On Wednesday, CBOE Holdings, Inc.announced its plans to invest in Tradelegs, the developer of advanced decision-support software employed by institutional investors to optimize investment performance.
Institutional subscribers to Tradelegs Derivatives Strategist software, including hedge funds, mutual funds, pension funds and insurance firms, can enter their views on securities into Tradelegs’ analytics platform. The Derivatives Strategist calculates the result of numerous combinations of options/underlying positions that correspond to the user’s specific trading view and risk parameters (such as maximum capital available, worst-case risk and probability of price movements) and then identifies a possible trade (s) that will include the parameters.
CBOE Holdings CEO Edward T. Tilly said in a press release,?”Our planned investment in Tradelegs is a natural fit for CBOE. The technology’s application supports our strategic objective to further expand the institutional use and appeal of options trading, including with our proprietary index products. Tradelegs’ advanced analytics and intuitive software make it a valuable trading resource for institutions that want an uncomplicated way to formulate options-based strategies that could enhance their equity positions.”
Gideon Agar, CEO of Tradelegs, added,?”We couldn’t be more pleased that CBOE, the world’s leader in index option and volatility trading, recognizes our potential to penetrate the institutional market with a program that could help users more efficiently generate options strategies that might be employed to optimize investment performance.CBOE’s investment should allow us to further expand our options optimization services, including the capability to cover portfolios of securities sometime this year.”