Allston Trading, LLC
| Allston Trading | |
| |
| Founded | 2002 |
|---|---|
| Headquarters | Chicago |
| Employees | 100 - 200 |
| Products | Proprietary trading |
| Profile | |
| Website | www.allstontrading.com |
Allston Trading was a prominent proprietary trading firm headquartered in Chicago, Illinois, with a significant presence in global financial markets that was acquired by DV Trading in 2021. Founded in 2002, Allston specialized in algorithmic trading, market making, and high-frequency trading strategies. It was known for its cutting-edge technology and expertise in executing trades across various asset classes, including equities, futures, options, and fixed income securities.
Founded in 2002 by former CME floor traders, Allston Trading was owned by its current and former employees, retired founders, and long-term institutional backers Sequoia Capital and Francisco Partners prior to its sale to DV Trading. [1]
The firm was a member of the Principal Traders Group, an affiliate of the Futures Industry Association.[2]
History[edit]
Allston was co-founded in 2002 by futures traders Bob Jordan, Elrick Williams and John Harada.
In September of 2012, Allston named Raj Mahajan, former Goldman Sachs partner and SunGard executive, as CEO, replacing Carlton Jones, who moved to chairman and also retained the title of president.[3]
Mahajan returned to Goldman in January 2015, whereupon the CEO title was returned to Jones.
Also in January 2015, the firm announced it had stopped operating in the U.S. stock market in order to concentrate in the more profitable derivatives markets. Allston had previously been named as one of the high frequency trading firms under investigation by the Securities and Exchange Commission and New York Attorney General Eric Schneiderman.
Legal Issues[edit]
In 2014, Allston was the subject of an arbitration case filed by HTG Capital Partners, who accused the firm of violating CME Group's new rule against spoofing and other disruptive trade practices.[4]
In March of 2015 it was reported that Allston was being investigated by the U.S. Commodity Futures Trading Commission for alleged market manipulation. The CFTC subpoenaed CME Group Inc. for information on the firm.[5]
On May 18, 2015, Mark Mendelson, a member of the Chicago Board of Trade, filed a lawsuit in the Northern District of Illinois against Allston and one or more of the firm's traders ("John Does 1-10"), accusing the firm of engaging in "spoofing" and other unlawful trading practices in the Treasury Bond Futures market. View the lawsuit here: File:Allston Trading Spoofing Lawsuit.pdf In his complaint, Mendelson cited the report that the CFTC was investigating Allston.
Allston won dismissal of that case in August of 2015 and also resolved the arbitration case filed by HTG.[6]
Key People[edit]
Nancy Laethem Stern was the CEO at the time of the sale to DV Trading and she did not stay with the new combined firm.
John Lothian News Interview[edit]
Raj Mahajan, Allston Trading CEO, Talks HFT and the Business of Prop Trading Raj Mahajan took the reins at Allston Trading as CEO in September 2012 and has spent a good deal of his time looking at the issue of high frequency trading (HFT). Allston has been one of the proprietary trading firms who has been willing to publicly discuss HFT, regulation and the future of that form of trading. Mahajan spoke with JLN’s editor-in-chief Jim Kharouf about HFT as well as the business challenges and opportunities for prop firms.
References[edit]
- ↑ Allston Trading. Allston Trading.
- ↑ Membership. Futures Industry Association.
- ↑ Raj Mahajan Appointed CEO of Allston Trading. Allston Trading.
- ↑ Allston Accused by HFT Rival of Manipulating CME Prices. Bloomberg.
- ↑ Allston Said to Face CFTC Probe Into Alleged Manipulation. Bloomberg.
- ↑ High-speed trading firm beats back allegations of manipulation. Crain's Chicago Business.