3D Markets

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3D Markets
Headquarters New Hope, PA
Key People Past Chairman, CEO David Mortimer
Website http://www.3-dmarkets.com/

The firm 3D Markets creates and develops software and networks to provide technology solutions aimed at adding liquidity to existing options markets.[1] 3D Markets was acquired by Pipeline Financial Group in April of 2009. [2]

It received some attention after building 3D Markets Archangel, the first block options execution system. [3] Archangel is a dark pool that eliminates information-based market impact by matching liquidity providers with institutional investors anonymously.

In 2008, the firm grew by nearly 50 percent, making strategic hires across the organization as the firm started rolling out its Archangel Blind-Bid Cross into full production.


News

On May 20, 2008, 3D Markets and the CBOE announced they had signed an exclusive agreement that, when approved by the Securities and Exchange Commission, would allow CBOE to match large institutional buy and sell options orders electronically during a special matching session. The execution price would be determined at the end of the trading day, using a methodology known as “GWAP” pricing (Gamma Weighted Average Price), similar to Value Weighted Average Price (VWAP) used heavily in the securities market.[4]

Under the agreement, the CBOE would provide the regulatory framework necessary for option benchmark trades. The GWAP (Gamma Weighted Average Price) auction and pricing methodologies would be proprietary to CBOE.[5]


History

Products and Services

3D Markets is the developer of Archangel, a platform that supports two institutional products, the Archangel Blind-Bid Cross and the Archangel Benchmark Cross.

The first round of Archangel users are said to be relatively well known large option market-making firms, as well as several active option trading hedge funds. Participants will be subject to a net capital test to ensure they have sufficient capital and trade large blocks of options.[6]


Key People

  • David Mortimer was chairman and CEO of 3D Markets Inc. and is now managing director of options at Pipeline Financial.

References

  1. Company Overview. 3D Markets Inc.
  2. Announcement. Pipeline Financial Group.
  3. David Mortimer: Bringing Dark Pools To Options. Wall Street Letter.
  4. CBOE and 3-D Markets Bring the GWAP to Options. Advanced Trading.
  5. CBOE Seals Exclusive Agreement With 3D Markets For Benchmark-Priced Trades With "GWAP" Options Pricing. CBOE.
  6. STA Panel: Bright Future for Dark Pools. Advanced Trading.