Optiver Interview Questions + Guide in 2024

Optiver, renowned in the world of high-frequency trading and market making, stands as a prominent player in the financial sector.

Known for its innovative approach to trading, the company has established a solid reputation for blending sophisticated technology with intricate financial strategies.

If you’re currently aiming to land a job at Optiver, then this guide is just for you.

We’ve compiled the most likely questions that are going to be asked, and by the end of this guide, you’ll have everything you need to ace the interview at Optiver.

Before anything else, let’s first talk about why you should apply for Optiver:

401K Plan

Optiver’s 401k plan is known for its generous matching policy. The company matches 100% of contributions up to a certain dollar amount and then provides a 50% match for additional contributions until the IRS maximum limit is reached. Additionally, employees are immediately vested, allowing them to fully benefit from the company’s contributions right away.

Vacation & Paid Time Off

Optiver has a great vacation and paid time off policy. They offer 25 personal days and 10 sick days, giving employees plenty of time to relax. There is a limit on rolling over vacation days, but the overall policy is flexible. Optiver also gives extra days off when markets are closed and provides unlimited coffee and lunch.

At Optiver, their salary structure is designed to reward expertise and attract talent in the tech and trading markets.

Software engineers receive an attractive average base salary of $120,719, while other roles, such as data scientists and data analysts also receive competitive salaries, recognizing their specialized skills and critical roles.

For more details on the salaries for these positions, you can view the information on our salary page.

Before we go through Optiver’s list of interview questions, let’s first cover what the company’s interview process typically looks like.

1. Initial Application

Start by submitting your application on Optiver’s website, including your CV and cover letter. It’s important to tailor your CV to show how your skills and experiences align with the role you’re applying for.

2. Assessments

Depending on the role, you’ll face various assessments. These could include quantitative, cognitive, or technical challenges. For example, a technology role might involve a coding test in languages like C++, C#, or Java, while trading roles could have numerical tests.

3. Initial Interviews

Successful candidates will have initial interviews to assess skills, cultural fit, and working style. This often includes a conversation with HR to get to know you beyond your resume.

4. Technical Screening

For technical roles, this involves a virtual call with Optiver’s engineers, traders, researchers, or risk analysts. The nature of this call varies based on the specific role.

5. Final Interviews and Discussions

This stage includes a series of behavioral and technical interviews. Technology positions involve two days of virtual interviews focusing on system design and technical skills. Trading positions include individual interviews, a group market-making simulator, and informal chats.

1. What motivated you to apply to Optiver, and how do you see yourself fitting into our company culture and values?

Understanding why candidates choose Optiver is important as it demonstrates their understanding of the company’s unique position in financial markets and dedication to technological innovation.

How to Answer

Emphasize your passion for the financial sector, your interest in technology-driven trading, and how your skills align with Optiver’s mission.

Example

“My interest in algorithmic trading and my background in finance makes me excited about Optiver’s role in market making. I’m keen to contribute to a company that values technology and innovation in finance.”

2. How do you prioritize tasks in a fast-paced work environment?

Optiver values candidates who demonstrate strong time management skills, which are essential for success in their fast-paced environment.

How to Answer

Explain your method for managing and prioritizing tasks, especially when under tight deadlines.

Example

“I use a combination of task urgency and impact to prioritize my work. For instance, I focus on tasks that are critical to market movements early in the day and allocate time for deep analysis when the market is less active.”

3. Describe a scenario where you faced disagreement with colleagues at work and your approach to resolving it.

This question evaluates your ability to handle conflicts in Optiver’s collaborative and fast-paced work environment.

How to Answer

Use a specific example that shows your skills in communication, problem-solving, and maintaining professionalism.

Example

“In my previous role, a disagreement arose over a trading strategy. I organized a discussion to understand differing perspectives and led the team to a consensus that improved our approach.”

4. Tell us about a time when you worked on a challenging project with a diverse team.

Optiver appreciates individuals who can effectively collaborate with a diverse set of colleagues, recognizing the strength that diversity brings to their team.

How to Answer

Describe a project where the diversity of the team contributed to its success. Focus on how you collaborated and what you learned.

Example

“On a cross-functional project, I worked with individuals from different departments and countries. We leveraged our diverse perspectives to innovate a solution that significantly improved our trading algorithm.”

5. What strengths and weaknesses would your previous manager identify in you?

Optiver values analytical and risk management skills, and is looking for individuals whose strengths align with the specific needs of a technology-focused trading environment.

