Virtu Financial - Q2 2023

Transcript

Operator (participant)

Hello, all, and welcome to the Virtu Financial 2023 quarterly results conference call. My name is Harry, and I'll be your operator today. If you'd like to enter the queue for questions, you may do so by pressing star 1 on your telephone keypad. It's now my pleasure to hand you over to Andrew Smith, Head of Investor Relations for Virtu Financial, to begin. Andrew, please go ahead when you're ready.

Andrew Smith (Head of Investor Relations)

Thank you, Harry, and good morning, everyone. Thank you for joining us. Our second 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 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 beliefs 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 included 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, and 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 material, with an explanation of why we deem this information to be meaningful, as well as how management uses these measures. With all that, I'd like to turn the call over to Doug.

Douglas Cifu (CEO)

Thank you, Andrew. Good morning, everyone. Thank you for joining us this morning. In my remarks today, I will focus on Virtu's second quarter 2023 financial and business performance and strategic initiatives. Following my remarks, Joe and Cindy will provide additional details on our performance. Looking at our year-to-date and second quarter results, which are summarized on slide two of the supplemental material, we generated $4.5 million of adjusted trading net income per day in the quarter and normalized adjusted EPS of $0.37. Slide three highlights that our market making segment earned an average of $3.1 million per day of adjusted net trading income, outperforming the public market metrics for the quarter, and our execution services businesses delivered $1.4 million per day.

In the second quarter, our customer market making saw decreased opportunity as the overall bid-offer spread and retail participation levels declined relative to the prior quarter. Although these factors led to decreased opportunity for our customer market making business, we performed in line with our own internal performance projections. As we've said previously, market-making share alone is limited as a gauge of performance, but it's worth noting that our market share in the wholesale market-making business remains within historic ranges. Our non-customer market-making business, which provides liquidity across asset classes globally, performed well in the quarter, although its opportunity was also impacted by the muted volumes and volatility environment. Our organic growth initiatives, including our expansion into options market making, continue to perform well and make meaningful progress.

We remain excited and optimistic about our growing abilities to address the global opportunities that await, especially in options, ETF, block, and fixed income. On the execution services side, our adjusted net trading income averaged $1.4 million per day in the second quarter. Much like the last two quarters, institutional activity remained muted as our clients continued to look for more clarity from the macroeconomic environment. Most pronounced, Pan-European volumes were 16% lighter in the second quarter, with institutionally sized, large, and scale volumes down over 20%. Despite these challenging markets, VES performed in line with its opportunity quarter-over-quarter as well as year-to-year. Our multi-year focus on efficiency and new business development has yielded a scaled, multi-asset class, global business that is laser-focused on our clients.

As I mentioned in the past, we are particularly excited about the expansion to new asset classes. We're seeing increased uptake of our automation analytics, especially in fixed income markets, which continues to drive new opportunities for growth and enhances our current business. While the overall environment in the second quarter was softer, especially characterized by a very slow start in April, we were encouraged by improvement performance in the latter part of the quarter. In these very early days of the third quarter, we are seeing some modest enhanced opportunity, in particular in our customer market-making business. While we are generally pleased with how we performed against the addressable opportunities in the second quarter and how we continue to deploy these new businesses, we continue to focus on ways to improve in any environment and seek out new opportunities.

It is important to note that we continue to invest in recruiting talent in any market environment. While Virtu's headcount has remained relatively stable after years of up and downs due to integrations, the steady house headcount total masks the significant investments that we have made in people and talent in strategic areas of focus. Since January 2021, we have hired almost 300 full-time employees, including quants and developers in options, ETF block, fixed income, our asset money market business, and other growth areas. We have also invested in hiring the right team of client-facing folks to continue to grow our VES business. Most recently, we hired Keith Casuccio, a respected industry veteran, to lead client engagement and product efforts within VES. As always, we remain relentlessly focused on costs and realized a 44% adjusted EBITDA margin during the period.

