Hello and welcome to the Virtu Financial First Quarter 2023 Results. My name is Elliot, and I'll be coordinating the call today. [Operator Instructions] I would now like to hand over to Andrew Smith, Head of Investor Relations. The floor is yours. Please go ahead.

Thank you, Elliot, and good morning. Thank you -- thank you everyone for joining us. Our first quarter results were released this morning and are available on our website. With us today on this morning's call, we have Mr. Douglas Cifu, our Chief Executive Officer; Mr. Joseph Molluso, our Co-President and Co-Chief Operating Officer; Ms. Cindy Lee, our Deputy Chief Financial Officer; and Mr. Sean Galvin, our Chief Financial Officer. We will begin by -- we will begin with prepared remarks and then take your questions. First, a few reminders. Today's call may include forward-looking statements, which represent Virtu's current belief regarding future events and are, therefore, subject to risks, assumptions and uncertainties, which may be outside the company's control. Please note that our actual results and financial conditions may differ materially from what is indicated in these forward-looking statements. It is important to note that any forward-looking statements made on this call are based on information presently available to the company, and we do not undertake to update or revise any forward-looking statements as new information becomes available. We refer you to disclaimers in our press release and encourage you to review the description of risk factors contained in our annual report, Form 10-K and other public filings. During today's call, in addition to GAAP measures, we may refer to certain non-GAAP measures, including adjusted net trading income, adjusted net income, adjusted EBITDA, adjusted EBITDA margin. These non-GAAP measures should be considered as supplemental to and not as superior to financial measures as reported in accordance with GAAP. We direct listeners to consult the Investor portion of our website, where you'll find additional supplemental information referred to on this call as well as a reconciliation of non-GAAP measures to the equivalent GAAP term in the earnings materials with an explanation of why we deem this information to be meaningful, as well as how management use these measures. And with that, I'd like to turn the call over to Doug.

Thank you, Andrew, and good morning, everybody. This morning we reported our first quarter results for the quarter ended March 31st, Virtu earned $0.74 of adjusted EPS and $6 million per day of adjusted net trading income. Focusing as always on expense discipline, we generated a 56% adjusted EBITDA margin and $207 million of adjusted EBITDA. I’m pleased with our results this quarter as compared to the fourth quarter of 2022. This quarter's headline market metrics were mixed overall. Realized volatility was down significantly 32% and U.S equity lines were up 5%. As always, we look at specific internal metrics for each of our businesses and I’m happy to report that this quarter we met or exceeded our benchmarks in all cases. Our proprietary Market Making business did especially well in the quarter, driven by particularly strong performance in global currencies and continued strong performances in global [ph] commodities as well as European equities. We continue to see the benefit of increased internalization opportunities across the firm's various trading desks [ph]. In addition, our growth initiatives continue to contribute meaningfully and generated 11% of our adjusted net trading income this quarter with continued growth in options market making as the biggest driver. Our customer Market Making business performed well against the opportunity presented which was materially better than the fourth quarter of 2022. I'm very pleased with the $278 million in adjusted net trading and from Market Making this quarter, a 53% increase from last quarter. Execution services also improved over the fourth quarter delivering $95 million of adjusted net trading income. While institutional activity remained muted, volatility in March did prompt some increased activity as clients adjusted their portfolios. We are currently pursuing several exciting initiatives that we believe will contribute to the growth of this segment, specifically ongoing…