How to Answer

Be honest and self-aware. Highlight strengths relevant to the job and discuss weaknesses you’re actively working to improve.

Example

“My strengths lie in quantitative analysis and risk management, essential for trading. I am currently enhancing my programming skills to better contribute to tech-driven solutions.”

6. Describe a situation where you had to make a quick decision under pressure.

The company’s trading floor values fast decision-making that is both swift and calculated, emphasizing the importance of speed without compromising accuracy.

How to Answer

Share a specific instance where you successfully navigated a high-pressure situation. Highlight your thought process and the outcome.

Example

“In a previous role, I faced a sudden market shift that affected our positions. I quickly analyzed the situation, consulted with key team members, and made a decision that minimized losses and capitalized on new opportunities.”

7. Discuss a time when you went above and beyond in a project.

Optiver thrives on innovation and excellence in a competitive market. This question assesses your ability to deliver exceptional results, crucial in high-stakes trading scenarios.

How to Answer

Describe a specific instance where you went above and beyond. Highlight your dedication, creativity, or problem-solving skills.

Example

“In a previous project, I identified a process inefficiency. By initiating a new strategy, not only did we meet our project deadline two weeks early, but we also increased productivity by 15%.”

8. Can you discuss a time when you analyzed complex data sets to make a trading decision?

The company is looking for individuals who have strong skills in analyzing complex data sets in order to make strategic decisions, as data analysis plays a central role in their trading strategies.

How to Answer

Highlight your analytical skills with an example that shows your ability to extract insights from complex data sets and apply them to real-world trading scenarios.

Example

“In my previous position, I was tasked with analyzing market trend data to identify potential investment opportunities. By conducting a thorough analysis of historical and real-time data, I was able to identify a promising emerging market and recommend a successful investment strategy.”

9. How do you handle conflicts at work, especially with difficult colleagues or stakeholders?

As quick and effective decision-making is the cornerstone of Optiver’s operations, the ability to resolve conflicts efficiently is crucial, reflecting the high-stakes nature of the trading world.

How to Answer

Show your ability to handle conflicts constructively, focusing on professionalism and finding solutions.

Example

“I believe in addressing conflicts through open communication. For instance, I once resolved a misunderstanding with a colleague by actively listening to their concerns, leading to a mutually beneficial solution.”

10. How do you stay resilient and focused in a fast-paced trading environment like Optiver’s?

The trading environment at Optiver is fast-paced and demanding. This aims to understand your ability to maintain high performance under pressure.

How to Answer

Discuss your strategies for managing stress and maintaining focus in a dynamic environment. Mention any specific practices or mindsets that help you stay resilient.

Example

“In high-pressure situations, I maintain focus by prioritizing tasks and taking structured breaks to avoid burnout. I also practice mindfulness to stay centered, which helps me make clear-headed decisions quickly.”

11. How would you maximize profit from a given list of stock prices?**

This question is designed to assess your programming skills, particularly in Python, and your understanding of market dynamics, both of which are essential at Optiver for developing strategies that capitalize on market movements.

How to Answer

Focus on your approach to analyzing the given data using Python, specifically highlighting your use of recursion or other algorithms to find the best buying and selling points for maximum profit.

Example

“I would write a function that iterates through the list of stock prices, keeping track of the minimum buy price and the maximum profit at each step. By updating these values as I traverse the list, I can determine the optimal buying and selling points.”

12. How would you optimize a high-frequency trading algorithm for minimal latency?

For a firm like Optiver, where high-frequency trading hinges on milliseconds, it’s vital to understand the technical nuances of trading algorithms and the critical role of speed in trading.

How to Answer

Discuss the key factors that contribute to latency in trading algorithms and strategies to minimize it, such as efficient code, hardware acceleration, and network optimizations.

Example

“To optimize for minimal latency, I’d focus on efficient algorithm design, prioritizing speed in code execution. I’d also consider hardware solutions like FPGA or GPU acceleration and optimize network paths for faster data transmission.”

13. How do you approach model building with skewed data distributions?

At Optiver, having a strong aptitude for statistical modeling and analytical skills is highly valued. They are interested in your approach to managing skewed data distributions, which is a common challenge in financial markets.

How to Answer

Discuss methods like data transformation, normalization, or using specific statistical models that handle skewness effectively.

Example

“For right-skewed data, I might use a log transformation to normalize the distribution. Conversely, for left-skewed data, applying a square root transformation can be effective. It’s crucial to reassess the model’s performance post-transformation.”

