add revenue diversification, such revenues are derived from more volatile economies – some of which have themselves experienced recessionary pressures.

The banks’ profitability is also likely to be affected by higher funding costs derived from increased funding and liquidity pressures on Greek banks which mostly resulted from the ongoing market perception of elevated risk surrounding the Greek sovereign. The uncertainties surrounding the Greek public finances have to a large extent constrained Greek banks’ access to wholesale markets and, to a lesser degree, interbank markets at reasonable prices. As a result, Greek banks continue to rely to some degree on European Central bank (ECB) funding. While unhindered access to ECB facilities provides short-term liquidity, Fitch would welcome a rebalancing of the banks’ funding and liquidity profiles towards more traditional funding sources. However, on a positive note, Fitch highlights that Greek banks continue to be primarily funded by customer deposits (86% of gross loans on average for the five largest Greek banks at end-Q309), highlighting limited reliance on non-bank wholesale funding. Additionally, wholesale funding maturities for 2010 are manageable and funding needs for the year should be limited.

Excluding ATEbank, the other four banks’ Long-term IDRs remain based on their individual financial strength, as expressed by Fitch’s Individual Rating. This takes into account their well-established domestic banking franchises, which support revenue generation and good deposit bases, sound and in most cases recently strengthened capitalisation and also some degree of geographical diversification.

The Negative Outlook on all the banks’ IDRs could be revised to Stable should Greek banks be successful in reducing ECB funding and be able to rebalance their funding and liquidity position without impairing their profitability, and if their underlying earnings capacity proves to be more resilient than currently anticipated to the expected prolonged recessionary environment in Greece and to a lesser extent in SEE.

The ratings of the Greek banks affected by today’s rating action are as follows:

  • National Bank of Greece S.A.Long-term IDR downgraded to ‘BBB’ from ‘BBB+’; Outlook NegativeShort-term IDR downgraded to ‘F3′ from ‘F2′Individual Rating downgraded to ‘C’ from ‘B/C’Support Rating affirmed at ’2′Support Rating Floor affirmed at ‘BBB-’Senior notes downgraded to ‘BBB’ from ‘BBB+’Subordinated notes downgraded to ‘BBB-’ from ‘BBB’Hybrid capital downgraded to ‘BB+’ from ‘BBB-’
  • Efg Eurobank Ergasias S.A.Long-term IDR downgraded to ‘BBB’ from ‘BBB+’; Outlook NegativeShort-term IDR downgraded to ‘F3′ from ‘F2′Individual Rating downgraded to ‘C’ from ‘B/C’Support Rating affirmed at ’3′Support Rating Floor affirmed at ‘BB+’Senior notes downgraded to ‘BBB’ from ‘BBB+’Subordinated notes downgraded to ‘BBB-’ from ‘BBB’Hybrid capital downgraded to ‘BB+’ from ‘BBB-’
  • Alpha Bank S.A.Long-term IDR downgraded to ‘BBB’ from ‘BBB+’; Outlook NegativeShort-term IDR downgraded to ‘F3′ from ‘F2′Individual Rating downgraded to ‘C’ from ‘B/C’Support Rating affirmed at ’3′Support Rating Floor affirmed at ‘BB+’Senior notes downgraded to ‘BBB’ from ‘BBB+’Subordinated notes downgraded to ‘BBB-’ from ‘BBB’Junior Subordinated notes downgraded to ‘BB+’ from ‘BBB-’Hybrid capital downgraded to ‘BB+’ from ‘BBB-’
  • Piraeus Bank S.A.Long-term IDR downgraded to ‘BBB’ from ‘BBB+’; Outlook NegativeShort-term IDR downgraded to ‘F3′ from ‘F2′Individual Rating downgraded to ‘C’ from ‘B/C’Support Rating affirmed at ’3′Support Rating Floor affirmed at ‘BB+’Senior notes downgraded to ‘BBB’ from ‘BBB+’Subordinated notes downgraded to ‘BBB-’ from ‘BBB’
  • Agricultural Bank of Greece (ATEbank)Long-term IDR affirmed at ‘BBB-’; Negative OutlookShort-term IDR affirmed at ‘F3′Individual Rating affirmed at ‘C/D’Support Rating affirmed at ’2′Support Rating Floor affirmed at ‘BBB-’

The rating impact, if any, from the above rating actions on Greek banks’ subsidiaries, securitisation transactions and covered bonds will be detailed in separate comments.”

