KCG down due to rumor of algo gone wild

You sound so bitter, atticus. Have they harmed you personally by providing liquidity?

Do you *know* personally anybody who works at Knight? I do.


They're not a bunch of MBA-type, Vampire Squid jerks.

They're good, honest people. And yes, they're traders.


So are you. (I think). So am I.


I can see why people hate Goldman Sachs, with its unfair advantages, bailouts, political cronyism, etc. But Knight?!
It was one of the few good names left on the STreet.
 
Quote from Chicago_CTA:

You sound so bitter, atticus. Have they harmed you personally by providing liquidity?

Do you *know* personally anybody who works at Knight? I do.


They're not a bunch of MBA-type, Vampire Squid jerks.

They're good, honest people. And yes, they're traders.


So are you. (I think). So am I.


I can see why people hate Goldman Sachs, with its unfair advantages, bailouts, political cronyism, etc. But Knight?!
It was one of the few good names left on the STreet.
More...
Don't take it the wrong way. I don't wish that any one of them loses a job, but they've always had that mentality, it permeates the firm. My guess is that Citadel offers $300 and an assumption of debt. I hope someone else like Barc comes in to save them. I pray that douche KG doesn't get his claws into their infrastructure.

On a smaller scale I am amazed that Peak6 hasn't blown up. They're similar in terms of risk-taking.

Absolutely w.r.t. JPM and GS. JPM simply got lucky that the CDS Index thing didn't happen in 2008. They're interchangeable to me and it's unconscionable that Dimon is still there, bailout or not.
 
i used to work at Knight. i am not surprised this has happened.

Fuck them all, except for the few friends i have there. i should make a few phone calls to see how they are doing.
 
Not sure what their reputation is today, but when I heavily traded micro/small caps in early 2000's, NITE was notorious for unloading wholesale shares for several pump & dump operators. Covered themselves on legal, but highly unethical, as their DD on several reverse-shell operators was poor at best. Their tendency to turn a blind eye to suspect clients earned them a dirty rep back then. Made good $ off their L2 interactions as their front-line presence halted otcbb rallies dead in tracks. NITE was the nemesis of pinky traders, perhaps still today? Those trading days still make me laugh, don't know how I got out of it alive... wild west.

Today's trade strikes me as buyout vultures circling, picking up public float for deal leverage. Quite ugly. Not sure it survives the weekend.
 
Quote from atticus:

KCG has always been a shop full of gunslingers. They're done.
More...

its a bit more complicated than that now with Knight.

essentially the gunslingers now are the Programmers & their supervisors.

while i was there i saw numerous algos, internal systems etc being put into production without approval or full testing. there was no manager there that understood the technology AND trading. managers either knew one or the other and thus were always finger pointing when something crapped out.

and the tards at sales & operations would have to deal with the angry customers unable to explain why orders were duplicated/triplicated, missing, etc. because the traders/programmers didnt communicate to sales & ops
 
Quote from Chicago_CTA:

You sound so bitter, atticus. Have they harmed you personally by providing liquidity?

Do you *know* personally anybody who works at Knight? I do.


They're not a bunch of MBA-type, Vampire Squid jerks.

They're good, honest people. And yes, they're traders.


So are you. (I think). So am I.


I can see why people hate Goldman Sachs, with its unfair advantages, bailouts, political cronyism, etc. But Knight?!
It was one of the few good names left on the STreet.
More...


Respectfully disagree. They're all wonderful people at Knight until they owe you money.

I'm a plaintiff against Knight in an unrelated matter, they tried every trick in the book to stall discovery in a case, some of which would provide monies to the aggrieved public, and not just broker-dealers, and their posture was uniformly one of malfeasance. It's free to put on a benign face.

I've seen Knight with the mask off. As a plaintiff (and not in some diluted class action), I might recover money from Knight if they survived. And I hope they don't make it!
 
I heard they got a blue screen of death on their windows 2008R2 servers. And it took a long time to reboot the cluster.

Anyone have any confirmation on this?
 
Quote from Syprik:

Not sure what their reputation is today, but when I heavily traded micro/small caps in early 2000's, NITE was notorious for unloading wholesale shares for several pump & dump operators. Covered themselves on legal, but highly unethical, as their DD on several reverse-shell operators was poor at best. Their tendency to turn a blind eye to suspect clients earned them a dirty rep back then. Made good $ off their L2 interactions as their front-line presence halted otcbb rallies dead in tracks. NITE was the nemesis of pinky traders, perhaps still today? Those trading days still make me laugh, don't know how I got out of it alive... wild west.

Today's trade strikes me as buyout vultures circling, picking up public float for deal leverage. Quite ugly. Not sure it survives the weekend.
More...

LOL! I was one of those small-cap day traders back then, (before my broker clamped down on the PDT rule), and they handed me my ass in a little stock, (XTND, no longer traded). It was about 5 a share and had a wide enough spread that I would try to get in between the bid and ask and catch the next market order. I first put in the best bid, got my shares, turned right around and put in the best offer, and 2 seconds later the stock dumped about a full point, all the bids fell away. BTW, over the next few months that particular stock rose to over 70. My broker was Scottrade, who used NITE, and I was so I should have known that I couldn't day trade NITE's own small caps like that. NITE was the best trading coach a piker could ever hope to have. Friggin' assholes! :p
 
Quick and dirty balance sheet analysis here:

I got Cash: 555M
AR: 888M

For current assets: 1443M

AP: 721M
ST Debt : 646M (ex out GNMA trust as that is netted by HECM inv a LT asset)

For current liabilities : 1367M

For CA- CL = 76M surplus
Inv not included, liquidation means end of Knight

If we take 440M loss straight to cash, we have 115M in cash still.

The credit facilities has a negligible interest exp monthly, the 3.75% notes has a payout of roughly 6.56M on Sept 15. Assume the lease obligation is paid EOY take out another 24.2M. It seems that Knight should be liquid here. I don't know what the min cap requirement is though and it looks like that is the variable at play.

Please knock a hole in this, as I'm short AUG vol and need to see the bear case.
 
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