Table of Contents
Jeffrey Wang sits down for a candid, no-fluff interview about how a professional trader actually operates—from his years running FX derivatives and G10 spot at Morgan Stanley to his current role as Head of Americas at Amber Group. If you’ve wondered how a bank-desk options pro thinks about risk, flow, and execution—and how those skills translate to Bitcoin and altcoins—this conversation is the good stuff, straight from a practitioner who’s priced size, managed complex books, and now builds crypto infrastructure.
In this piece, you’ll learn Jeffrey’s core trading framework: why market-making forces you to balance view vs. flow, how to hedge creatively when the book is the “wrong” way, and why stablecoins, tighter spreads, and pro-grade tooling have made crypto trading more like FX—just with far more volatility. You’ll also get his take on altcoin liquidity traps, fee realities, and how to choose platforms and execution methods that won’t torpedo your edge.
Jeffrey Wang Playbook & Strategy: How He Actually Trades
The market-maker mindset (flow first, views second)
Market-makers survive by balancing what they think with what the flow is telling them. Jeffrey Wang approaches markets like a dealer: read client flow, manage inventory, and stay nimble. Here’s how to apply that mindset in your own account.
- Keep a running “inventory” ledger: long/short by product, duration, and delta; rebalance when any leg exceeds +/− 30% of your total risk.
- Separate view from book: if your bias conflicts with your position, hedge the book first, then express the view with a small, defined-risk trade.
- Quote both sides to yourself: before you click, write the price you’d sell and the price you’d buy—if your intended fill doesn’t sit between them, you’re chasing.
Risk is a position; a hedge is a decision.
Professionals don’t “hope”—they hedge or they flatten. Wang’s rule of thumb is to neutralize the risk you don’t want while keeping the exposure you do want.
- If a position moves 1R against you and your thesis is unchanged, convert part of it to a spread or collar; don’t just widen the stop.
- Flatten basis risk: if you’re long BTC but the trade is really an ETH thesis, switch into the right underlying instead of proxying.
- Time-box conviction: set a maximum time stop per idea (e.g., 3 sessions) even if the price hasn’t hit invalidation.
Volatility first, direction second
Coming from FX options, Wang treats volatility as the primary input. Even in spot, implied, and realized vol shape entries, sizing, and exits.
- Scale size inversely to 10-day realized vol: Position%n % = TargetRisk ÷ Vol. Halve size if vol jumps >50% week-over-week.
- Trade less when vol-of-vol spikes: cut frequency and widen targets; add only at pre-planned levels.
- When implied vol is rich vs. realized, prefer structures (spreads, collars) over naked direction.
Liquidity, spreads, and slippage: trade like a desk
Tight spreads and deep books are an edge you choose. Wang treats venue and timing as part of the trade, not an afterthought.
- Pre-define “good liquidity” for each pair: minimum top-of-book size, max spread (in bps), and acceptable slippage per $10k.
- Stage orders where the book refills (prior micro-balance zones); avoid thin air around obvious highs/lows.
- If slippage on a test clip exceeds the plan, pause and switch venues before scaling.
Flow tells the story—read it.
Dealer flow patterns often front-run ranges and breakouts. You can approximate this by watching where liquidity absorbs and rejects the price.
- Mark absorption: three or more rejections at the same price with decreasing wicks → place staggered entries just in front with tight invalidation behind.
- Track who’s in control via session footprints: if Asia drives and NY fades, favor mean-reversion; if NY extends Asia, favor continuation.
- When a level breaks but spread widens and depth vanishes, treat it as a potential fake—scale in only after the book normalizes.
Defined invalidation beats perfect prediction.
Pros survive by being wrong cleanly. Wang emphasizes crisp invalidation and mechanical exits over opinions.
- Write your invalidation as a state change (“higher-low fails below X on closing basis”), not a line; exit on the first confirmed state flip.
- Use OCOs (one-cancels-other) so targets and stops are live from entry; never “manual stop” during news.
- If the price touches your stop twice in the same session, stand down for the rest of the day on that product.
From FX to crypto: what carries over (and what doesn’t)
The playbook transfers—only faster. Crypto trades like FX with bigger gaps and more regime swings.
- Treat weekends like emerging-market Mondays: halve size and widen stops by 1.5× from Friday close to Sunday open.
