Tradercraft

An Optiver Insights event

The exciting world of electronic trading is a problem solver’s paradise. However, to truly put your skills to the test, you’ll need to know some secrets of the trade. It’s time to learn some…Tradercraft.

Hosted by Optiver trainer, Robbert Pullen, this interactive training course delves into the theory and techniques of modern-day trading and market making. You’ll get access to Optiver’s proprietary virtual trading platform, Optibook, and gain a deeper understanding of how to develop and analyse trading algorithms. You’ll also be shown how best to optimise them for different financial instruments using your knowledge of Python and have the support of experienced industry professionals.

There’ll also be prizes up for grabs for the top performers including: Nintendo Switch gaming system (1st), JBL Charge 4 bluetooth speaker (2nd), Gaomon S620 graphics tablet (3rd)

To take part in Tradercraft – fill in your details and provide a short introduction about who you are and why you’re applying. Applications will close on 22 January 2021 and space is limited.

We look forward to welcoming you!

sign-up now

LECTURES

ABOUT THE FINANCIAL INDUSTRY AND OPTION THEORY

LECTURE 1: INTRODUCTION TO TRADING AND MARKET MAKING

Topics that will be discussed:

  • Financial markets, instruments, and the connections between them
  • Roles of different market participants
  • Order books: the place where buyers and sellers meet
  • Market makers and liquidity
  • Managing risk as a market maker
  • Communicating with buyers and sellers on exchanges
  • Sending buy and sell orders
  • Calculating portfolio values
  • Pairs trading strategies
  • Practical assignment on Optibook – write a trading strategy in python 

Lecture 2: Option Theory

Topics that will be discussed:

  • Introduction to options and their terminology
  • Building blocks of options: intrinsic and time values
  • Importance and challenges of time values
  • Factors influencing option prices
  • Calculating future values
  • Calculating option values using the Black-Scholes formula
  • Understanding Put-Call Parity
  • Hedging options
  • Deltas and why they’re important to market makers
  • Practical assignment on Optibook – write an algorithm to make markets in options 

Lecture 3: Advanced Option Theory

Topics that will be discussed:

  • Trading volatility and what it means for options
  • Differences between historical and implied volatility
  • Adjusting the Black-Scholes model
  • Trading in the unknown
  • Meaning behind volatility skew
  • What the Greeks are and how to use them
  • Making a hedged option work for you
  • Volatility trading and its challenges
  • Market making in options: science or art?
  • Practical assignment on Optibook – write an algorithm that will compete against the rest of the class

Lecture 4: Algorithm challenge

  • Selected attendees will be invited to participate in an algorithm challenge
  • The teams will compete against each other to determine which algorithm is the best performing
  • The top three performers will win the following prizes:

1st prize – Nintendo Switch gaming system

2nd prize – JBL Charge 4 bluetooth speaker

3rd prize – Gaomon S620 graphics tablet

Trainers

OptiBook

Virtual exchange

OPTIBOOK

This is our proprietary virtual exchange used for training. It gives you a real-world trading experience with the safety net of a simulated environment. It’s the perfect way to learn and improve your trading skills.

For your Tradercraft assignments you’ll be using your knowledge of Python to develop algorithms to solve various problems. Each assignment will build off of the previous one and incorporate what you’ve learnt from your lectures. The complexity of each one will become progressively more challenging.

We’ve also set up a virtual machine environment on the Amazon cloud called “Cloud9”. It’s pre-configured to work with Optibook and gives you everything you need to get started. Extra course materials will also be shared on here as the course progresses. Log in credentials will be provided to each team.