Over 35 years ago, Optiver started business in Amsterdam with a single trader on the floor of the world’s first Stock Exchange. Much has changed since the days of the open outcry system, in which hand signals and shouting were used to execute manual trades. Since then, our firm has become a leading global trading firm and market maker, focused on pricing, execution and risk management. Today, financial econometrics is an integral component of modern quantitative trading. As experts in this field, we inject liquidity into financial markets using our own capital, at our own risk, by trading a wide range of products including listed derivatives, cash equities, ETFs, bonds and foreign currencies. With our focus on cutting-edge engineering, trading and research, we actively trade on 50+ exchanges around the world, where we're trusted to provide accurate buy and sell pricing for hundreds of thousands of interconnected financial instruments. To be not only active - but also precise - across such a volume of markets and products is a hugely complex challenge. To remain at the forefront of this market making responsibility, Optiver holds mathematics at the core of everything we do.
Mathematics in Research
Quantitative modelling acts as the foundation upon which Optiver’s trading activities are built. Our research teams – experts with PhDs in Econometrics, Mathematics, Physics and Statistics – utilise a scientific approach to research and design our world-class trading algorithms. This means applying and developing state-of-the-art stochastic models to price options and predict market volatility, as well as utilising Monte Carlo methods; and determining how to perform differentiation on discrete realisations of stochastic processes. It also means developing statistical arbitrage strategies by working with petabytes of low latency, high-frequency market data sets, an extensive high-powered computing back-testing framework and much more. Optiver Researchers believe in academic discourse, and therefore invite their teammates and Traders to challenge each hypothesis. Can it be mathematically improved? Does it pose potential risk? Does it exploit a market behavioural pattern? Can it sustain its output goals? Constant testing, analysis, refinement and innovation ensure our quantitative models remain at the cutting-edge of constantly evolving capital markets.
Mathematics in Trading
Trading is a number’s game, so Optiver Traders require razor-sharp mathematical intuition to be able to make confident, quick decisions no matter the market conditions. When they aren’t actively trading, their focus shifts to checking positions and monitoring live market activity. This requires outstanding econometrics skills, in order to calculate at a moment’s notice: risk exposures, price changes to underlying assets, the rate prices are changing, and the sensitivity of an asset’s price to various factors. Traders must understand the theoretical volatility and correlation developed by Researchers, and how changes therein affect their portfolios. These advanced mathematical skills allow Optiver Traders to offer the most fair and accurate prices, benefiting all market participants.
Mathematics in Technology
At Optiver, we leverage technology to solve a variety of complex problems: optimising for scarce bandwidth, responding to market events with sub-nanosecond speed, automatically pricing complex sets of financial instruments with extremely low error tolerance, and analysing huge volumes of data. Our systems are built to add to the stability of the market, not detract from it; therefore they must operate at peak efficiency in the most extreme market conditions. Optiver Technologists require a highly mathematical, logic-based approach to bring these solutions to life.