Leverage the Principals’ deep experience and expertise in options and derivatives markets – which spans foreign exchange, interest rates, VIX and digital assets – to deliver uncorrelated alpha via the application of sophisticated institutional grade options trading techniques to digital asset options.
Active player in the digital assets space, ranked as a top 5 taker and top 15 maker on Paradigm block trades for BTC and ETH Options
Relative value options trading:
- Volatility term structure, smile and surface trading
- Cross-coin volatility spread trading
- Event driven relative value
- Further opportunities as the market develops (e.g. Barrier Options, Strikeless and Correlation Products)
Absolute value volatility trading:
- Use proprietary metrics and active relationships with dealers to interpret market flows as well as historical backtests to find opportunities to pick up mispriced optionality
- Utilize the option markets to structure highly convex delta positions with attractive risk-reward profiles
- Trend Following
- Mean Reversion
- Exchange Segmentation
- Regime Clustering
Fat tails of digital assets make it an ideal market for disciplined Trend Following strategies:
- Run systematic trend following models in BTC a n d ETH . These models can be denominated in USD or BTC.
- Proprietary risk management rules lead to a disciplined approach to trend following trading. The resulting drawdowns are far lower than vs passively holding long physical BTC exposure.
Orthogonal has a suite of additional systematic strategies with proprietary signals ranging from funding rates, exchange segmentation, and high frequency seasonality
Performance and high-level overviews available upon request
CEFI AND DEFI
- Statistical Funding and Basis Arbitrage
- Yield Farming
- Cash and carry arbitrage
- Rates relative value trading
- Cross-exchange arbitrage
- Quanto arbitrage
Inefficiencies inherent in the digital asset markets create multiple opportunities for arbitrage and relative value trading strategies to be systematically implemented.
This strategy has a broad scope, with both automated and routine use cases as well as special situations. Some include:
- Trading BTC Quanto Perpetual Swaps /Futures vs the USD Equivalent Product to create a synthetic covariance product
- Diversifying into several leading DeFi yield farming protocols to earn attractive carry, while containing protocol risk
- Trading the futures curve, for example earning 8hr funding on the perpetual swap, while getting paid rates further out in the futures curve to express a positive carry bullish view