14. Describe your approach to detecting and preventing overfitting in quantitative trading models.

Overfitting is a common pitfall in quantitative trading at firms like Optiver. This question assesses your ability to create robust models that perform well on unseen data.

How to Answer

Explain methods for preventing overfitting, such as cross-validation, regularization, or using simpler models when appropriate.

Example

“I use cross-validation techniques to test the model’s performance on unseen data. Regularization methods like L1 or L2 can also prevent overfitting by penalizing overly complex models.”

15. Can you determine the fairness of a coin based on a series of flips?

Proficiency in probability theories is necessary for success in trading firms such as Optiver, as they value your ability in statistical inference and its practical applications.

How to Answer

Explain how you’d use probability theory, perhaps mentioning the binomial distribution, to assess whether the coin-flip outcomes significantly deviate from what’s expected in a fair scenario.

Example

“With 10 flips, I’d expect an approximately equal number of heads and tails for a fair coin. I’d calculate the probability of getting the observed distribution under the assumption of fairness, using the binomial distribution, to see if the result falls within an acceptable range of variance.”

16. How would you implement a strategy to exploit arbitrage opportunities in a multi-asset trading environment?

At trading firms like Optiver, exploring arbitrage is an important strategy where they aim to identify and develop strategies to capitalize on arbitrage opportunities.

How to Answer

Discuss the identification of arbitrage opportunities across different assets and the algorithmic approach to exploit these opportunities efficiently.

Example

“I’d monitor price discrepancies across multiple exchanges and assets. The strategy would involve creating an algorithm that can quickly execute trades when it identifies a profitable arbitrage opportunity.”

17. What challenges might arise in sentiment analysis of the WallStreetBets subreddit?**

This question tests your understanding of machine learning in the context of financial market sentiment analysis, a relevant task at Optiver.

How to Answer

Discuss potential issues like sarcasm, ambiguous language, or rapidly changing topics, and how you would address these in your model design.

Example

“Challenges include interpreting sarcasm and rapidly changing topics. I’d use an NLP model trained on a dataset representative of the subreddit’s language style and regularly update it to adapt to new terms and sentiments.”

18. Explain how you would use Monte Carlo simulations in risk assessment for derivative trading.

In the context of derivative trading at Optiver, risk assessment is key. They’re looking at how you apply Monte Carlo simulations to model and understand risk.

How to Answer

Describe how Monte Carlo simulations can be used to model various market scenarios and assess the risk of derivative positions.

Example

“Monte Carlo simulations allow us to model a range of market conditions and their impact on derivative pricing. By simulating thousands of scenarios, we can assess the risk profile of our positions under different market conditions.”

19. How would you quantify uncertainty in stock price forecasting models?

At Optiver, the quantification of risk and uncertainty in models is important for informed decision-making. This question will assess your ability to evaluate and communicate uncertainty in predictive models.

How to Answer

Discuss techniques like confidence intervals, Monte Carlo simulations, or comparing predicted versus actual values over time.

Example

“I’d use a combination of historical backtesting and statistical methods like Monte Carlo simulations to quantify uncertainty. Comparing the model’s predictions with actual market outcomes over various intervals would provide insights into its accuracy and reliability.”

20. How do you approach the calibration of a volatility surface for options trading?

Calibrating a volatility surface is vital for accurate options pricing at trading firms like Optiver. They are interested in understanding your knowledge of volatility surfaces and your approach to their calibration.

How to Answer

Discuss the process of calibrating a volatility surface, including the data inputs required and any mathematical models or techniques used.

Example

“I approach volatility surface calibration by first collecting market data on option prices. Then, I use optimization techniques to fit a model, such as a local volatility model or a stochastic volatility model, to this market data, ensuring that the surface accurately reflects current market conditions.”

21. How do you diagnose and fix an algorithm that is underpricing products on an e-commerce site?

Interviewers at Optiver want to know your proficiency in identifying and correcting algorithmic errors, a critical skill for upholding competitive pricing strategies in trading.

How to Answer

Discuss a systematic approach to diagnose the issue, such as analyzing the data inputs, checking the algorithm’s logic, and testing for edge cases. Emphasize the importance of accurate data and robust algorithm design.

Example

“First, I’d review the data feeding into the algorithm, ensuring accuracy and completeness. Next, I’d scrutinize the algorithm’s logic, particularly how it responds to changes in demand and supply. Testing in a controlled environment would help identify specific underpricing scenarios.”

22. How would you approach the creation of a predictive model for intraday stock price movements?

The interviewer wants to understand your expertise in developing models for predicting short-term stock prices, a central element of Optiver’s trading strategies.

How to Answer

Discuss the factors influencing intraday stock movements and the statistical or machine learning methods you would employ to predict these movements.

Example

“I would analyze historical intraday price data, incorporating factors like volume, volatility, and market news. Using machine learning techniques like time-series forecasting or recurrent neural networks, I would create a model to predict price trends throughout the trading day.”

23. How would you calculate the expected cost and set aside money for buying a scalped ticket, given the probabilities and prices?

This question evaluates your aptitude for utilizing probability and decision-making in situations of uncertainty, abilities that are pertinent to Optiver’s trading environment where comparable calculations could be employed for risk evaluation and pricing.

How to Answer

Use probability principles to calculate the expected cost. Discuss how you would approach the problem logically, applying statistical reasoning.

Example

“I’d calculate the expected cost by multiplying each ticket price by its probability and summing these values. To determine the amount to set aside, I’d consider the maximum possible cost while also taking into account the likelihood of each scenario.”

24. Describe a method to efficiently backtest a new trading strategy.

Backtesting is crucial at Optiver for evaluating the efficacy of trading strategies. They aim to assess your ability to implement and evaluate trading strategies systematically.

How to Answer

Outline a structured approach to backtesting, including data selection, strategy implementation, and performance evaluation.

Example

“For backtesting, I’d first ensure data quality and relevance. I’d then implement the strategy in a simulated environment, tracking performance metrics like return, risk, and drawdown. Post-analysis, I’d adjust the strategy based on performance insights.”

25. Which credit card user would owe more in a year, considering different APRs and monthly spending habits?

This question assesses your knowledge of interest rates and financial calculations, which is important for trading roles at Optiver.

How to Answer

Detail your method for calculating the interest for each user, taking into account their APR and repayment habits.

Example

“I’d calculate the monthly interest for each user based on their APR and unpaid balance. Summing these monthly interests over a year would reveal which user owes more. It involves understanding compounding interest and payment behaviors.”

26. How would you analyze and interpret market liquidity data to inform trading decisions?

Market liquidity analysis is vital for a firm like Optiver, which specializes in market making.

How to Answer

Discuss the importance of liquidity data and how you would use this data to make informed trading decisions.

Example

“I’d analyze bid-ask spreads, trading volume, and order book depth to gauge market liquidity. This information is crucial for deciding entry and exit points in trading, ensuring we can execute large orders without significantly impacting the market price.”

27. How do you analyze volatile and noisy time-series data to ensure accuracy in your models?

Given Optiver’s focus on financial markets, handling noisy and volatile time-series data is a daily challenge. This question tests your ability to deal with real-world data issues in financial modeling.

How to Answer

Discuss techniques for cleaning and analyzing noisy data, such as filtering methods, outlier detection, and ensuring data integrity.

Example

“I’d use filtering techniques to smooth out noise and apply outlier detection methods to identify and handle anomalies. Validating the data against reliable sources is crucial to ensure its accuracy before using it in any model.”

28. What approach would you take to model and hedge against foreign exchange risk in a portfolio?

Hedging against foreign exchange risk is a critical concern for global trading firms like Optiver.

How to Answer

Explain the methods you would use to identify foreign exchange risks in a portfolio and strategies to mitigate these risks.

Example

“I would use a combination of statistical analysis and scenario simulation to identify potential FX risks. To hedge these risks, I would employ strategies such as currency forwards or options, depending on the risk profile and time horizon of the portfolio.”

29. How would you address a significant data quality issue in a logistic regression model, where a key variable’s values are incorrectly altered?

This question is asked during an Optiver interview to evaluate your problem-solving skills in data science and your ability to handle unexpected data quality issues. In a trading context, where decisions are based on data, the reliability and accuracy of data are extremely important.

How to Answer

Discuss the steps you would take to identify the issue, evaluate its impact on the model’s performance, and outline strategies to correct the data and adjust the model accordingly. Emphasize the importance of data validation and continuous monitoring of model performance.

Example

“Upon discovering the data quality issue, I would first quantify its impact on the model’s predictions. If the altered data significantly skews results, I’d explore solutions like data cleansing to correct the values or retraining the model with accurate data. Continuous validation of data inputs is crucial, and I would implement checks to prevent similar issues in the future. In this case, rectifying the data and possibly adjusting the model’s weighting on that variable would be key steps to ensure the model’s validity and reliability.”

