Morning Coffee: Bored people earning $500k find fulfilling $400k alternative. NFTs become more strange
Quants working in hedge fund jobs are very well paid. A salary survey this summer from recruitment firm Selby Jennings said that junior quant researchers in U.S. hedge funds can up to $500k, that mid-ranking quant researchers can earn up to $750k, and the most senior ones can get a cut of the profits they help generate.
While this may sound sufficient to obscure all kinds of dissatisfaction at work, apparently it is not. Hedge fund quants, like everyone else, are looking for meaning. And Bloomberg says they are finding it in....self-driving cars.
"In finance, excelling at your job means making more money for your investors. In autonomous vehicles, excelling at your job means you might save lives,” reflects a 26-year-old model engineer now working for a California self-driving technology start-up, who previously spent three years in systematic FX trading at Citadel Securities.
Autonomous vehicle start-ups pay less money than hedge funds and electronic market makers, but they fly the flag of human advancement and offer more interesting work. So says Dan Franco, a headhunter who's been plucking people from quant finance and placing them into jobs in the mobility sector. “I think you’d rather earn $400k and be happily fulfilled than earn $500k and be bored,” Franco told Bloomberg. “A lot of these guys are actually more motivated by the technical challenges rather than money anyway.”
Quants working in finance might disagree that their work is boring. - The sector prides itself on its "large datasets" and challenging feedback loops. Equally, driverless vehicles may not be quite as meaningful as headhunters in the sector like to make out, and indeed it seems some hedge fund quants are simply working on autonomous vehicles to sit out their non-compete periods.
Nonetheless, finance quants who feel an urge to facilitate a future in which people can watch Netflix instead of watching the road, are able to do so. And it's not just quants - James Westwood, a newly promoted Goldman Sachs MD previously in charge of hedge fund sales for Hong Kong and Singapore, resigned in 2018 and joined Ascent Robotics, an artificial intelligence company creating self-driving vehicles. He's still there over three years later.
Separately, if you're worried about missing out on the NFT craze, it's not too late to participate. Vice reports that it is now possible to bid on a 1,784 lb cube of tungsten in Illinois. The receipt will be posted to the blockchain for posterity, and the “owner” will be entitled to one supervised visit to the cube each in order year to touch and photograph it. The highest bid is currently 47.74 ETH, or $201k.
Ralph Hamers at UBS has got a funny feeling about crypto. “Not many [market] players understand the true value of crypto: What determines the value of crypto? What are the uses of crypto? And therefore it is not something one can regard as an investment but is much more about speculation. We don’t advise on speculation, and that’s why we don’t go there." (Fortune)
There's still a shortage of public cloud engineers in finance. Two Sigma plans to hire hundreds; Point 72 is hiring 60-70. Sometimes it's a question of upskilling existing staff, who then get poached. "You know you train them for a couple years and they pop to go somewhere else. It starts to get expensive really, really fast. And it's not just happening to us, it's happening to everybody." (Business Insider)
JPMorgan disbanded its dedicated small and mid-cap trading desk in London as banks move to sectorised coverage in Europe. (The Trade)
Speaking entirely unironically at a conference in Saudi Arabia, Stephen Schwarzman addressed the issue of inclusion in financial services and said that women were previously scared of joining Blackstone but that this is no longer so. (Bloomberg)
Blackstone and JPMorgan's deal teams on the Spanx acquisition were comprised solely of women. Blackstone said this was simply the makeup of its consumer products deal team — and not the result of a public relations stunt done to appear a more inclusive corporate citizen. (Business Insider)
EY Germany wanted to scrutinise Wirecard's internal processes for payments settled by outsourcing partners in Asia, so it splashed out on a €9.95 seven-day-subscription to an Asian porn site. (Financial Times)
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