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Chapter 30: A Day in the Life of a Market Maker

In this section

  • Obligations of Market Makers in Options Trading
    Learn how market makers fulfill crucial liquidity responsibilities, meet quoting obligations, manage risk, and uphold fair market practices under current CIRO and exchange guidelines.
  • How Market Makers Reduce or Eliminate Their Exposure
    Explore the core strategies and real-time techniques used by market makers to manage inventory risk, maintain delta neutrality, and stay within strict regulatory guidelines in Canada’s expanding derivatives market.
  • Algorithmic Quoting & Risk Parameters
    Explore how market makers utilize automated quote engines, real-time risk modeling, and kill switches to manage exposure and maintain liquidity in volatile markets.
  • Dynamic Hedging of Option Portfolios
    Explore how market makers manage continuous risk in option portfolios through delta, gamma, and vega hedging, balancing transaction costs and regulatory guidelines.

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