Jane Street barred from Indian markets as regulator freezes $566M

Extremely funny that Jane Street's "elite strategy" leaked and it's just banging the close lol

Tower got caught doing the same thing about 10 years ago. Apparently the strategy was literally called "the hammer" or something that was far too on-the-nose, but it was exploiting other strategies at the firm that bought a ton in the morning and hammered the close - "the hammer" made that leg profitable.

I assume Jane Street's version of this may have been unintentional: get your big position to do a bunch of intraday trading without worrying about being too short, then exit at the end of the day. This can work because markets tend to go up or stay flat intraday, meaning you get to use typical strategies in a jurisdiction that doesn't like when you go short via superposition. Then along the way, someone figured out this options trade and didn't realize their own behavior was influencing the price of the option (oops, I guess it wasn't superposition all along).

You're thinking of Optiver's The Hammer, though every HFT firm has basically done or is doing something like this. [1]

Jane Street's version of this was absolutely intentional.

[1] https://www.reuters.com/article/business/high-frequency-trad...