careers in systematic investing: advice and perspective at the end by matthew granade
TRANSCRIPT
So you want to be an investor
QuantCon 2015 3.14.15
What is inves;ng? Why is it interes;ng?
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Observe the world
Formulate hypotheses Test
So you want to be an investor…
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Are you inves:ng right now?
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Do. Or do not. There is no try.
So you want to be an investor…
Opportunity is everywhere
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Ideas Data Tools Execu:on
What do you need to decide to be investor?
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1. What is your style?
2. How will you manage the piIalls?
3. How will you compound?
1. What is your style?
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• Long/short
• Equi:es
• Fundamental + technical
• Discre:onary
• 50+ porIolio managers w/ one ‘uber’ PM
• One month horizon
• Long/short
• Bonds, currencies, commodi:es, equi:es
• Fundamental
• Systema:c
• 1 “porIolio manager”
• Six month horizon
Fund “P” Fund “B”
1. What is your style?
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“Where would you put your money?” Mr. Ackman asked... “Let’s say you were to buy one asset, or one stock, or one market, or one currency.” There was a pause. “I don’t do that,” Mr. Dalio said. “O.K,” Mr. Ackman said. “I’m sorry,” Mr. Dalio said.
-‐ From Feb 12, 2014 interview at Harbor Conference, New York
1. Dimensions of style
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• Long only vs. long/short • Asset class(es) • Strategy, e.g., - Fundamental - Technical - High frequency
• Discre:onary vs. systema:c • Concentrated vs. diversified • Investment horizon
1. Lot of style choices, some of them good
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2. Prepare to be wrong.
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"It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong.”
-‐-‐ George Soros
“If you can’t understand it, don’t do it”
-‐-‐ Charlie Munger
“Anything can happen in stock markets and you ought to conduct your affairs so that if the most extraordinary events happen, that you’re s:ll around to play the next day.“
-‐-‐ Warren Buffeg
2. The risk of blowing up
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2. Get yourself in the right headspace
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3. How will you compound?
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Learning from your own stuff Learn from others’ stuff – pictures of two big books
3. Record your history, learn with ;me
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• What trade did you make?
• Why did you make it?
3. Learn from others
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What do you need to decide to be investor?
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1. What is your style?
2. Are you prepared for the piIalls?
3. How will you compound?
Repeat un)l rich.
A par;ng thought…
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“Never give up searching for the job that you’re passionate about. Try to find the job you’d have if you were independently rich. Forget about the pay. When you’re associa:ng with the people that you love, doing what you love, it doesn’t get any beger than that.”
-‐-‐ Warren BuffeF