Thank you, Doug, and good morning, everyone. On Slide 3 of our supplemental materials, we provided a summary of our quarterly performance. For the first quarter of 2023, our adjusted net trading income [indiscernible] which represents our trading gains, net of direct trading expenses, totaled $373 million or $6 million per day, which is a 38% increase from the prior quarter. Market Making adjusted net trading income was $278 million or $4.5 million per day, 53% higher than the prior quarter. Execution Services, adjusted net trading income was $95 million or $1.5 million per day, which is an 8% increase from the prior quarter. Our first quarter 2023 normalized adjusted EPS was $0.74. Adjusted EBITDA was $207 million for the first quarter of 2023, which was a 65% increase from the fourth quarter and our adjusted EBITDA margin was 56%, which was up from 46% in the fourth quarter of 2022. On Slide 8, we provided a summary of our operating expense results. For the first quarter of 2023, we recorded $181 million of adjusted operating expenses, which was essentially flat year-over-year. We continue to maintain an efficient cost structure disciplined expense management, which has helped us control our operating expenses during this inflationary environment. Financing interest expense was $24 million for the first quarter of 2023 compared to $21 million prior year first quarter. With the benefit of our interest rate swap contracts, which we entered into in the prior years, our blended interest rate was just over 5% for our long-term debt in aggregate. Our capitalization remains adequate. In the first quarter of 2023, we repurchased 3.9 million shares for approximately $76 million. Since the inception of our share repurchase program in November 2020 through settlement date, April 19, we have repurchased a total of 36.9 million shares for approximately $987.2 million. We remain committed to our $0.24 per quarter dividend. And combined -- the combination of this dividend and the share repurchase program demonstrates our continued commitment to return capital to our shareholders. Now we would like to turn the call over to the operator for the Q&A.

[Operator Instructions] Our first question today comes from Rich Repetto from Piper Sandler. Your line is open.

Yes. Good morning, Doug and team. So first, congrats on the strong quarter here. And I guess my question, Doug, is when you look at the $0.74 you put up this quarter and you look at the last four quarters, has it told you -- is there anything more to learn about the normalized earnings potential of the company. So if you look at the last four quarters, like $2 -- a little bit over $2.40, but is there anything that investors should take from, I guess, the strong quarter or any other last year, I guess?

Yes. Thank you, Rich. It's a great question. I appreciate it. I think this quarter is just a reminder that, as I said, in my prepared remarks that Virtu has had a broad business, and we are able to capitalize on opportunities. I think for better or worse, this [indiscernible] around retail trading. I don't mean to minimize it, obviously, but obviously, it's been kind of front and center helps perpetuate the front and centerness of it by being in the firm by being very front footed on it, has overshadowed a lot of what Virtu is. And you remember, because you've been following us since we first went public, we didn't have a retail business until 2017. And we have a very broad-based market making business that can generate -- continue to -- is growing and can generate outsized returns. The other thing that I highlighted in my remarks, and I've mentioned on previous calls and in discussions with you all is we have a very, very strong one-firm culture here. I almost -- in my prepared remarks, I almost cringe when I say trading depth because that provides a connotation that we have like pods [ph] and separate things and trader payouts and all the stuff that is traditionally present in the trade front. That's not Virtu never has been, right? And so the thesis -- one of the thesis of acquiring Knight and ITG was to effectively create this internalization mechanism within the firm where we could extract additional efficiencies, obviously, from an execution perspective. But more importantly, as [indiscernible] always says, to enable us to be the best bid in the offer in every asset class around the world, right? It just has heightened the efficiency. And so if you have a standalone firm, that's an options market maker, or it's an equities market maker does commodities or even within larger institutions where there's a constant push and pull of P&L and attribution and all the stuff that goes on in other firms, that denigrates from that mission. At Virtu because of the ethos and the culture that have been instilled in the firm when we first got started, everything is about one firm and everything is about like internalization. And as we have gotten broader and scaled, retail, nonretail, equities, commodities, equity linked products, options with the delta hedge, all of that just presents an opportunity for obviously reducing cost by not going outside the firm, for hedging or for risk management, right? You can internalize that. But it just provides additional synergies and opportunities within the firm. So again, very happy with the progress we have made in that regard. To use a very, very overused term, we've got a great central risk book being developed in the firm. Joe, you have some?

Yes. Hey, Rich, it's an interesting comment you make. The looking back over the past four quarters, $2.45 of EPS, you round number is $5.5 million of net trading income. We've had a lot of discussion about kind of our chart and the various levels of EPS it generates. I would say there's lots of different ways to look at this. If you want to look at it over the short-term, I think your comment is fair. I think that's a reasonable way to look at it in terms of that level of net trading income and earnings. I'd say if you want to look at it over a longer term, and we -- when we were at FIA 6 weeks ago, whatever it was, we noted what our pro forma performance has been since we went public, if you included ITG and KCG in the numbers, and it's around 6 on an average basis. And so I would hold to that on a longer term basis that we should be there, given growth and then given the outsized quarters which happen inevitably, and then the third layer, I would say, to consider both for the short-term and the long-term is the impact of the buybacks, right? So we've got -- since we started the buyback program. It's, again, round numbers, $1 billion of stock that we bought back and it's 14% of the company, net of issuances for our compensation. So I think as an emerging way to frame it, I think that's a -- that’s fair.

