AppliedMultiple choice
Quoting with inventory · Part 2 of 3
You make a market in a future you value at 50.00, normally quoting 49.80 @ 50.20. After a run of trades you hold a large long position.
Your lowered offer is lifted four times in a row, 7 lots each time, always by the same fast counterparty. What should you conclude first?
- AYour value is probably too low, so raise it rather than keep skewing
- BYou are being lucky, since every sale at 50.10 is above your 50.00 value
- CYou should lower the offer further to clear inventory faster
- DThe counterparty is making a mistake that you should encourage
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