Hudson River to acquire Sun Trading as HFT continues to contract

Latest acquisition follows spate of similar deals in HFT space beset by costs and volatility woes.

Multi-asset quant trading firm Hudson River Trading (HRT) is to acquire market-making firm Sun Trading as high-frequency trading (HFT) continues to shrink in the face of low market volatility and increasing costs.

The deal is the latest in a series in the HFT space, with notable acquisitions completed last year including DRW Holdings and Virtu Financial procuring RGM Advisors and KCG Holdings respectively.

The deal is expected to be finalised in Q1 2018, subject to regulatory approval. Terms of the acquisitions were not disclosed.

“Sun Trading is a highly regarded market making firm with an approach to trading that is complementary to HRT’s,” said Jason Carroll, co-founder and managing director of HRT. “This acquisition combines HRT’s expertise in on-exchange trading with Sun’s expertise in off-exchange trading creating a stronger, more diverse firm.”

Chicago-based Sun Trading provides liquidity to over 115 exchanges, trading venues, and counterparties in over 15 countries, and Kevin Cuttica, chief executive of the firm’s parent company, Sun Holdings, said the two firms share a culture of collaboration.

“The combined firm will continue Sun’s focus providing meaningful liquidity to our trading partners through our US equity Single Dealer Platform, our European equity systematic internaliser, and an enhanced global distribution network across other market places,” he said.