Got it. And I think you're referring to -- being $6 million NTI and being around in [indiscernible]?

$6 million net trading income per day over a very long period of time, yes.

Yes. So that's helpful. Very helpful. And then my quick -- I don't want this quick, but the follow-up would be thank you for all the laborious work you did on going through these comment letters and presenting it in the format you did. It's very helpful. I think investors just want to know if you could briefly summarize what's next? What's next in the process? And what can we expect?

Yes. Yes. Thanks, Rich. I will try to be professional in my remarks. Look, I mean, there was a title wave of comment letters that have come in. You would think and traditionally, and if they follow the law, there has to be a long and thoughtful process internally at the SEC where they review the comment letters. And the point that I made in my prepared remarks is I think and Gensler even said at a Bloomberg conference not that long ago, like he's dismissive of certain industry comments, which I thought was just a shameful comment, frankly, but he's dismissive of industry comments because we have an interest in it or on paraphrasing. But I think if you look at the totality of what has been received, and that's why we provided this summary. And you look at the participants, the notion that my friends at the New York Stock Exchange would put out a comment letter publicly with Citadel and with Schwab that essentially says, look, we would be the beneficiaries of this auction proposal because presumably, they would have an auction format that would satisfy the new rule, and we would be obligated along with the other wholesalers to route orders there. When the New York Stock Exchange stands up and says, we don't think this makes any sense, Gary, please withdraw this comment. And NASDAQ is the same thing and CBOE our friends and Tilly did the same thing. You have the three major exchange groups saying, we don't think that this makes any sense. When you have the Department of Justice on its own volition putting out a comment letter that says we think that, that these rules are not properly integrated together and don't make a great deal of sense, right? Another arm…

Our next question comes from Alex Blostein from Goldman Sachs. Your line is open.

Hey, guys. Good morning. I wanted to go back, Doug, to your point about internalization and the more sort of efficiencies you guys have been able to extract from the business. And we can sort of see it in the results like we had this quarter, right, where the public proxies were not as good relative to what you ended up putting up. But is there a better way to frame the opportunity to do more of that? Like if you kind of think about -- and I know it's a tough question to answer, but for us, looking from the outside, if we were to think of all else equal, how much more net trading per day would you be able to extrapolate from your ecosystem? What would that look like relative to what you're doing today?

Yes. Well, it's a great question, and I'm not going to try to avoid it. It's really hard to come up with an exact where does this -- obviously, you can look at like what we pay exchanges and ATSs and our broker commission expense line, right? And there's obviously a significant cost there. So there's the cost savings. I mean I will say we had our highest adjusted net trading day from internalization, if you will, since the KCG merger in 2017 this quarter, right? So we continue to grow, if you will, on a kind of opportunity basis. I think the important thing, and I mentioned it in response, I think, to Richard's first question is, what it does, though, is just make the firm more excellent and enable us to be more aggressive around pricing to clients and the prices, et cetera, that we can post on public markets and dark pools around the world. So it just makes you a better market maker. That's always been the thesis that was drilled into my head by Vinny in 2007 and '08 when we were starting this firm, right, which is how do you become the most efficient two-sided provider of liquidity. This is the end state, not to be a snarky guy, but like your firm I know there's a wall you can't go over, but Goldman had a great quarter in equities this quarter. And they are renowned for having a fabulous central risk book, right? So your institution gets it as well and does a great deal of internalization work and frankly, because we execute a lot with them and you have a lot more capital, they can probably take more risk and they do a great job. So like it's not like some thesis that we've just kind of discovered. But I do think it's very important because culturally, it fits exceptionally well in this firm. There's never that, I will say, non-virtuous conversation as to how do you attribute -- attribute P&L, whose bonus and bubble bottle, that kind of stuff that gets in the way of excellence. That doesn't happen in Virtu. So we're excited about the opportunity. I know I'm not quantifying it for you because it's really hard for me to do, Alex, in a way that kind of I feel comfortable with. But I will say it has really helped grow in particular, like our options business and even our ETF Block business. And I think it's a huge competitive advantage that we have not done a great job of highlighting and we will continue to try to do that.