Coming off a record 2023, our options business has performed well against the declining opportunity set in the quarter. We continue to expand across venues and geographies. However, in the U.S., market-wide customer index options volumes were down 11% in Q2, impacting results in the quarter. We've continued to build out our block ETF desk by improving our competitive edge and expanding our offering to cover more products in more regions, including fixed income, both in credit and rates. The operating scale we enjoy from our standardized global technology platform allows multi-tool players to immediately contribute to the growing business in any region or asset class, as we reallocate personnel to focus on the biggest opportunities. However, this quarter was slower in ETF block, as you may have seen from other announcements from our competitors recently.

I will now turn it over to Joe, who will provide additional details about the quarter. Joseph?

Joseph Molluso (Co-President and Co-COO)

Okay, we focus on cash Opex. We ended the first half of the year with cash operating expenses that were $322 million, about 3% ahead of where we ended the full year 2022 annualized. We continue to manage expenses aggressively, especially in a soft environment and inflationary times. Our cash comp ratio is at 25% for the first half of the year, which is at the upper end of a historical range. Consistent with Virtu's history, we will manage the discretionary compensation and headcount to drive profitability for our shareholders, while retaining and recruiting world-class talent, as Doug mentioned. Other expenses were up slightly in line with our expectations.

Communications and data processing expenses were essentially flat versus the prior year and up 2% year-over-year, owing to some investment in building out new businesses in the global inflationary environment. Other expenses on an annualized basis are up a bit, due to some favorable FX adjustments in the prior year, and some increased professional fees. In terms of guidance for 2023, we would expect our cash operating expenses to come in on an annualized basis equal to the first half of 2023. On capital and debt, you can see our trading capital remained relatively constant throughout the year on slide six of the supplemental material. We've maintained our public $0.96 annual dividend, which we have now paid steadily since we've been public for eight years.

You can see there that our payout has remained steady despite our variable results over the long term. This consistency demonstrates our commitment to returning capital to shareholders and our ability to generate robust results over the long term. In addition, we repurchased 2.3 million shares this quarter for approximately $42 million. Our period-end share count is now 167.9 million shares, and we have repurchased net of compensation-related new issuances, almost 15% of our company in the 2+ years since beginning our share repurchase program. Since the inception of our share repurchase program, we have repurchased a total of 38.5 million shares for a little over $1 billion.

Please refer to the outcomes at various performance levels on slide eight to see that our year-to-date share purchases of $118 million are ahead of the guidance on an annualized basis. With that, I will turn it over to Cindy Lee, to review the financial details before we turn over the call to questions.

Cindy Lee (Deputy CFO)

Thank you, Joe. Good morning, everyone. On slide three of our supplemental materials, we're provided a summary of our quarterly performance. For the second quarter of 2023, our adjusted net trading income, or NTI, which represents our trading gains, net of direct trading expenses, totaled $279 million or $4.5 million per day. Market making adjusted net trading income was $193 million, or $3.1 million per day. Execution services adjusted net trading income was $85 million, or $1.4 million per day. Our second quarter, 2023 normalized adjusted EPS was $0.37. Adjusted EBITDA was $122 million for the second quarter of 2023, and the adjusted EBITDA margin was 44%. On slide nine, we provided a summary of our operating expense results.

For the second quarter of 2023, we reported $173 million adjusted operating expenses. We continue to maintain an efficient cost structure and discipline expense management, which has helped us to control our operating expenses during the inflationary environment. Financing interest expense was $25 million for the second quarter. With the benefit of the interest rate swap contract that we entered in the prior year, our blended interest rate was around 5% for long-term debt in aggregate. Our capitalization remains as is. We remain committed to our $0.24 a quarter dividend. The combination of the dividend payout and the share repurchase program demonstrate our continued commitment to return capital to our shareholders. Now, I would like to turn the call over to the operator for the Q&A.

Operator (participant)

Thank you. If you would like to ask a question, please press star followed by 1 on your telephone keypad now. If you change your mind, please press star followed by 2, and when preparing to ask your question, please ensure that your phone is unmuted locally. For our first question, we will go to the line of Daniel Fannon of Jefferies. Daniel, your line is now open.

