Global Electronic Trading Company (GETCO)
Company typeSubsidiary
IndustryHigh-frequency trading, Market making
Founded1999
HeadquartersChicago, Illinois, United States
Key people
Stephen Schuler, Co-founder
Daniel Tierney, Co-founder
Daniel Coleman, CEO[1]
Number of employees
400+ (2013)
ParentKCG Holdings
Websitewww.getcollc.com

The Global Electronic Trading Company (GETCO), or Getco LLC, is an American proprietary algorithmic trading and electronic market making firm based in Chicago, Illinois. In December 2012, the firm agreed to acquire Knight Capital Group; this merger was completed in July 2013, forming the new company KCG Holdings.[2][3]

Description

The firm was founded in 1999 by Stephen Schuler and Daniel Tierney, former floor traders in Chicago, and grew quickly in the early 2000s to become one of the most active trading firms in the world.[4]: 196–197  The firm's primary business is electronic market making, though it also provides execution algorithms and a dark pool through its client services arm, GETCO Execution Services.[citation needed]

Prior to the merger into KCG, GETCO traded in over 50 markets in North and South America, Europe and Asia, and was consistently among the top 5 participants by volume on many venues, including the CME, Eurex, NYSE Arca, NYSE Arca Options, BATS, Nasdaq, Nasdaq Options, Chi-X, BrokerTec, and eSpeed. It had offices in New York City, Chicago, London, and Singapore, and was an investor in the electronic exchanges BATS Exchange, Chi-X, NYSE Liffe U.S., Eris, and ELX.[5]

In a 2009 profile by the Wall Street Journal,[6] the firm was identified as one of the largest market makers in the US stock market. GETCO also served as one of the six Designated Market Makers (DMMs) on the NYSE between 2010 and the merger.[7] In 2012, Scott Patterson described the firm as "the largest and most powerful high-frequency trading firm".[4]: 44 

GETCO was one of the six investors that participated in the rescue of Knight Capital, a competitor that had experienced a significant trading malfunction on August 1, 2012 which resulted in a $460 million loss.[8] Supported by its main investor, General Atlantic, GETCO pursued Knight Capital and defeated a competing proposal from Virtu Financial by offering to pay $3.75 per share to Knight Capital’s shareholders, for a total value of $1.4 billion.[9]

References

  1. ^ "GETCO Names Coleman CEO" (PDF). Archived from the original (PDF) on 2012-03-24. Retrieved 2012-02-29.
  2. ^ CNBC (2012-12-19). "Getco and Knight Capital to Merge in $1.4 Billion Deal". www.cnbc.com. Retrieved 2020-01-28.
  3. ^ Dealbook (2012-12-19). "Knight Capital and Getco to Merge". DealBook. Retrieved 2020-01-28.
  4. ^ a b Patterson, Scott (2012). Dark Pools: High-Speed Traders, A.I. Bandits, and the Threat to the Global Financial System. Crown Publishing. ISBN 978-0307887177.
  5. ^ "GETCO". Archived from the original on 2011-07-06. Retrieved 2011-06-26.
  6. ^ Patterson, Scott (2009-08-27). "Meet Getco, High-Frequency Trade King - WSJ.com". Online.wsj.com. Retrieved 2011-06-26.
  7. ^ "NYSE Equities Membership Types". Archived from the original on 2011-10-19. Retrieved 2011-10-15.
  8. ^ "Knight Capital to pay $12 million to settle SEC charges".
  9. ^ "Getco to buy Knight Capital in $1.4 billion deal". Reuters. 2012-12-19. Retrieved 2020-06-03.

External links

Hedge funds
Categories