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Volant Trading Expands into Ultra-Fast Order Routing for Options Traders

Based on its expertise in options microstructure, VOLEX is unveiling a high-speed liquidity sweep capability for traders known as Take Out.

Market-maker Volant Trading is opening a new execution services division for options traders, offering order routing capabilities through the REDIPlus Execution management system.

The new business, known as VOLEX Execution Services, provides an ultra-low latency infrastructure along with VOLEX Take Out, an order router with high-speed liquidity sweeping capability. VOLEX Take Out is designed to aggressively sweep displayed and hidden liquidity with sub-millisecond order processing times. Both VOLEX and VOLEX Take Out are available through the REDIPlus EMS platform.

“We built the foundation on a low latency option order router, which is sub-millisecond, “ said Vishal K. Gupta, head of VOLEX Execution Services in an interview.

“The Options market microstructure is evolving quickly with 12 exchanges introducing different order type sand complicated fee tables,” explained Gupta in the release. “Only firms that specialize in options trading can offer the continuous improvements needed to optimize order routing for a variety of trading strategies,” said Gupta.

Prior to joining Volante Trading, Gupta was a VP of Goldman Sachs who tripled the execution routing business as leader of the business development team, according to his bio. VOLEX has its own NBBO [National Best bid and offer] for the visible order book. It’s the combination of the feed order routing logic that makes the product unique. “To be fair, nothing works, unless you’re fast,” said Gupta.

“The options order router is ever changing,” noted Gupta in the interview. “Like a race car, it needs to be updated. An options router is only as good as the support behind it,” added Gupta.

“We’re excited about this new relationship with VOLEX Execution Services,” said Goutam Nadella, Chief Product Officer of REDI Global Technologies. “By offering connectivity to VOLEX through REDIPlus® EMS, we’ll provide users with cutting edge technology and a robust suite of options trading tools for all strategies,” stated Nadella.

Traders that use VOLEX Takeout are provided with a set of default parameters for selecting their aggression level. Available over REDIPlus, there is a drop-down menu with the choice of passive, moderate and “Take Out,” which is the most aggressive setting.

“We not only take out the liquidity we see on screen, but we do some aggressive taking logic of any [hidden] liquidity that may be there that is not seen,” said Gupta. The routing logic – really a routing algorithm — incorporates experience based on market, symbol, currently displayed and historical patterns of options trading.

Option traders can also use “aggressive posting techniques” to attract liquidity from the sidelines.

Currently, VOLEX is working with a few large broker dealer clients that piloted the service to start the business. This is the first public announcement of the business.

“Volant is a highly focused options team, that is where our backbone is,” said Gupta. “Leaning on it, we’ve been ready to build-out an incredible service,” he said.

Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio

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