- Mind funding and basis: fade stretched premiums rather than naked shorting spot in strong uptrends.
- If your edge is execution, stick to majors (BTC/ETH) during events; push out on the curve to alts only when depth and spread meet your thresholds.
Building the trade: scaffold, don’t wing it.
Wang builds positions like a dealer building a book—pieces placed for purpose, not vibes.
- Enter in three clips: 40/30/30 at pre-mapped levels; the final add triggers only if volatility remains under your cap.
- Always attach a hedge candidate at entry (e.g., correlated pair or micro-futures) and pre-write when it activates (drawdown, time, or vol spike).
- Scale out into refills: take 50% at first liquidity pool, trail the rest behind the last higher-low/lower-high.
Routine and review: yesterday’s book funds today’s risk
Discipline is a workflow. Wang’s day is built around inventory review, scenario prep, and after-action notes.
- Pre-open: mark three scenarios (trend, mean-revert, chop) with levels, expected vol, and your play for each.
- Mid-session: if you log two execution mistakes, stop trading and write the fix; protecting the book beats forcing the day.
- Post-close: journal numbers, not feelings—vol, slippage, spread, win/loss by setup; kill any setup with three losing weeks.
Platform, tooling, and costs: respect the microstructure
The wrong venue is a hidden tax. Wang optimizes for spread, depth, reliability, and operational risk.
- Hard-cap total fees (taker+maker+funding) as % of expected move; if fees > 20% of target, pass.
- Use alerts on order-book imbalance (e.g., bid/ask depth ratio) to time adds/reduces instead of chasing candles.
- Run a weekly venue audit: compare realized slippage and downtime; route size only to venues that beat your baseline.
Altcoins and liquidity traps
High beta can mask low quality. Wang treats most alts as tactical trades, not core inventory.
- Define “tradable” alt criteria: daily dollar turnover > your 20× clip, spread < 15 bps, and consistent depth across sessions.
- Never hold illiquid alts through catalysts you can’t hedge; express the theme via majors or indices.
- If market cap < threshold or dev/news risk is binary, use options/structured exposure where possible instead of spot.
Execution: precision beats prediction
Your edge lives in how you get filled. Dealer habits—patience, partials, and pre-borrow equivalents—transfer directly.
- Use iceberg/limits at re-offer/re-bid zones; avoid sweeping into widening spreads.
- If a breakout prints but the retest fails to hold VWAP or prior micro-balance, abort the idea immediately.
- During event windows, trade the second move: skip the initial spike and engage only after spreads normalize and the first pullback sets.
Capital allocation and heat
Staying alive is the strategy. Wang sizes heat by volatility and correlation, not vibes.
- Cap portfolio heat at 3R max across correlated assets; if BTC and ETH both fire, treat them as one bucket.
- Increase size only after three consecutive green weeks with drawdown < 1.5R; reset to base size after a 3R week.
- Keep a cash buffer equal to two worst historical weeks to avoid forced liquidation during vol shocks.
Size Risk Like a Pro: Inventory First, Opinion Second
Jeffrey Wang reminds us that every trade starts with your book, not your bias. Before he decides what he thinks will happen, he checks what he already holds—longs, shorts, and exposure by product and duration—and sizes the next move to fix the inventory, not feed the ego. That means reducing outsized risk buckets first, then expressing any view with a small, defined-risk add. If the inventory says you’re effectively all-in on one theme, the next trade is a hedge, not a hero shot.
Wang also ties position size to volatility, so the same idea doesn’t carry wildly different danger on different days. When realized vol jumps, he cuts clip size and slows down execution; when vol compresses, he scales back in but never lets a single idea dominate portfolio heat. He treats correlation as part of size—BTC and ETH are often one bucket—so “two trades” don’t double-count as safety. The net effect is simple and powerful: manage the book like a dealer, then let opinions ride only after the inventory is clean.
Volatility Sets the Bet: Scale Up and Down Systematically
Jeffrey Wang treats volatility like the throttle on risk—when speed rises, he eases off; when it slows, he presses gently. He sizes each position relative to recent volatility, so the same setup doesn’t secretly carry double the danger after a wild week. If realized volatility spikes, he cuts clip size and widens targets so noise doesn’t shake him out. When volatility compresses, he allows slightly larger size but keeps stops tight to avoid dead-money churn.