Got it. All right. We will stay tuned for that. Hey, I wanted for my follow-up, ask you guys a question around fixed income. In your prepared remarks, I guess, you suggested that's becoming a greater focus. It sounds like you're benefiting from some of those initiatives, maybe on the execution services side. Can again, help us better frame fixed income revenues, credit trading, maybe in particular, maybe treasuries trading across Execution Services and Market Making, what does that comprise today? I don't think you do a whole lot on the market making side there, but is there an opportunity as the market evolves for you to do more on the market making side as well as your services?

Yes. Yes. Look, it's a great question, and it's a little bit -- I don't want to say it's the holy grail, but it's something that we are very, very in early stages of, right? So if you think options really started in earnest in 2019, we are in early innings. I mean, we are still -- we are not even in the [indiscernible], right? We are getting our fleet on in the dressing room with regard to fixed income. So I think there's a number of growth paths in fixed income. Obviously, treasuries, which we have been participating in for a long time, but we've made some improvements and some hires from outside the firm to help improve our DNA there. I think in corporate credit, same thing. I think the reason I like that, those businesses obviously, there's electronification of markets and our friends at like Tradeweb and MarketAxess and Bloomberg and Trumid and whatnot help effectively be distribution of those prices to end users, but it also fits in really nicely with our ETF Block business because it's a significant part of what we see in that business, frankly, is fixed income related both here and in Europe. Not surprisingly. So again, it is de minimis in our results, but I do think it's a significant opportunity. Look, we are never going to be the prop desk of a big bank. We don't have the footings to do that. It's not in our DNA to swing around huge blocks of corporate credit in the way that some of our competitor firms do. I mean those are great firms and they will continue to do really well there. But in terms of providing that acute liquidity, right, to end users go through the distribution mechanisms, the MarketAxess, Tradeweb, et cetera, and through our own client network, it's a significant opportunity.

Got you. All right. Thanks, guys.

Our next question comes from Ken Worthington from JPMorgan. Your line is open.

Hi. Good morning. Thanks for taking the questions. It seems like a big crisis always has the potential to be helpful to earnings. I think you mentioned customer repositioning in the prepared remarks. How big a deal was the [indiscernible] banking crisis to earnings this quarter? And for perspective, how did this crisis compared to others like Swiss franc that were helpful with profits in the past?

Yes, it's a great question. Actually, this one is different. It helps more on execution services side, Ken, than it did in market making. In other words, I think there was more institutional activity as a result of what was going on. People moving portfolio, getting out of XL [indiscernible] blah, blah, blah. And so that helps our Execution Services segment. On the Market Making side, and I've said this publicly before, when stocks go from Silicon Valley goes from X to 0, right, it's just serendipity where you were where you long or short. Frankly, I don't remember if we were it wasn't a material amount either way. And so there were some activity, obviously, in regional banks, and we did fine, but it wasn't like a big broad event that impacted the thousands and thousands of instruments like some large macro events, so in terms of market making, it wasn't material in the quarter. It really had a bigger impact on Execution Services. Joe, you want to add?

You mentioned the Swiss franc decoupling, Ken. I remember that. It started in FX and it reverberated around European equities, commodities into the U.S. This was more, I'd say, idiosyncratic and isolated.

Okay. It makes total -- yes.

No, no. There was no big windfall than market making. Like we made like an amazing amount. I mean frankly, I think we probably ended up breaking even, if you will, more or less in the regional banks, which from a risk management perspective was pretty darn good.

Okay, perfect. And then in options, how big a business is zero-day options for you and based on what you see, do you have any opinions on the durability or trading of this product? Or how much more it might grow for you over time?

