A market making game for trading interviews
Learn to quote two-sided markets the way trading interviews demand: set a bid and an ask on a hidden value, trade against informed and noise flow, survive a mid-game news shock, and watch your P&L split into spread capture versus adverse selection. Free, in your browser.
Making a market means committing to buy at your bid and sell at your ask, in size, before you know which way the value will move. Do it too tight and informed traders pick you off; too wide and nobody trades with you. This game turns that tension into something you can feel across five scenarios: hidden dice and coins and cards, a mid-game news shock, and a red-minus-blue spread that can go negative.
The concepts it drills
- Fair value and spread. Start from the expected value, then quote a spread wide enough to survive the traders who know more than you.
- Adverse selection. When someone lifts your offer instantly and in full size, that is information: your ask was probably too low. The winner's curse is built into every fill.
- Inventory management. Long too much? Skew your quotes down to sell inventory faster and discourage buying more, rather than just widening.
- P&L attribution. At settlement your profit is decomposed into what you earned from the spread versus what you lost to informed flow and the news, the single most useful lens on a market maker's day.
It is the interactive companion to the market-intuition questions in the Probability Lab: after you can compute a Glosten-Milgrom ask on paper, this is where you quote one under pressure.