For more information, see ZeroHedge…

Twenty Books You Should Read About Trading

Tuesday, February 16th, 2010

Twenty books you should read about trading…



Ann Taylor Insider Trading

Tuesday, February 2nd, 2010

Ann options

According to Bloomberg, Ann Taylor options skyrocketed this week in probably the most blatant insider trading event of the year.  It is puzzling to see that Mr. Durden at ZeroHedge picked this up probably weeks in advance of an SEC probe.

“Trading of bullish AnnTaylor Stores Corp. options surged to a 10-week high yesterday before the women’s clothing retailer boosted its fourth-quarter sales forecast today in an unscheduled release.

Either this was a very savvy investor or the information was leaked,” said Frederic Ruffy, the senior options strategist at, a New York-based provider of options market analysis. “The call buying was just a couple of hours before the close yesterday.”

Almost all of yesterday’s trading of 5,766 options giving the right to buy the stock was concentrated in the March $15 calls, which closed at 45 cents yesterday. They more than tripled to $1.65 today as the shares jumped the most in nine months, adding 19 percent to $15.88 at 3:42 p.m. in New York.”

According to Durden,

“With the options purchased at $0.45 and now trading at $1.65, every call attained a profit of $1.20, or roughly $690,000 on the total 5,766 call options purhcased yesterday.”

I don’t know how anyone thought they could get away with this, with pricing live on Bloomberg.  May this be a lesson to all you aspiring traders out there.  There is no point going to jail for an easy trade.


For more information, please see the article by Durden…

Volcker Speech on Regulatory Reform Fails to Inspire

Tuesday, February 2nd, 2010


Today, Mr. Volcker spoke out about his reform against U.S. investment banks and proprietary trading.  After the speech, it looks likely that the rule will not go forward in its original form.

The former Federal Reserve Chairman called out recently to limit bank’s proprietary trading, principal investments, hedge funds, and private equity divisions.

On the opposing end, Senator Richard Shelby (Republican) opposed both the Volcker Rule and President Obama’s decision to levy a $90+ billion tax on U.S. large cap banks.  Although the Leverage Academy team does not feel that these two rules will be approved of in their original form, a tax or some form of penalty for using taxpayer funds for principal investments may still be passed by the House and the Senate.

Since Democrats do not have the necessary 60 votes needed to enforce this reform package, it will only pass with Republican support.

Even the House Financial Services Subcommittee Chairman Paul Kanjorski told the Financial Times that he was only 80% to 85% in agreement with the Volcker rule and that many issues raised by Volcker were already included in his amendment passed by the House.

According to the Financial Times, one of the most outrageous demands today was from Warner, who said he is proposing that US banks set up a USD 1trn fund to invest in US infrastructure projects as a way to avoid the USD 90bn bank levy.  When probed, a staffer said that Warner is not calling for the banks to place USD 1trn in cash, but to raise such an amount through leverage…

Below is a live blog of the speech by the Wall Street Journal…

Text begins here:

So Mr. Volcker, what is prop trading anyway? It is the $64,000 (make that the multi-billion dollar question) for Wall Street.

So far, the former Federal Reserve Chief, who is now spear heading the Obama administration’s effort to overhaul the banking system, has been pretty vague on exactly what constitutes proprietary trading — or trading on behalf of a bank, rather than its customers. A copy of Volcker’s prepared testimony is more specific about what Volcker thinks banks should do, rather than what he thinks they should not do.

Other key issues that Volcker is likely to address in his testimony before the Senate Banking Committee are proposing capital and leverage restrictions on large banks.

