Convergex Launches a New Buy-Write Algorithm
- The solution provided by the agency focused broker allows traders to implement their buy-write trading strategies electronically
One of the big agency-focused global brokers, Convergex, has unveiled a new product developed by the company for its clients. The firm, which actively delivers trading-related services, launched its new Buy-Write Algorithm.
The new solution uses two proprietary algorithms already developed by the company - the advanced VWAP equity algorithm and the Pulse options algorithm. The product allows clients to employ electronically buy-write trading strategies.
The buy-write trading strategy consists of writing call options on a certain position which the trader has on the market
A buy-write trading strategy involves the writing of call options on a certain position which the trader has already taken on the market. The idea behind the strategy is to gain from option premiums.
The downside in this strategy is limited by the fact that the options position is technically covered by the position which the trader already has on the market.
Combining the expertise in building alrorithms for trading Equities Equities Equities can be characterized as stocks or shares in a company that investors can buy or sell. When you buy a stock, you are in essence buying an equity, becoming a partial owner of shares in a specific company or fund.However, equities do not pay a fixed interest rate, and as such are not considered guaranteed income. As such, equity markets are often associated with risk.When a company issues bonds, it’s taking loans from buyers. When a company offers shares, on the other hand, it’s selling pa Equities can be characterized as stocks or shares in a company that investors can buy or sell. When you buy a stock, you are in essence buying an equity, becoming a partial owner of shares in a specific company or fund.However, equities do not pay a fixed interest rate, and as such are not considered guaranteed income. As such, equity markets are often associated with risk.When a company issues bonds, it’s taking loans from buyers. When a company offers shares, on the other hand, it’s selling pa Read this Term with the options business of Convergex, the algorithm aims to buy equity positions and sell call options on the same stock simultaneously. Convergex's clients can therefore hedge their equities exposures and also pocket some additional income from options premiums with a limited downside.
Commenting on the announcement, the managing director and head of electronic Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term of Convergex, Oliver Sung, said, “Our diverse client base is always looking for new ways to extract more yield from the marketplace.”
“This buy-write algorithm provides a powerful new way for our clients to employ options in their investment strategy,” he added.
One of the big agency-focused global brokers, Convergex, has unveiled a new product developed by the company for its clients. The firm, which actively delivers trading-related services, launched its new Buy-Write Algorithm.
The new solution uses two proprietary algorithms already developed by the company - the advanced VWAP equity algorithm and the Pulse options algorithm. The product allows clients to employ electronically buy-write trading strategies.
The buy-write trading strategy consists of writing call options on a certain position which the trader has on the market
A buy-write trading strategy involves the writing of call options on a certain position which the trader has already taken on the market. The idea behind the strategy is to gain from option premiums.
The downside in this strategy is limited by the fact that the options position is technically covered by the position which the trader already has on the market.
Combining the expertise in building alrorithms for trading Equities Equities Equities can be characterized as stocks or shares in a company that investors can buy or sell. When you buy a stock, you are in essence buying an equity, becoming a partial owner of shares in a specific company or fund.However, equities do not pay a fixed interest rate, and as such are not considered guaranteed income. As such, equity markets are often associated with risk.When a company issues bonds, it’s taking loans from buyers. When a company offers shares, on the other hand, it’s selling pa Equities can be characterized as stocks or shares in a company that investors can buy or sell. When you buy a stock, you are in essence buying an equity, becoming a partial owner of shares in a specific company or fund.However, equities do not pay a fixed interest rate, and as such are not considered guaranteed income. As such, equity markets are often associated with risk.When a company issues bonds, it’s taking loans from buyers. When a company offers shares, on the other hand, it’s selling pa Read this Term with the options business of Convergex, the algorithm aims to buy equity positions and sell call options on the same stock simultaneously. Convergex's clients can therefore hedge their equities exposures and also pocket some additional income from options premiums with a limited downside.
Commenting on the announcement, the managing director and head of electronic Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term of Convergex, Oliver Sung, said, “Our diverse client base is always looking for new ways to extract more yield from the marketplace.”
“This buy-write algorithm provides a powerful new way for our clients to employ options in their investment strategy,” he added.