Wang also watches “vol-of-vol,” because unstable volatility can be more dangerous than high volatility itself. If the tape is whippy and spreads widen, he trades less frequently and waits for the book to normalize before adding. He prefers defined-risk structures when implied volatility is rich versus realized, rather than swinging naked direction. The goal is consistent portfolio heat: let volatility dictate bet size, not mood, so good process—not lucky timing—drives the equity curve.
Hedge What Hurts, Keep What Helps: Defined Risk Every Trade
Jeffrey Wang’s rule is simple: if a position is bleeding for the wrong reason, hedge it—don’t pray. He separates the view from the book by neutralizing the unwanted exposure first, then re-expressing conviction with a smaller, defined-risk structure. That can mean converting a naked spot trade into a spread or collar so the thesis lives while tail risk dies. By trimming the pain and preserving the edge, he lets the right risk earn while the wrong risk gets boxed in.
Wang also fixes basis and correlation mistakes fast: if the idea is really ETH but you’re long BTC, switch to the proper underlying and cap the risk with OCO orders. He time-boxes conviction so stale trades can’t linger—if price or conditions don’t confirm within a set window, he flattens or hedges down to a token slice. During event or high-vol windows, he scales into protection first, then adds back only after spreads normalize. Defined risk isn’t optional in his playbook; it’s the operating system that keeps the account alive for the next great setup.
Liquidity Is an Edge: Choose Venues, Control Slippage, Time Entries
Jeffrey Wang treats venue selection like part of the trade, not a footnote. He wants tight spreads, consistent depth, and reliable matching so the edge isn’t taxed by hidden costs. Before scaling, he tests slippage with a small clip; if execution is sloppy or the book thins at obvious levels, he switches venues rather than forcing fills. He times entries when spreads contract and the book refills after a sweep, aiming to buy at re-bid zones and sell at re-offer zones, not in the vacuum between.
Wang also builds rules around microstructure so execution stays mechanical. He defines acceptable spread (in bps) and max slippage per $10k, and stands down if either threshold is breached. He stages limit orders where absorption previously showed up, instead of chasing candles through widening spreads. When a breakout prints but the order book vanishes, he waits for depth to normalize before committing size. In short, Jeffrey Wang turns liquidity into a repeatable advantage by choosing the right venue, enforcing cost limits, and letting the book tell him when to strike.
Process Over Prediction: Routine, Reviews, and Rules Drive Consistency
Jeffrey Wang builds his edge around routine, not hot takes. He starts each day by mapping scenarios—trend, mean reversion, or chop—and writing the exact actions he’ll take for each. Predefined plays remove hesitation when the tape speeds up, so he’s executing a plan instead of narrating the market. Checklists and time blocks keep him from overtrading when volatility seduces or bores him.
After the close, Jeffrey Wang audits numbers, not feelings—volatility, slippage, spread, win rate by setup, and heat by correlation. If a setup logs three losing weeks, it’s benched until data proves it again; if it records two execution mistakes in a session, it shuts it down for the day. Rule breaches trigger automatic size cuts the following week, forcing discipline back into the system. The result is a process that compounds small edges and quickly trims behaviors that bleed.
Jeffrey Wang’s edge comes from thinking like a dealer first and a predictor second. He inventories risk before voicing an opinion, then sizes every bet to current volatility so one noisy day can’t torpedo the account. When the book is the “wrong” way, he fixes the exposure fast—hedge, switch underlyings, or flatten—then re-expresses conviction with defined risk. That discipline extends to execution: choose venues for tight spreads and stable depth, test slippage with a small clip, and only scale when the order book normalizes after a sweep.
He also shows how FX habits translate to crypto without the romance. Treat BTC and ETH like currency pairs, use stablecoins as a clean parking lot for USD-denominated P&L, and remember that many altcoins trade like micro-caps with story risk and patchy liquidity. Process is the through-line: map scenarios before the open, log numbers (not feelings) after the close, bench underperforming setups, and cut size after rule breaches. If you copy just one thing from Jeffrey Wang, make it this: protect the book with mechanics, then let your views earn the right to stay on.