Daniel Fannon (Managing Director and Senior Research Analyst)

Thanks. Good morning. Doug, appreciate the commentary on the environment. I was hoping you could expand a bit. It seems like April was kind of the low, and then you saw improvement throughout, and it appears to be continuing a bit in July. Could you maybe just bifurcate or expand a bit upon, you know, kind of what the asset classes or areas, geographies that maybe really have seen both, you know, kind of the more improvement and also kind of where the biggest levels of change have been?

Douglas Cifu (CEO)

Yes. Good morning, thank you, Dan. You're under a lot of pressure because you've now replaced Rich Repetto as the lead-off questioner. We all miss Rich, and thank him for all of his efforts over the years. Anyhow, getting back to your question. Yeah, April, just anecdotally, in talking to competitors, particularly on the institutional side, was one of the slowest months that people have seen in over a decade. I think a lot of that had to do with macro issues. Had to do with, you know, some of the regional bank catastrophes, for lack of a better word, that were happening here in the United States. It was just very, very slow.

You know, the big banks saw that in April as well, and, certainly we saw it on the market-making side. The performance then progressed throughout the quarter and, you know, picked up through and including June, obviously, and, allowed us to report the quarter that we're reporting. As I noted in my comments, we have seen an improvement, you know, it's only 15, 16, or whatever, 17, 18 trading days in July, and that trend has continued. I would say, most particularly in U.S. equities, which is our largest asset class, and that's obviously, you know, drives a lot of our performance, certainly on the market-making side. I did highlight in my remarks that, you know, Europe, in particular, was very, very slow in the second quarter.

You know, there's a public company called Flow Traders, and they reported, and they obviously had a difficult second quarter, so you can kind of see what the metrics are in terms of Europe and whatnot. We've seen somewhat of an improvement of that in June and July as well. I would say really, U.S. equities, in particular, was very surprisingly slow in April, and we've seen an improvement.

Daniel Fannon (Managing Director and Senior Research Analyst)

Great. That's helpful. You mentioned fixed income, you know, in, I think in commentary around some of your data for the quarter. One of your domestic peers, you know, had an announcement this quarter about getting more active within corporate fixed income on the market-making side. Could you maybe talk about, you know, your presence in that market and how you're thinking about that opportunity going forward?

Douglas Cifu (CEO)

No, I mean, I think it was great news, to be candid. I mean, obviously, they're a competitor and a great firm. You're referring to Citadel Securities. I think it validates our thesis that, and it gives that, you know, we've been active as a market maker in credit. You know, we're going on, like, our second kind of full year, if you will, doing all the Virtu things in terms of onboarding counterparties, you know, developing trading expertise in mostly investment-grade debt, becoming a disclosed market maker on MarketAxess and partnering with MarketAxess, and Tradeweb, and Bloomberg, and all the other venues that allow us to have distribution.

The good news is that we've improved our win rates, we've improved our credibility, if you will, and we think that we can be a credible source of liquidity as a liquidity provider, either directly to buy-side counterparties or through distribution partners like MarketAxess, Tradeweb, et cetera. In addition, we have expanded our capability in rates, both on the run and off the run. We have over 50 firms that we are enabled for trading rates, again, using primarily Bloomberg and Tradeweb. We're agnostic as to the distribution mechanics. We know those are both great firms that give us scale and credibility. It's very early days. We're seeing maybe less than 5% of the volume, from 5%-10% of the clients on these platforms.

It's something that I'm personally engaged with because I think it's a marketplace where we can add value. There's a lot of room and I think a lot of opportunity, we've always done well competing in our part of the market and using our style. These are two marketplaces, if you will, for credit and rates, where we think that we can add value. You know, that announcement from Citadel just frankly validates the decisions that we made a couple of years ago to reallocate some of our resources, capital, and personnel into this area.

Daniel Fannon (Managing Director and Senior Research Analyst)

Thank you.

Douglas Cifu (CEO)

Thank you, Dan.

Operator (participant)

Thank you, and in the interest of time, if you could please limit yourself to one question and one related follow-up, if necessary. For our next question, we will go to the line of Ken Worthington from JPMorgan. Ken, your line is now open.

Ken Worthington (Senior Equity Research Analyst)

Hi, good morning, and thanks for taking the question. Would love an update in terms of where you are in the single stock option market-making rollout roadmap. Is the 605, 606 type of business still the end goal for you in options? Maybe how far along is Virtu in terms of being able to effectively participate in that single stock options business the way you do for equities for client business?

