Comment by chroma205

> I guess that's mostly true, but why does Jane Street get to have a moat in models but LLM companies can't?

Common misconception by people outside quant trading.

Modern “alpha” in trading does not come from better models but rather business connections with exchanges and regulators for preferential fees and/or revenue agreements.

If you are a “lead market maker” like Jane Street for ETFs, you can effectively skip the FIFO queue that retail traders and large passive index funds (VTI, VOO) must wait in.

Citadel has exclusive contracts to execute PFOF trades with e.g. Schwab. Even a simple exponential moving average model can be profitable with such a business arrangement.

OpenAI and Sam Altman tried to cut a deal (threaten?) with the US government, but looks like US government called Sam’s bluff.