What Dodd-Frank took from the banking industry it has given to the likes of Citadel LLC. The Wall Street Journal reports:
The Chicago hedge-fund firm’s Citadel Securities unit has the largest market share by number of trades and the third largest by dollar volume in the second quarter, according to documents reviewed by The Wall Street Journal showing the firm’s rankings on a swaps platform operated by Bloomberg LP. As of the first quarter, the firm said it was No. 3 by number of trades and No. 4 by dollar volume.
The new law governing interest rate swaps is making it easier for non-bank entities to claim market share as banks reconsider their mix of business.
Citadel got slammed pretty hard during the financial crisis of 2008 but has proven itself a juggernaut in rebuilding itself. The $26 billion firm is carving out a big business in market-making, and now claims 14% of daily stock volume plus 20% of listed stock options, and is dominant in Treasurys. Former global head of equities, Jeff Runnfeldt is returning from a three-year retirement to run a new stock-picking unit to be based in San Francisco.