About this episode
In this episode of The Derivative, Jeff Malec sits down with Bernie Yu, co-founder and CIO of Patronus Capital, to dive deep into the world of options trading, market making, and the nuanced art of capturing convexity. Drawing from his experience at Optiver and his journey to founding Patronus, Bernie shares insights into how a four-person team competes in the hyper-competitive options market by focusing on S&P 500 volatility. The conversation explores Bernie's unique approach to trading, the importance of liquidity, and how understanding market flow can create strategic advantages. From his Australian roots to the trading floors of Chicago, Bernie offers a fascinating look into the mechanics of options trading, risk management, and the evolving landscape of derivatives markets. SEND IT!Chapters:00:00-00:54=Intro00:55-06:14=Actuarial Science, Cricket, and the Trading Floor: Bernie's Multicultural Journey into Finance 06:15-21:40=Market Making Decoded: The Art of Liquidity and Convexity21:41-31:58=The 0-DTE Dilemma: Navigating Options Market Inefficiencies31:59-41:36=Competing with Giants: A Four-Person Team's Edge in Options Trading41:37-50:35=Liquidity Dynamics: The Hidden Engine of Financial Markets50:36-57:16=Future Horizons: Tax Advantages and Market Expansion Strategies57:17-01:05:41= Market Time Machine: Lessons from Black Monday and Future Market InsightsFrom the Episode: MMI Index Blog postBlast from the Past - How Futures saved StocksFollow along with Bernie on LinkedIn /Patronus Capital and check out the Patronus Capital website at www.patronus.capital!Don't forget to subscribe to?????????????????????????????????????????????????????????The Derivative?????????????????????????????????????????????????????????, follow us on Twitter at?????????????????????????????????????????????????????????@rcmAlts????????????????????????????????????????????
