Capital AdvisorsĪ long career in finance - with stops at well-known quant fund PDT and a long stint at Morgan Stanley - preceded Denis Dancanet's foray into aviation.ĭancanet, the recently announced head of Steve Cohen's Cubist unit, started a jet propulsion start-up known as Jetoptera, which has several patents. Steve Cohen, founder of hedge fund Point72 Asset Management and now-closed S.A.C. While many of these firms have women building systems and strategies, the leadership of the space does not have much diversity at all. The list is also an indication that despite the asset management's industry outward promise of increasing diversity, the top of the space is still overwhelming male and white. It's one of the few pools of skilled workers where the hedge fund industry is not always able to give the most lucrative offer, as top hedge funds often have to compete with Silicon Valley for the best of the best. The talent to do all this, of course, does not come cheap. How they process, structure, and clean the data will be one of the biggest differentiators from their competitors. The power players of the industry are often a part of the firm's data leadership, if not holding the purse strings of their data budgets themselves. Lopez de Prado, in a recent webinar, said the biggest challenge the industry faces is "how can we make sense of the tremendous amount of data we have today that was not available three to five years ago?" Artificial intelligence and machine-learning techniques have spread across the industry to help digest the reams of data feeds that are the industry's lifeblood others are attempting to bring the quant strategies that worked so well in equities to the fixed-income space. Marcos Lopez de Prado, the former head of machine-learning at AQR and a professor at Cornell, believes quants need to get away from models and focus on " nowcasting" - reacting rapidly new data as it comes in. What quant investing looks like in the next decade will largely be driven by the power players on this list - a combination of billionaire stalwarts, under-the-radar heavy-hitters at big-name funds, and new founders.Īnd there's some general disagreement about what the next evolution of quant looks like. Here's how hedge funds and banks are being forced to rethink one of the earliest alt-data plays. Meanwhile, the unprecedented volatility in the markets in March caused many big-name quants to lose money, as their models struggled to keep up.įunds such as Coatue's data-driven systematic strategy and Credit Suisse's QT Fund shut down thanks to the volatility and the unreliability of data during the beginning of the shutdown in the US. The rapid - and emotionless - trading done by them have caused investors like billionaires Stanley Druckenmiller and Leon Cooperman to argue that they are warping the markets. And these strategies - increasingly popular over the last decade - do not operate in a vacuum. Quants are now kingmakers in the $3 trillion hedge-fund industry, with nearly every major fund dedicating ample resources to the space, whether it's capital for strategies or resources for hiring and data feeds. The future of quant investing is the future of finance.
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