The Top Proprietary Trading Firms
There are dozens (maybe hundreds?) of prop trading firms, so I’m not going to attempt to list them all here.
It’s also difficult to produce an exact list because some hedge funds use similar strategies, and the dividing line isn’t always clear.
For example, large hedge funds like Citadel and D.E. Shaw have their own “prop trading” groups and may use strategies similar to those of much smaller trading firms.
Among smaller/independent market-making firms, some of the top names include Jump Trading, Jane Street, Hudson River Trading (HRT), Tower (TTG), DRW, Optiver, Five Rings, Susquehanna International Group (SIG), TransMarket Group (TMG), Akuna, and IMC.
And then there other large/public entities that do a lot more than just prop trading, but which also have a presence in the market, such as Virtu [VIRT].
Most of these firms focus on “high-frequency trading,” though some, like HRT, use “mid-frequency trading,” where the average holding time is several minutes, and some positions are held overnight.
Most of these firms above have anywhere from a few hundred employees to 1,000+, so they’re several orders of magnitude smaller than the bulge bracket banks.
Besides different strategies and markets, they also differ based on the degree to which they use “trading” vs. “technology” to make money.
For example, HRT is more of a technology firm that happens to trade financial products, while Jane Street still has human traders (though they’re labeled “Quantitative Traders”).