A Special Opportunity
I don’t write a lot about Kinetic Trading, since my karma boomerang/heavy sharing modus operandi kind of stops when talking about identifying, developing and exploiting sustainable informational advantages. However, I feel compelled to pen something since a pretty cool opportunity has arisen at the company which will be the right fit for a very interesting, creative, high-IQ person. And it is somewhat unique in that the right person will be a mix of technologist, portfolio manager, trader, risk manager, optimization guru and data geek operating in a hybrid tech start-up/trading environment. And they will have a healthy degree of humility when applying their sizable intellectual powers towards taming the markets.
Kinetic Trading has a distinctly different culture than your average quantitative/stat arb hedge fund. It feels more start-uppy and collaborative, and occupies a space and mind-set quite different than the normal quant fund. Different uses of data, different platforms and frameworks, different approaches for extracting alpha at scale. It isn’t simply a squadron of math and physics Ph.Ds. We have those, too. But to be clear, we most assuredly DO NOT suffer what Rick Bookstaber so eloquently wrote about in a recent post discussing “Physics Envy in Finance.”
The markets are not physical systems guided by timeless and universal laws. They are systems based on creating an informational advantage, on gaming, on action and strategic reaction, in a space without well structured rules or defined possibilities. There is feedback to undo whatever is put in place, to neutralize whatever information comes in.
The natural reply of the physicist to this observation is, “Not to worry. I will build a physics-based model that includes feedback. I do that all the time”. The problem is that the feedback in the markets is designed specifically not to fit into a model, to be obscure, stealthy, coming from a direction where no one is looking. That is, the Knightian uncertainty is endogenous. You can’t build in a feedback or reactive model, because you don’t know what to model. And if you do know – by the time you know – the odds are the market has changed. That is the whole point of what makes a trader successful – he can see things in ways most others do not, anticipate in ways others cannot, and then change his behavior when he starts to see others catching on.
The Kinetic Trading team gets the joke. In fact, the ethos of the company is in clear recognition of the perils of treating the markets like science project.
Kinetic Trading applies the latest technologies (including leveraging open source tools and applications) to systematically generate alpha at scale. The company has a great team, supported by terrific partners and advisers to help prosecute the opportunity. But this specific role is critical in helping Kinetic Trading best monetize its data and IP. Perhaps you’re the right person to make it happen.
You can get a full description of what Kinetic Trading is looking for and apply for the position here: http://bit.ly/KineticPMT.
