This is from $VIRT's 10-K - Id say the below firms are a good starting point/the largest players:pic.twitter.com/Sl6pDL9lCV
HFT is the new active manager. - They manage a lot of $ - They don't track an index - They adapt with the market - They're 50% of market volume - They're in the market to make $ - They focus on risk management
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bullet 1 might warrant further work
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A good point - if they don't manage a lot of $ relative to the big classic active funds that would imply their returns are just that much better on a smaller base.
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it’s really not a ton of money compared to the size of lot of institutions
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Massive leverage. Which is why you've seen some of them get into trouble with single-digit billion balance sheets converting ETFs
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HFT are small relative to pensions, HFs, and asset managers. They are high % of volume because their job is liquidity provision, not directional risk taking. They are small/trivial % of open interest.
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They’re all prop shops (razor thin capital base + highly leveraged) and not really taking external capital
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