Yes. Look, we are a participant in it, and I think any product that institutional investors, I mean, I know there's like a bid offer between like JPMorgan, Goldman asset [ph] like -- an institution as a retail I mean, frankly, I don't have a dog in that fight. We know that there's significant interest in it. It appears to be more institutional and retail based on what I've read, Ken. So I think, look, we are an active market maker in this space as more participants look to these daily options to hedge their market exposure, which I think that's what institutions are doing. I think it's probably more that than it is like a -- more than a speculatory kind of instrument. I think it's an important way to hedge a portfolio exposure. And so index market making, maybe we just got lucky here, is where we started, and we have the competitive advantage in that. So it plays nicely to our strengths. So as that sub segment, if you will, grows, we will continue to reap the benefits of that. So I think it's a positive P&L driver for our options in our Market Making business.

Okay. Okay, great. That's it. Thank you very much.

Thanks, Ken.

We now turn to Chris Allen from Citi. Your line is open.

Good morning, everyone. Congrats on the [indiscernible] windows.

Thank you. I should have mentioned that to Rich, but he's a big brown sand. I don't want to rub it in.

Yes. I know you missed your opportunity there. [Indiscernible] get a little bit more -- we get little bit more color on some of the areas you noted performing well in the quarter, FX, commodities and European equities. Energy got better in the last quarter, and it seems to continue to improve in the first quarter -- in the beginning of this year. But if we kind of look at FX European equities, kind of the underlying indicators from both are mixed at best. So I'm just kind of wondering where you're able to see strength there? Was there any competitive pullbacks? Any special situations? Just trying to get -- gather trajectory just in terms of some of the stuff that maybe we can't see as clear.

Yes. Yes. Thank you. It's a good question. And obviously, we look at opportunities. As I said in my prepared remarks, Chris, we measure opportunity in terms of volume and bid offer spreads and things like that in each of these segments that we participate in, and we did have an outperformance. I did note obviously that the metrics were mixed. So I think if you look at FX, it's been a segment that's been a little -- I won't say dormant, but less volatile than others. I think volumes were up 7% and FX volatility was up 16%. We made some internal changes and improvements and enhancements there that I think have borne fruit. Again, it's an asset class, if you will, that we don't talk about as much, obviously, we don't separately kind of disclose its performance anymore, but it is -- it continues to be an important growing area. I think we saw some nice activity in our commodity segment. Energy volumes were up 18% volume, but volatility was down 10%. So it was kind of mix there. But again, in that area were much more volume driven. And then the last thing I would say, which I mentioned before in response to an Alex's questions, I think internalization shouldn't be under underappreciated within this firm, and that is something that impacts all the deaths, but in particular, even like in Europe. What we do in our European block market making and our ETF Block market making, having the ability to hand off large positions and having other desks deal with them and having these cross desk opportunities and able to scale into new products and opportunities around the globe, which is kind of Virtu 101 has really helped continue to grow that business. Again, I think…

Got it. And then just on the organic growth initiatives, maybe if you could help us think about on a year-over-year perspective, where are you seeing growth? I would imagine you're seeing increased traction on the option side, but maybe you're seeing a more challenging environment in crypto. I'm just kind of trying to try and think about what's expanding and what's been challenged maybe from an environment. I know ATM has obviously been challenging right now. So just trying to think about what's working well right now, what's being cyclically pressured?

Yes. Great question. I think what's working well is options and Block ETFs. I think I've talked enough about those both had nice quarters. You're right. Obviously, crypto, a year ago, I guess, before the FDX debacle and the criminality there. I was talking about the opportunities and whatnot. We are still market making in crypto, we obviously pulled back some and some platforms, frankly, don't exist anymore, but we resumed limited market making, and we continue to be very, very excited about the initiative called EDX markets with Citadel, Schwab, Fidelity, Susquehanna -- no, not Susquehanna, excuse me, SEQUOIA and paradigm. And so we are excited about that. Fixed income, again, not a contributor but has a decent trajectory. And you're right, the ATM business, which again, is an incredible scalable fits really nicely into Virtu. I think we have four people working in it full time, right? So it's a great contributor to the firm and really leverages everything else we have that is something, again, that I look at over the long period of time, that's going to grow. But Block ETF and options were the driver in this quarter. Thanks, Doug.

