Overnight Retail Traders Start Changing Market Timing
Late-night retail traders are starting to change the dynamics of the derivatives markets, according to panel participants during the a industry gathering sponsored by the CME Group in New York City on Thursday evening.
ìThereís going to be seismic shift in the markets,î said Steven Quirk, senior vice president, Trader Group at TD Ameritrade. ìItís no longer going to be X percent volume at the open and at the close.î
TD Ameritrade has seen a spike in growth in orders placed between 2 am and 6 am.
ìThese arenít order from Europe or Asia-Pac, they're from truck drivers staying up late and trading from mobile devices,î Quirk added.
ìWe used to have four people covering clients account with one person covering late night and another covering early morning,î said Joe Guinan, founder, chairman and CEO of Advantage Futures. ìNow weíve hired a full-time person to provide overnight coverage.î
This trend is not likely to disappear anytime soon as concerns over Greeceís potential departure from the euro drives more retail investors from the cash equities markets into derivatives.
ìApproximately 35 percent of our transactions are now in the derivatives space,î said Quirk. ìItís been growing 19 percent annually over the past decade. Weíve seen 45,000 clients make their first derivatives trades - options puts, calls and covered calls.î
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ìThereís going to be seismic shift in the markets,î said Steven Quirk, senior vice president, Trader Group at TD Ameritrade. ìItís no longer going to be X percent volume at the open and at the close.î
TD Ameritrade has seen a spike in growth in orders placed between 2 am and 6 am.
ìThese arenít order from Europe or Asia-Pac, they're from truck drivers staying up late and trading from mobile devices,î Quirk added.
He attributed much of the change to the untethering of trading from the desktop. ìWe have trading interfaces for almost any device. Some days 60 percent of the trades are opened on mobile devices.î
This trend has not gone unnoticed by the futures commission merchants (FCMs) as they have to adapt their business to meet the new order flow.
ìWe used to have four people covering clients account with one person covering late night and another covering early morning,î said Joe Guinan, founder, chairman and CEO of Advantage Futures. ìNow weíve hired a full-time person to provide overnight coverage.î
This trend is not likely to disappear anytime soon as concerns over Greeceís potential departure from the euro drives more retail investors from the cash equities markets into derivatives.
ìApproximately 35 percent of our transactions are now in the derivatives space,î said Quirk. ìItís been growing 19 percent annually over the past decade. Weíve seen 45,000 clients make their first derivatives trades - options puts, calls and covered calls.î
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