UBS Investment Bank has launched a new suite of algorithms and tactical order types for trading US listed options that will be added to its existing suite.
The firm first began offering algorithmic trading strategies for US listed options over three years ago. The offering is now being expanded to include an array of more nuanced liquidity and volume-sensitive order types. One addition is UBS Options TapNow, an urgent liquidity-seeking strategy that is a variation of the firm's cash equities algorithm, UBS Tap.
“In response to the significant increase in growth and sophistication of the market, as well as our clients' requests for more efficient ways to route their orders, we developed these new options algorithms,” said Owain Self, global head of algorithmic trading for UBS. “We are excited to expand our options offering to include a diverse array of new order types that will enhance our clients' trading performance.”
The new algorithmic strategies and tactical order types are available on UBS's own Pinpoint execution management system (EMS), and are live and being deployed with over a dozen third party order management systems and EMS platforms that already carry UBS US listed options algorithms.
There are seven new order types available of which three are market sweeping: Sweep Display, designed to aggressively sweep at the market until the order is filled or no longer available, posting on multiple markets simultaneously; Sweep No Display, which follows the same pattern but holds back unmarketable orders until the displayed price is in the user's limit; and Sweep IOC which executes a wave of immediate or cancel orders across multiple markets simultaneously, cancelling any residual unfilled shares.
The other four are: Options TapNow, which seeks to minimise market impact while seeking aggressive execution up to a limit price; Options Premium Trigger, that places an options order that is relative to the price of the option premium, rather than the underlying security; Options Float, which can float an order in the market pegged to the passive side of the spread; and Options Hidden, that holds an order off the exchange until a desired price is available.
UBS's existing suite of DMA order types and algorithms, including Options TWAP and Options Delta Adjust, will continue to be available.