Douglas Cifu (CEO)

Good question. It is definitely the end goal. I would say not that we've got distracted from it. I think the opportunity, frankly, in index market making, both on the customer and non-customer side, has frankly dwarfed can that opportunity. I mean, you probably track all the metrics in terms of what the SPY and SPX volumes were relative to single options, and there has been a dramatic shift. I don't know if it was because of zero-day options or whatnot. I mean, that's for, you know, you can ask Cboe and some of the other smart people as to why that's happened.

I mean, I guess our decision to compete first in the index family has been validated because we've seen an enormous shift of interest on the institutional and frankly, on the retail side, because you can see what's a customer option and what's not a customer mark option in a lot of these venues to the index family. It is certainly in the roadmap, but it has descended in importance because the addressable market is so huge in the index family here in the United States. I would also point out that we do have an up and running index business in Asia, primarily in the Indian and Japanese markets.

I don't want to put a, a date on it, because every time I suggest we're gonna be we'll be operational by so and such date, we keep pushing it out because there's such an opportunity in the index family that we continue to. frankly, you know, with MEMX and different options, venues continue to come on. There's a lot more opportunity to improve our index market making capabilities in the United States.

Ken Worthington (Senior Equity Research Analyst)

Great. Thank you.

Douglas Cifu (CEO)

Thanks, Ken.

Operator (participant)

Our next question today is from the line of Chris Allen of Citi. Chris, your line is now open if you'd like to proceed.

Chris Allen (Managing Director and Senior Equity Research Analyst)

Morning, everyone. I wanted to follow up on Dan's questions on the rates. Historically, you've talked about market structure impediments to getting bigger in the rates business. What's the outlook there? There's a lot of talk around moving to centralized clearing, improvement on settlement times. Then in terms of your penetration level right now, less than 5% of volume, is this just because you're kind of just getting up to speed right now, just starting to slowly build the business? What's the longer-term opportunities that you see there?

Douglas Cifu (CEO)

Yeah. I'm gonna do something that you will never hear me say on an earnings call and compliment the chair of the SEC. In terms of, you know, centralized clearing of Treasury products and, you know, real-time reporting or relatively real-time reporting or TRACE for Treasuries. All of those things are positives, I think, for the marketplace. Certainly, those are initiatives that this SEC has undertaken, and we have been publicly and privately very supportive of those because I think it enhances competition. I think what has changed in the marketplace is a little bit of that. I mean, the natural efficiency of the marketplace, I mean, 10 years ago, even five years ago, these were marketplaces that were largely dominated by the big dealers. I think the buy side has gotten smarter in terms of seeking alternative liquidity providers.

There are dozens of those, and we now have credibility with the distributors of the products, i.e., the Tradewebs and the Bloombergs of the world, who are great business partners of ours. You know, MarketAxess, obviously, but LiquidityEdge, we work with them as well. Using those partners to enable our distribution and to give us credibility. I mean, it's always a fight, Chris, to get into the wheel, if you will, on the buy side. You know, they can't enable 30 liquidity providers. It's no different than in equities and what we do in our business in ALERT, et cetera.

It's understanding who the key counterparties are, getting credibility with the distribution channels, the Tradewebs, the Bloombergs, the MarketAxesses of the world, and then providing, you know, good real-time pricing. I mean, just yesterday, we were engaged on this with some senior folks at Tradeweb to understand, you know, who the main clients are, how we can get better, what they're looking for in terms of mark-outs and response times. It's the blocking and tackling of market making, which we're very good at, but it's a very competitive marketplace with dozens of competitors and hundreds of counterparties. Sifting through all that to build out the right offering and provide value to the market is what we're doing.

You know, so we're in the top 20, you know, on Tradeweb right now, which is great. Obviously, we would like to be in the top 10 and ultimately in the top five, whether that's realistic or not, given the competitive nature of that market. I think our scale, you know, gives us an advantage, and again, the fact that we're multi-asset class. To the extent these rates products manifest themselves, you know, either as a future or an ETF, obviously, those are marketplaces that we have access to as well. We always pride ourselves in being the most efficient provider of the two-sided quote. That's a nice way of saying we manage our expenses, and so we can tighten up our prices in order to be competitive.

