Tuesday, May 6, 2014

What is a quant trader? - Youtube interview

A very educational interview with a quant trader. Some notes that I took:

- a return of 15%-20% pa for a retail trader is good (depending on risk)
- quant traders mainly deal in the micro-second / nano-second timeframe
- retail traders should NOT compete with high-frequency quant traders
- quant traders are more interested in exploiting the physical characteristics of the exchange itself such as the exchange's physical hardware. They are less interested in traditional fundamental or chart analysis.
- institutional quant traders are more interested in managing risk than maximising profit (mainly due to investors hating volatile returns)
- a weakness of quant trading are black swan events. Quant traders may become so data-driven that they forget the possibility of extreme events that can destroy their models.

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