Deal Journal is live blogging the hearing.

    • 2:36 pm
    • by Michael Corkery

    Chairman Chris Dodd is opening up the hearing, just as President Obama has finished his remarks at a town hall meeting in Nashua, NH. This is like the well-oiled Obama presidential campaign when everything was highly orchestrated.

    • 2:40 pm
    • by Michael Corkery

    Sen. Shelby: He’s “disturbed” by the way Obama has sneaked in the Volcker rule seven months after it first proposed financial reform that it called “sweeping.”  Is Shelby suggesting that politics may have played a role in the timing of Obama’s latest proposal? No. Really?

    • 2:41 pm
    • by Michael Corkery

    That said, Shelby says he supports the Volcker Rule…

    • 2:43 pm
    • by Michael Corkery

    Volcker is Up: Right off the bat he goes to Prop Trading…He says it’s not an issue of whether prop trading is bigger risk than others. It is a risk. Period. And taxpayers shouldn’t backstop that risk.

    • 2:49 pm
    • by Michael Corkery

    Volcker: This is about two big to fail.  We have to limit banks and non-banking institutions from engaging in activities that could require a bail out…He references AIG and GE Capital…

    • 2:52 pm
    • by Michael Corkery

    Volcker: Bank supervisors with “strong legislative direction” sould be able to contain excess in trading. Wait a second. Is Volcker proposing to leave it to the banks to decide what is risk and not risky? Um, that didn’t really work too well.

    • 2:55 pm
    • by Michael Corkery

    Volcker hasn’t looked up once from his prepared testimony.

    • 3:00 pm
    • by Michael Corkery

    This is dry stuff. Bring Back Geithner or Blankfein.

    • 3:02 pm
    • by Michael Corkery

    Volcker: Trading “incidental” to customer interests would be OK. Trading that is not explicitedly done on behalf of the customer is not OK.

    • 3:07 pm
    • by Michael Corkery

    Dodd asks but isn’t “hedging” good for bank? Couldn’t that be seen as propreitary behavior?

    Volcker brings up a good example: AIG had credit defaualt swaps which were designed to be hedges, but when AIG doubled down on CDS they were no longer hedges, but an added risk.

    • 3:07 pm
    • by Stephen Grocer

    Dodd asks: If the U.S. adopts the Volcker rule and other don’t, has U.S. left its institution in a weaker competitive position?

    • 3:09 pm
    • by Stephen Grocer

    Volcker counters that the plan has receive support elsewhere, especially London.

    • 3:10 pm
    • by Michael Corkery

    Shelby: There is no evidence that prop trading fueled the losses that contributed to the credit crisis. Plus, Bear and Lehman were not commerical banks yet were more interconnected and posed systemic risk. So why so much focus on prop trading

    • 3:11 pm
    • by Michael Corkery

    Volcker is not really answering the question.

    • 3:15 pm
    • by Michael Corkery

    Volcker just compared ‘too big to fail’ institutions to pornography…”you know it when you see it.”  That’s a new one.

    • 3:18 pm
    • by Michael Corkery

    Grocer, Volcker says he’s not naive and he’s been around for a long time, but does he really think that he can get other countries, like the UK and France, to agree to enact similar restrictions?

    It’s hard enough to get the U.S. Congress to agree to these rules.

    • 3:24 pm
    • by Michael Corkery

    Volcker: It’s not theoretical the conflicts of interests inherent of prop trading. It’s inenvitable that you will trade against the interest of your customers. But he has no specifics.

    • 3:28 pm
    • by Stephen Grocer

    Corkery: If the Conservatives are elected in the U.K., London might get a version of the rule.  But EU has indicated that it is unlikely to follow the U.S. lead if it passes the Volcker rule. That would definitely put U.S. institutions at a disadvantage.

    • 3:28 pm
    • by Michael Corkery

    Volcker just joked that he’s always thought that a “Chinese Wall” is actually permeable. “It didn’t keep out the Huns, did it?”  Banks have said that there is a chinese wall between depository and prop activiity. Economist humor.

