
Optimal hedging of an informed broker facing many traders
This paper investigates the optimal hedging strategies of an informed broker interacting with multiple traders in a financial market. We develop a theoretical framework in which the broker, possessing exclusive information about the drift of the asset's price, engages with traders whose trading activities impact the market price. Using a mean-field game approach, we derive the equilibrium strategies for both the broker and the traders, illustrating the intricate dynamics of their interactions. …