Thank you.

Our next question comes from Dan Fannon from Jefferies. Your line is open.

Thanks. Good morning. I guess one more on the new initiatives. And you've been talking about the success and the growth of these for an extended period of time. And I guess when we think about a year from now or 2 years from now, what are the goals, or what are the kind of benchmarks we can hold against to talk about success? Because there's obviously growth and it's continuing, but the markets like options volumes are growing. So trying to gauge your success versus your internal targets or goals or benchmarks is there are things that we could point to or you could lay out to help us kind of gauge that success outside of just growing?

Boy, that's a great question. Again, I'm always loath to subdivide and provide like I know granularity lack a better word around our various businesses because that's a two-edged sword, right? Like if we start providing like granularity around our businesses got to bid one quarter when we don't satisfy the metrics, everyone runs around with their hair on fire, like our FX business was going out of business 5 years ago, I vaguely remember and it clearly has not. So, look, I think from our perspective, I said in the -- in my remarks, Dan, that it was $650,000 per day in the quarter, which was the highest in the first quarter of 2022. I mean that's a meaningful contribution to the firm. I look at that and say, okay, absent market forces, if you will, what will that look like in the next couple of years? Yes, we think that, that amount should grow, and it should be a seven figure amount. And I will say that here, and I've said that to our Board and whatnot, and that's the ambition. I mean, Joe, do you want to ...

No. We've -- as you said that our goal is to have $1 million of contribution in a medium term type of period 3-year-ish type of period. So again, it's going to depend on the market conditions. It's going to depend on the opportunity. If you look at that chart, on Page 5, obviously, 2020 is a little bit of an outlier, but you can discern a nice up and to the right type of growth there. So we expect that to continue.

Okay. No, that's helpful. Longer term targets, knowing the market is going to be changed is helpful. And then just one on expenses. It doesn't look like you guys updated your expense guidance based on the first quarter and how things are tracking. Does that all -- what you guys outlined last quarter still kind of hold for the year?

I think so. And you got to look at the major categories of expenses sort of individually compensation, our first quarter, if you go back historically and look, I think it's all the nominal amount of compensation, the not a dollar amount is typically the highest in any quarter in Q1 and then the percentage falls out of that. So I think comparing to the full year, our comp ratio first quarter was up looking 1.5-ish type of percent. So I would expect the same trend that you've seen in prior years in terms of the dollar amount that has accrued [ph]. Communication and data processing, I think, is tracking on an annualized basis, a few percentage points higher, 3%, 4% higher. Again, that's just -- we are in an inflationary environment, and that's we work hard at weeding out that. So I think we've actually done a good job there. And then the overhead category, same thing, a little bit of inflation in there. There's some strong dollar in '22 impacting that made it a little lower on a dollar constant basis. It's up a bit. Again, just the typical stuff that you would expect expenses running the firm are up a little bit. But I would expect we did update the guidance, and I would expect it to be pretty consistent with what we provided in the past.

Okay. Thank you.

Thank you, Dan.

Our next question comes from Michael Cyprys from Morgan Stanley. Your line is open.

Hi. Good morning. This is [indiscernible] standing in for Mike here. I just had a question about the environment. I know you guys like to get into month-by-month even close to quarter commentary necessarily. Just curious how the market from Q1 has evolved in April month-to-date. I think if I heard you correctly, commodities and FX are particularly strong and how you see things evolve there? And I guess, following on to that, as you think about the various ways the macro could evolve, are there any particular environment what you think Virtu would be -- would prefer or could perform better? Or do you think the firm is set up to do well regardless of how the macro evolves from here? Thank you.