    • 3:32 pm
    • by MIchael Corkery

    These Senators are going easy on Volcker. I guess it wouldn’t look good to gang up on the elder, grandatherly academic. But the former Fed chair is admitting to a lot of unknowns in his proposal.

    • 3:37 pm
    • by Michael Corkery

    Volcker is finally showing  a little animation.  Sen. Corker is telling him that commerical banks cannot move money from the commerical side of the bank to another part of the bank. “You don’t think they can do that,” Volcker says.

    • 3:40 pm
    • by Michael Corkery

    Dow has stayed up 115 points.  Looks like the market thinks the Volcker Rule is a dead on arrival in the Senate.

    • 3:43 pm
    • by Michael Corkery

    Volcker: If Goldman wants to keep prop trading they have to give up banking license and access to cheap capital at the Fed window.

    • 3:47 pm
    • by Stephen Grocer

    Volcker declines to rank which of the activities — private equity, hedge funds or proprietary trading — is riskiest.

    • 3:52 pm
    • by Michael Corkery

    Sen. Mike Johanns: “I get more confused as you testify. You are not clearing it up.”
    Finally someone said it.

    • 3:54 pm
    • by MIchael Corkery

    Volcker: “I am puzzled why I am losing you.”

    • 3:56 pm
    • by Michael Corkery

    Volcker says his rule wouldn’t have stopped AIG or Lehman. But the “comprehensive” reforms by the Obama administration would have stopped those problems.

    • 3:57 pm
    • by Stephen Grocer

    Sen. Johanns is raising the question of the day: How will the Volcker rule have prevented the financial crisis. It would not have solved the problem with AIG or

    Volcker responds: That rule was not designed to solve the problems of those firms.

    • 3:58 pm
    • by Michael Corkery

    Best quote of the hearing.

    Volcker: The issue is look ahead. I am telling you if banks are protected by tax payer and given free rein to speculate. There are going to be problems. “I may not live long enough to see the next crisis. But my soul is going to come back to haunt you.”

    • 3:59 pm
    • by Stephen Grocer

    Volcker points out his rule is designed to solve future problems, not just the regulatory gaps laid bare by the current financial crisis.

    • 4:12 pm
    • by MIchael Corkery

    Sen. Jim Bunning: Wait, I thought your goal was about preventing banks from getting too big to fail. But this proposal does nothing to require banks to shrink.

    • 4:18 pm
    • by Michael Corkery

    From the sounds of the senators skeptical questioning, Volcker’s rule looks to be on thin ice. The hearing was not a total wash out: Volcker warned that his ghost will come back to haunt the Senate if they don’t listen to him.  That will be a quote that will no doubt be pulled out years from now for that inevitable “I told you so” moment.


  • For more information, please visit WSJ…

Citadel Investment Group to Let Down its Gates

Sunday, November 8th, 2009

Citadel Logo

CEO Kenneth C. Griffin recently sent a letter to investors allowing them to redeem funds starting November 30, 2009.   Citadel did not allow investors to withdraw capital since 2008 due to the turmoil and illiquidity of the credit markets.  Other firms that raised gates last year included D.E. Shaw, Farallon Capital Management, and Magnetar Capital.  Two of Citadel’s bond funds, Wellington and Kensington, are up 57% this year after plunging more than 55% in 2008.  Griffin plans to improve the firm’s liquidity and free up assets on its balance sheet over the next year.

Citadel Investment Group is a fund based in Chicago that allocates capital across various asset classes.  It is the eleventh largest hedge fund manager globally and has $14 billion in AUM.  The firm employs equity option strategies, distressed debt strategies, provides investment banking services, and operates a fund of funds business.  Other asset classes Citadel trades include global equities, convertibles, energy products, currencies, rates, and mortgages.  Citadel’s equity trading activities contribute to nearly 3% of daily trading activity in NY, Chicago, and Hong Kong.  Citadel Securities routes more than 30% of the average U.S. listed equity options trading volume as well.