Again, this is just, you know, kind of Virtu 1 on 1, how to build a business. This is clearly different than some of the other, you know, than U.S. equities, but it's in a, in a marketplace that we think is eminently addressable by our product offering.

Chris Allen (Managing Director and Senior Equity Research Analyst)

Cool. Thanks a lot, guys.

Douglas Cifu (CEO)

Thank you.

Operator (participant)

Thank you, and as a reminder, to ask any further questions, please press star followed by 1 on your telephone keypad. Our next question is from the line of Michael Cyprys of Morgan Stanley. Michael, your line is open.

Michael Cyprys (Managing Director)

Great. Thank you. Good morning. I want to circle back to your commentary on the index options volumes, where you guys have been quite active. It sounds like you're excited about the opportunity set there, but I was hoping you might be able to elaborate on what you're seeing across the marketplace that's driving the strength in index options, how sustainable do you think this activity is, particularly if we go into different types of market environments over the next year or two? If you could maybe provide any sort of color on the what sort of customers you're trading with on the other side. We hear a lot of it's retail, but how would you characterize that retail activity, and to what extent do you see or think institutions could start to come in?

Douglas Cifu (CEO)

Yeah, that's a very good question, Michael. Look, I mean, I give credit, I guess, to the, you know, the folks at the options exchanges that were deriving these products. Like, you know, the daily expiration product, I think, you know, our sense is that it trades more because they're, I'll use the word better and cheaper hedging instruments than other instruments that have been out there. This drives volumes and drives, you know, interest from both professional traders and institutional traders. We don't expect that, you know, I mean, obviously, there will be ebbs and flows with macro and market volumes, but we don't expect that this shift will change any time in the, in the near future.

You know, hats off to, you know, the folks at Cboe and other institutions that have done a great job, you know, creating a hedgeable instrument that provides efficiency and scale. I mean, that's how markets work, and that's what we're all about, and we're excited about that. We feel validated, and I give a lot of credit to the folks that run our options business because they beat me over the head and said, "No, this is where the market's gonna be going," two years ago, and they were right. The fact that we are up and running and very, very competitive in those products has been very, very beneficial to our business.

You know, in terms of like, what, you know, quote-unquote, customer flow this is, whether it's, you know, mom-and-pop retail, I would imagine it's not, because obviously there's suitability concerns. I think it's probably, you know, smaller trading firms and, you know, folks like that are going through options aggregators, that's really where our focus has been in terms of, you know, customer engagement. It's not necessarily with the big retail firms, but more the options aggregator firms, you know, like a DASH and firms like that have that act as a front end and an aggregator for, you know, professional or smaller trading firm, options flow. I think that's where we have focused and will continue to focus our energies.

You know, it's been about 40% of the flow, you know, come from customer accounts in the SPX index complex, and that's meaningful. You know, it's tagged either as customer or non-customer, so you can kind of allocate your interest based on that. We know that's significant. It's a very attractive, addressable market, and that's where we focus our energies.

Michael Cyprys (Managing Director)

Great. Thank you.

Douglas Cifu (CEO)

Thank you.

Operator (participant)

Our next question today is from the line of Patrick Moley of Piper Sandler. Patrick, your line is now open.

Patrick Moley (Director and Senior Research Analyst)

Yeah, good morning. Thanks for taking my call. Doug, I had a question on internalization opportunities. Was wondering if you could maybe compare and contrast the opportunities you saw in the second quarter relative to the first quarter, given, you know, the lower volatility environment we're in, maybe what that means for those opportunities going forward, and maybe what that means for the normalized earnings power of the firm overall. Thanks.

Douglas Cifu (CEO)

Yeah, good question. Welcome to the call. As Rich's successor, you got some, very, very large shoes to fill, so, good luck to you, and we look forward to working with you. To answer your question, look, and we don't disclose what our internalization rates are by our various groups, but it is, and I have mentioned it historically on calls, and it continues to be a key competitive advantage to this firm. You know, our rates were in line with what we thought opportunities were during the quarter, so we were very, very pleased with what we're doing.