Thanks. Did Alex Kramm put you up to that question? Because usually he ask that, and I'm joking. Look, I mean I -- we've tried very hard to like stick to the script, if you will, talking about the quarter and not getting into like what's happened in April. I mean I don't even today April 20. So I don't have any trading days I guess I should know, maybe 10 we've had in a 62-day quarter. So it's early. I wouldn't talk about it any app. Look, I think I've said this many times, I mean, there -- the best marketplace for us is one where there's a rising market. People have a lot of confidence, want to move portfolios and are making money because then they just trade more. We have always said that volumes are very, very important to this firm. We are a market making firm that collects the offer spread. And so the more bid offer spread, if you will, that comes through the systems and various markets, then more often than not, we are going to have better results and better returns. When there's volatility that tends to drive volume, sometimes it doesn't. Sometimes, there's a disconnect that I can't necessarily always put my finger on why. And there are certain types of volatility that are helpful. And as I've said early in response to a question from Ken there's other types of volatility. When stocks go from whatever Silicon Valley Bank was down effectively to 0, it's not like we have some Uber algorithm that can handle that. We are going to either make or lose money depending upon whether we were long or short at that instant in time. So we like more confidence and more certainty to markets where investors are moving portfolios and feel pretty good about what they're doing. So in 2023, you're going to see a mixed market, right? You've got intense uncertainty to put it mildly, both geopolitical over in Europe and now in Asia with saber rattling and obviously a live [indiscernible] war. You've got central banks all over the place that are trying to figure out which way it's up. You've got to try to manage inflation and expectations. You've got a debt ceiling fight in this country, right, which doesn't make investors happy. So those are variables, again, that are -- provide a backdrop that can be mixed in certain circumstances. But again, looking at the long haul, we are extremely well poised and have been well positioned, if you will, over the next couple 3, 4, 5 years to provide the liquidity that folks need as they manage portfolios and get through these various large macro events. I'm trying very hard to answer your question in a way that is sensible intelligent without talking about April because I said I wasn't going to do that.

I appreciate that. Doug, thank you very much for all the color. And I guess for the follow-up, this may sound a bit greedy here because I know you guys are working on a lot with all the organic growth initiatives going on. But as you look at the platform, is there -- are there any I guess is there any white space that you think there is where you could potentially start from scratch and build the business like the options business where Virtu doesn't currently have a presence. How do you think about that?

Yes. No, it's a great question. We think about it all the time, right, because the more widgets we can put through our system, presumably in a profitable amount, the more money we can make, and that's all we focus on. I would say it's not white, but it's pretty darn close to white, which is fixed income and credit, which we've talked about. I mean all of the elements, if you will, are there or are being constructed, right, in terms of being able to respond to RFQs and being in the marketplace and pricing products and whatnot, distribution is always an issue. That's why we partner with MarketAxess and Tradeweb, both of whom are terrific partners to us. So I look at that as a greenfield opportunity. I mean I'm aware, obviously, that there are firms that we compete with that have meaningful presences there. The Jane Street, the Flow Traders, the Citadels, et cetera, that are just terrific firms, but again, I would reemphasize it's still very early for us in options. So again, it's not quite white, but it's -- it's not black either, right? So it's probably wider than black in terms of opportunity to continue this very painful analogy that I started where you actually provoked on me. So I think like those are two areas that were very, very -- I prefer the innings and the analogy of the baseball player [indiscernible] my son is a great baseball player. So if we could stick with that in the future, I'd appreciate it. But that's where we stand. That's where we stand.

Thank you for all the color.

Thank you.

We now turn to Alex Kramm from UBS. Your line is open.

Yes. Hey, good morning, everyone. And yes, thanks, Doug, for the shout out. I was definitely going to ask the question. So now, I have nothing left, I do maybe only have a couple of follow-ups on things that we've already discussed. Maybe just to come back to the options business because I think somebody asked about the kind of organic trajectory. I think last quarter, you talked about the number of symbols you've rolled out and maybe some markets you're slowly expanding into. So maybe you can be a little bit more specific as we think about the next four quarters, perhaps of where you want to be in terms of symbols in options or markets you want to be in, again, to the earlier question of something to hold you accountable on? Like what are those underlying metrics that you're looking at to see that the business is actually getting bigger?

Okay. Yes. So I have mentioned this in earlier quarters. And I think one of our main emphasis is in 2020 is going to be in Asia. We have ramped up there and staffed up there. We moved to really high caliber people from New York are out there, have moved out there. So I do think there is significant opportunity there. Obviously, there are competitors there, but there's a very robust market, both in Japan and in India for index options, we are a participant there. And so yes, we have internal metrics as to where we want to be at the end of 2023 there. And they'll get included, obviously, in the large mix of noncustomer market making and then market making as we report out. But it's meaningful, and it's a significant growth opportunity and a challenge the desk and the folks to grow that business, and that's something that the Board is going to hold us accountable to. So we are excited about that. I think there's opportunities in cross-asset class options around energy and et cetera. Korea is another market, FX options. So these are all things, as I said before, using my sports analogy where we continue to be in the very early innings. I mean there are firms that are big broad firms that have been doing this for 30 years, the [indiscernible] the IMCs, the Citadel, Susquehanna, right? They're fabulously scaled, wonderfully executing terrific firms that do a lot of great work there. We are nowhere near their excellence in their size. And so that's the goal to be named in the same breadth, if you will, as those firms, and we have the technology, we have the distribution there's not a client or a counter party that we want to deal with on exchange, et cetera, that won't do business with us. We have the capital, we have the clearing. So now it's just a question of executing and for the last 15 years since [indiscernible] enough to invite me into the firm. That's what we've done. We are really good executing firm. So again, I don't measure success or excellence quarter-by-quarter. I know that's what we have to do as a public company. But I look at that business and say, in the next 2, 3 years, that business could double, could triple in size, and that's our goal.

Okay. But too early to give us updates on progress on symbols and things like that, right, since you mentioned them before?

Yes. Frankly, I don't even have a symbol count in here, so I'm not going to just -- I don't know …

May be helpful in the future.

Okay.

That would be -- maybe helpful in the future. And then -- and just secondly, and sorry to be a little bit of a history buff here, but you obviously mentioned commodities, FX and European equities and somebody asked about those three business before. Now if I go back to the pre-KCG days, I think 2015, those businesses peaked when we were able to track them more actively. I think FX and commodities were on 400,000 a day each, European equities was doing 200,000. So about 1 million between the 3 of them. So now it's been 7 years -- 7, 8 years in the markets have changed a lot. But when you look at those prior results in context, I mean, are these businesses meaningfully bigger? Like how would you compare them? I know a lot has changed, but clearly, you called them out this quarter.

Yes. No, look, it's a great question. And you should do your homework and you do your home market, and you're very thorough at it. So thank you for that. Look, I think a lot has changed since then. The FX market has gotten incredibly more competitive. And volumes and volatility as you track and as we track have dissipated significantly. The commodities market, again, I'm not trying to in gender sympathy here. The natural gas market effectively didn't really trade much for like 3 or 4 years and it used to be something that was a significant contributor back in 2015. So I'm not going to comment separately on what those results are because we've gotten away from that. I will say that they continue to be important contributors and vibrant parts of the firm where we have dedicated really, really terrific resources. And again, to bring it back, I think it is part of the story that we are a very diversified scale firm I think the narrative somehow that we were like a melting ice cube or all that kind of stuff is just -- is not valid. And I do think that the continued P&L opportunities from internalization even within those debts that I mentioned continue to be robust. And opportunities in desks [indiscernible] will ebb and flow within the firm. And that's one of the reasons, Alex, not to beat a dead horse that we've gotten away from the granularity of disclosures, not because we are ashamed by anything that's happened or the performance has been so horrible a lot. It's because we think the right investment thesis is to look at the totality of this firm and the service, if you will, that we provide to the marketplace around the world to look at the opportunities, the "white spaces that we have and say, okay, in the next 2 to 3 years, all things being equal, where can this firm be given the expense discipline on the capital management we have and the stock buyback program we have and project out and say, this is an attractive firm that gives us that, which has scale and allows us to pivot and reallocate resources where there's opportunities. You know the investment thesis and parenthetically investors are getting paid $0.96 per year to continue to like believe in that investment thesis and that story going forward.

Very helpful. Thanks for the color.

Thank you, sir.

This concludes our Q&A. I will now hand back to Douglas Cifu, CEO, for any closing remarks.

Elliot, thank you very much, and thank you to our investors and for research analysts for all the hard work and for the great questions, and we look forward to speaking with you in the summer. Thank you all.

Ladies and gentlemen, today's call has now concluded. We would like to thank you for your participation. You may now disconnect your lines.