Careers at Jump Trading
Jump Trading’s mission is to leverage its petaflops of computing power and petabytes of data to carefully analyze and identify trends in the global markets across all asset classes.
William DiSomma and Paul Gurinas were traders in the Deutsche Mark pit at the Chicago Mercantile Exchange (CME). As pit traders, they would shout and wave their arms in order to obtain the best prices. Despite this role, they had a reputation for their level heads. Around 1992, financial markets began transitioning to electronic trading. The two men sensed an opportunity in this migration.
Specifically, they thought there was potential in using computers to take advantage of price discrepancies in different markets – a strategy known as “arbitrage”. They worked on their idea for several years, then left CME in 1999 to start their own company, along with colleague John Harada. It was called Akamai Trading LLC, and CME Group board member William Shepard bought a stake.
Akamai was a proprietary trading firm with an emphasis on technology that utilized algorithmic and high-frequency trading tactics. Harada left not long afterwards to co-found a competitor, Allston Trading. In 2001 DiSomma and Gurinas changed their firm’s name to Jump Trading, a reference to how they used to draw attention to themselves on CME’s floors. Akamai now has global offices.
Benefits at Jump Trading
Business model of Jump Trading
Jump Trading has a niche market business model, with a specialized customer segment. The company targets its offering at consumers interested in high-frequency trading.
Jump Trading offers three primary value propositions: accessibility, innovation, and brand/status.
The company creates accessibility by providing a wide variety of options. It is a registered broker-dealer that is a member of multiple exchanges. These include U.S. exchanges such as the New York Stock Exchange and Chicago Mercantile Exchange, and European ones such as Eurex and the London Stock Exchange.
The company places a strong emphasis on innovation. It has a quantitative basis and creates technology solutions that can execute algorithmic trading strategies. It has invested significantly in high-speed trading infrastructure and technology; for example, in 2013 it purchased a Belgian microwave tower formerly owned by the North Atlantic Treaty Organization (NATO).
The company has established a strong brand due to its success. A privately-funded firm, it is one of the top companies on the Chicago Mercantile Exchange, with over $500 million in annual revenues. It has over 500 employees who belong to over 20 teams. They operate in the equities, options, and futures markets in Chicago, London, New York, and Singapore, and trade across all major asset classes in Europe, Asia, and the Americas. Lastly, the firm is a member of the Principal Traders Group, an advisory group created by the Futures Industry Association to represent principal traders.
Jump Trading’s main channel is its website. The company promotes its offering through its social media pages and participation in conferences.
Jump Trading’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through the main platform while having limited interaction with employees.
Jump Trading’s business model entails maintaining a robust platform for its customers.
Jump Trading often forms partnerships in order to achieve strategic goals.
For example, it partnered with the University of Illinois College of Medicine and College of Engineering to design the Jump Trading Simulation and Education Center. Situated on the OSF Saint Frances Medical Center Campus, the facility is a medical training, research, and development center.
Jump Trading also formed a partnership with Farnsworth Group, which assisted with planning and construction of the center.
Jump Trading’s main resource is its proprietary software platform, through which it conducts trading.
It depends on its human resources in the form of technology employees that maintain the platform, as well as programmers, scientists, and mathematicians that build its complex trading algorithms. Employees’ backgrounds include tech firms, the trading industry, research labs, and Ph.D. programs.
Lastly, Jump Trading depends on private funding rather than private equity or outside investors.
Jump Trading has a cost-driven structure, aiming to minimize expenses through significant automation. Its biggest cost driver is likely transaction expenses, a fixed cost. Other major drivers are in the areas of customer support/operations and research/development, both fixed expenses.
Jump Trading has one revenue stream: revenues it generates from fees charged for regular access to its proprietary trading platform.
info: William DiSomma earned an undergraduate degree at the University of Illinois Urbana-Champaign. He previously served as a floor trader in the Deutsche Mark pit at the Chicago Mercantile Exchange, as well as a trader at the Standard & Poor‘s 500 pit.
info: Steve Hunt earned a B.S. in Information Decision Sciences at the University of Illinois Urbana-Champaign. He previously served as Vice President of Technology at Goldman Sachs and as a Technology Manager at the Hull Group.
info: Tessa Wendling earned a Bachelor of Science in Business at Kansas State University and a JD at DePaul University. She previously served as an HR Manager at Jump Trading and Applus Technologies and as an HR Generalist at Move Line.
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