30. Explain how you would use option Greeks to optimize an options portfolio.

Understanding and utilizing option Greeks is essential in options trading, a key area for Optiver.

How to Answer

Describe what option Greeks are and how you would apply them to manage and optimize an options portfolio.

Example

“Option Greeks provide insights into the sensitivity of option prices to various factors. I would use Delta for direction risk management, Gamma for curvature risk, Theta for time decay, Vega for volatility exposure, and Rho for interest rate risk. Balancing these Greeks helps in constructing a portfolio aligned with our risk-return objectives.”

Let’s go through some tips that can help you ace your interview at Optiver.

Understand Optiver and The Role

Familiarize yourself with Optiver’s business, culture, and the specific team you’re applying to. Review their website and understand their main tasks and objectives. Knowing the company’s ethos, especially their emphasis on improving global markets, can give you an edge.

Simplify Your Problem-Solving Approach

Optiver values simplicity in solutions. Practice breaking down complex problems into smaller, manageable steps. This approach is especially useful in technical assessments and interviews.

We offer Challenges where you can test yourself against real-world problems. Breaking down these complex problems into manageable steps can mirror the simplicity that Optiver values.

Engage in Genuine Dialogue

During interviews, speak your mind clearly and ask questions. Optiver appreciates genuine dialogues and collaborative problem-solving. This shows your willingness to engage and contributes to mutual understanding.

Try our Coaching feature. Here, you can discuss interview strategies and get tips from peers and professionals in similar fields.

Self-Reflection

Reflect on your interests, accomplishments, and career goals. Understanding your strengths and areas for growth can help you present yourself authentically and align your aspirations with Optiver’s objectives.

Use our Interview Guides section to read about other candidates’ journeys and insights. This can help you understand the skills and qualities that have been successful in similar roles.

Enjoy and Learn from the Experience

Treat the interview process as a learning experience. Even if you don’t get the job, the process can provide valuable insights into the industry and personal growth.

Technical and Behavioral Preparation

Reflect on your past experiences and how they demonstrate the skills and qualities Optiver values. Prepare to discuss examples that showcase your problem-solving abilities, teamwork, adaptability, and resilience.

Revisit technical concepts using our Interview Questions, which cover a range of topics, including data science, machine learning, and more. These questions can help you prepare for both technical aspects and behavioral scenarios relevant to Optiver.

Mock Interviews and Practice

Conduct mock interviews to practice your responses, especially for behavioral questions. This can help you articulate your thoughts more clearly and confidently during the actual interview.

Utilize Interview Query’s Mock Interviews service to practice your responses in a simulated interview environment. This is particularly useful for practicing behavioral questions and receiving constructive feedback.

Stay Updated on Market Trends

For trading roles, staying informed about current market trends and global financial news can be beneficial. This knowledge can demonstrate your interest and aptitude for trading.

Consider resources such as our Blog, which often features articles on industry trends and insights.

Final Review

Ensure you have all necessary documents and materials ready. Have a clear understanding of the interview schedule, and if it’s virtual, check your technology setup in advance.

If your interview is virtual, Interview Query’s Takehomes offer a platform where you can engage in longer, more complex problems similar to those you might face in an interview, making sure your technical setup and skills are sharp.

We wish you the best of luck in your interviewing process with Optiver.

If you want to know about questions targeting any specific position, read our Interview Guides for Optiver’s Data Analyst, Scientist, and Software Engineer roles.

If you’re looking for broader options, consider applying to other companies. Our Company Interview Guide provides an array of choices, from Meta and Amazon to Airbnb.

May your preparation and passion lead you to success and open the doors to new professional adventures. Remember, every interview experience, regardless of the outcome, is a stepping stone in your career path.

Good luck!

What is Optiver’s core business, and how does it stand out in the financial trading industry?

Optiver specializes in high-frequency trading and market making, distinguishing itself by integrating advanced technology and quantitative research in its trading strategies. This approach places Optiver at the forefront of the industry in terms of innovation and market liquidity contribution.

What opportunities for career progression and skill development does Optiver offer?

Optiver provides extensive opportunities for career growth and skill enhancement, emphasizing continuous learning, training programs, and professional development across various roles.

What is the company culture like at Optiver, and how does it support employee growth and development?

The company culture at Optiver is dynamic, collaborative, and innovation-driven. It supports employee development through a focus on teamwork, open communication, and a balance between high performance and well-being.