Quick background: running a CTA using technical models developed over time after coming from discretionary prop trading. Work with a few allocators who have seemingly been happy with performance so far. At the beginning of the year, one of the allocators asks me if I'll work with this "new talent" he's found and wants to cultivate. I agree under the conditions that he have nothing to do with my current programs, and then maybe we can develop something together. At the time I figured what the heck, the allocators paying him and I want to keep the guy happy. So the quant comes into the office for the past 2 weeks and so far all I know is that he is good at getting lunch and bad at making restaurant reservations! So now what? I've worked with quants before who were either introspective like rainman or hyper to the point that they were seemingly on some combo of crystal meth and jolt cola. But this guy is just a zombie, doesn't speak at all, and hasn't done a thing yet. I was expecting him to just come in and do his thing, maybe I'd pull his head out of the sand every once in a while, and teach him a little bit about trading. While this has been mildly amusing for the past few weeks, I'm now starting to grow slightly concerned if asked for a progress report. The allocator knows that I am not a math guy, so I'm not certain how to lead this guy. So what should I have this guy do? I've got access to good market data, but what relevant stats should I have him compile? My thought was to just have him calculate a bunch of stats and then try to find some statistical significant relationships that could potentially be traded off of. But where to begin? I will share the results of his findings with anyone willing to help me out with a starting point or a plan to follow. Provided of course that this guy can do it. PM if necessary. Man, the sh!t I get myself into lol. Thanks in advance.
if your already successful.. why do you need a quant? i'm a skeptic you have intellectual property that is up for the taking.. i'd be careful..
Quants are essentially a programming & datamining interface. If you can't explain what you need in plain English then you should both be shit-canned. Sorry to be blunt.
This. Sounds like the guy is either useless or a spy. Have a significant talk with your allocator and make him tell you exactly what he sees in the guy that deserves cultivating.
i agree with the interface part .... the guys a tool.. use him.. if i were you.. i would put the guy working on stuff that doesn't relate to my current strats.. use him to look for new ones.. you could as a trader i'm sure generates thousands of questions to ask data and get him to find the statistical significance to it.. the guys check isn't coming from your pocket.. you should put him on some stuff you have been curious about to see if you can discover something new.. meanwhile i'd keep your current edge to yourself.. look at him like a free research option respectively..
Thanks for the replies guys. Caveman, my paranoia meter was the first thing that popped up, but my stuff is protected on a secure server offsite and this guy doesn't have access to anything. I'm not worried about theft of IP. For the rest of you, I don't need a quant. This guys was sort of foisted on to me and I initially said yes cause I figured this guy would be plug and play like the guys I had worked with in the past. I don't have anything I want or need done, I'm just concerned I'll be put in a bad position if this guy doesn't do anything. I've asked I'm what he looking to do, what areas he's looking to explore, etc. said he didn't know. A lot of you have PM'd me some cool project ideas but I think I'm just gonna spend the weekend on Wilmott and figure out some stuff this guy can do. Thanks to those who were helpful, and of course the usual eff you to those who weren't.
This is exactly what I decided to do. I figured I'd cull a few ideas here and then share the results with the person who suggested it (them). Gonna give it a try next week. Will let you know how it goes.
If you're a CTA (not a CPO) then they have access to you fills anyway. Why would they send in a quant to steal your IP? If you're paranoid then why did you let him in?