I mean, the examples I've given before about options hedging and the ETF desk, you know, laying off risk on our single stock desk and, you know, et cetera, et cetera, down the line, you know, continues a pace. I think that is part and parcel of the culture and equally important, the technological setup of Virtu, in the sense that like, you know, a widget is a widget, is a widget, and we don't really have desks per se, so we're very capable of doing that. One thing I will point out is that, like, on our, for our at-the-money offering business, Virtu Capital Markets, we have a. It's at least double what we think other competitors can do in terms of crossing with internal Virtu flow. That's a key selling point.

We obviously don't have research, you know, capital and calendar. What we offer in that business is real alacrity around execution capabilities, both on a technological side, but also being able to internalize an awful lot of the flow. Based on our understanding of what other desks do or other institutions do, we believe that our internalization rate, for example, on our ATM business, is at least 2x what our competitors are offering.

... has resonated with clients and hopefully, will resonate with more issuers in the future. We continue to be very excited about that business in particular, Patrick.

Patrick Moley (Director and Senior Research Analyst)

All right. Thanks a lot.

Operator (participant)

Our next question today is from the line of Alex Blostein of Goldman Sachs.

Douglas Cifu (CEO)

Go ahead, great.

Operator (participant)

Alex, your line is now open.

Alex Blostein (Managing Director and Senior Equity Analyst)

Hey, good morning, guys. Thanks for the question. I was hoping we could spend a minute on balance sheet strategy from sort of two angles. I guess, on the one hand, hear you on opportunities in fixed income. To what extent do you think that might, you know, impact how much capital you need to run the business with, and what that means for sort of capital return framework down the road? Secondly, if we look at the balance sheet leverage, that's obviously been picking up, with EBITDA coming down. just maybe a reminder, what level of debt-to-EBITDA do you feel comfortable running with? Again, with higher leverage today, does that impact your capital return framework at all?

Joseph Molluso (Co-President and Co-COO)

No. Hey, Alex, its Joe , I'll take that. There's, you know, no change in that view. I mean, naturally, you know, with, you know, with a softer environment and reduced profitability, our returns are going to look, you know, lower, right, on a trailing basis. In terms of the amount of capital we need to run the firm, in terms of, you know, prudent buffers and meeting all our regulatory obligations, there's no change. You know, the fixed income business, is kind of, you know, planned for, right, within, you know, the amount of capital that we use today.

Unsurprisingly, you know, in a softer environment, you know, we deploy less capital than we do in a, in a more expansive environment, right? So, you know, from a, you know, the slide six, when you look at those, you know, trailing invested capital numbers and our EBITDA and our return, I would say, one, it includes planning for fixed income, which is, you know, a little more capital intensive. You know, we use obviously, we use prime brokers. We don't self-clear there, but we are, you know, appropriately kind of, you know, planned for in the numbers that we deploy. That's kind of, that's point one. Point two, in terms of the overall leverage, look, the...

You know, we were very fortunate, I think, both from a timing standpoint, and from a kind of a management of the leverage in terms of swaps and, you know, muting the impact of the higher rates. We're very happy with the overall level of debt. It allows us to buy back shares at the, you know, various points. I've updated the slide in here this quarter. It allows us to, you know, have the flexibility to keep our dividend. You know, we refinanced in early 2022. In early 2022, you know, we got rid of most of the more punitive kind of required cash flow sweeps and amortizations.

you know, we don't really look at it as whether, you know, it's 2.5 times, it's 3 times. It's a volatile business. you know, we're focused more on the notional level of debt, and we're very comfortable where it is today.

Alex Blostein (Managing Director and Senior Equity Analyst)

Okie dokes. Thank you.

Joseph Molluso (Co-President and Co-COO)

Thanks.

Patrick Moley (Director and Senior Research Analyst)

Thank you.

Operator (participant)

Thank you. We have no further questions in the queue today, this will conclude the Virtu Financial 2023 second quarter results conference call. Thank you all for joining. You may now disconnect your lines, please have a lovely rest of your day.