Chicago's high-speed trading industry is so secretive, it's easy to overlook the worldwide magnet the city has become for the business. Two Dutch companies, Optiver and IMC, set up shop downtown more than a decade ago and have grown to more than 200 employees each. Now, they're expanding again. They're among a contingent of companies and professionals from other countries who have joined the city's trading ecosystem, even as electronic trading makes it simpler to trade futures and options anywhere. Chicago's legacy as the birthplace of those derivatives nurtured talent and technology that remain a draw despite the decline of its open outcry pits. The industry has allowed Chicago to develop a "technology niche in which, basically, it's been the best in the ​ world," says Ilya Talman, an industry recruiter in Chicago. "The vast majority of (firms) have somebody who wasn't born in the United States in leadership." In addition to Optiver and IMC, Asian futures broker PhillipCapital and the European co-founders of the new exchange Seed CX planted stakes in the city. Perhaps more important, foreign and homegrown trading firms alike are increasingly filling their ranks with foreign professionals. Chicago trading firms, sometimes referred to as market-makers because they take the other side of buy and sell orders, are typically privately held and historically avoided publicity because they don't have customers or outside investors. They seek price discrepancies in all sorts of markets, from options to swaps, to profit in trades for the benefit of their owners. Despite their press-shy tendencies, they've opened up a bit in recent years as the competition to lure top computer science, math and engineering graduates intensifies. A slowdown in the markets tied to low volatility and volumes also led some of them to stretch their trading expertise into businesses that do have customers and require more transparency. Still, it's nearly impossible to gauge their overall contribution to the city's economy, but it's clear the biggest international players contribute hundreds of jobs and probably billions of dollars in commerce. Optiver's founders from the Dutch town of Delft, known for its blue and white pottery, initially set up U.S. outposts in Chicago and New York in 2001 but shut down the East Coast office in 2003. Revenue and headcount have grown steadily since then, says Managing Director Sebastiaan Koeling, a Dutchman who moved from Amsterdam to head the Chicago office in 2003. Today, despite a regulatory slap in 2012 that cost it $14 million, Optiver has about 225 employees in Chicago, and it is building out its space at One Prudential Plaza to accommodate 75 more. Even though Optiver relies on rapid-fire trades, like every other big firm in the industry, Koeling, 38, says sending a group of traders to the city's trading floors every day is a "critical" part of the business. Those floors operated by CME Group, the biggest futures market in the world, and CBOE Holdings, which runs the Chicago Board Options Exchange, have been shrinking over the past decade as more trading shifts to computers. Optiver is mainly focused on index and futures options trading, but it's mulling a move into swaps, too. "That's a natural expansion field for us," Koeling says.
Dutch firms Optiver and IMC are flourishing in Optiver's increasingly computerised trading sector, with both companies eyeing expansion. Optiver, which focuses on index and futures options trading, still sends traders to the city floor and is looking to hire more, despite the growing trend to digitisation, while IMC is also making the most of being based in the birthplace of futures and options derivatives.