Jane Street, Citadel Securities Won’t Devour All of Wall Street’s Revenue
The two electronic market makers have grabbed market share by being nimbler than rivals. But there are limits to their business model.
Jane Street and Citadel Securities are winning market share from their more established peers.
Photographer: Gabby Jones/BloombergJane Street Group LLC and Citadel Securities are on a tear. First-half revenue at the two predominantly electronic market makers grew about 80% compared with the first six months of 2023, according to Bloomberg News. That’s enough to make traditional Wall Street executives green with envy — but these upstarts aren’t going to completely devour the old guards’ lunch.
The biggest investment banks such as Goldman Sachs Group Inc. and JPMorgan Chase & Co. have spent years cultivating more complex, higher-margin trading and lending activities that these newer market makers don’t touch. And unless their business models change, they probably never will.