I went to work at a derivatives desk at a big investment bank almost 10 years ago, and at the time there was sort of a standard model for how banks and trading firms acquired quants. (To be clear, I was not a quant.) Basically you'd go to a physics Ph.D. student and say: Look, if you stay in physics, you will work for years on some abstract problem, making only slow progress to some vague impractical goal, and also you will be poor. If you come to a bank, you will solve real problems every day, and you will be rich. And the physicists would scoot off to the banks, where they'd immediately stop doing physics. They'd do a different thing, called "quantitative finance." (Derivatives pricing, quantitative risk modeling, that sort of thing.) It uses some of the mathematical techniques and Brownian-motion intuitions of physics, but the problems and equations are different.
Nishant Kumar and Katia Porzecanski have an article about how trading firms acquire quants today, and it is subtly different. There is some superficial stuff (hackathons!), but overall the way that quant-focused firms like Winton, Two Sigma and Citadel recruit is much more academic than it used to be:
In September, Two Sigma will take over “The Bridge,” a space on the new Cornell Tech campus on Roosevelt Island in New York, where engineers and entrepreneurs will work."By having our employees able to sit in the same room, share the same coffee with the academics, we find that there’s a fantastic osmosis," says the chief executive officer of Man Group. "It’s a bit like CERN where scientists worked together to discover the Higgs particle," says the head of human capital at Winton....MORE
The hedge fund staff will collaborate with Cornell students and professors on machine learning and data science projects, creating a pipeline of academic talent to the firm.
Tuesday, March 7, 2017
"Quant Hiring and Friendly Tippers"
Matt Levine at BloombergView: