Wallstyouth
Vice President
- Joined
- 5/25/07
- Messages
- 116
- Points
- 28
Thu May 31, 2007 1:07PM EDT
NEW YORK (Reuters) - Wall Street equity analysts have had their share of problems in recent years, from regulatory heat to budget cuts to a loss of star power and prestige.
Now, with the growth of quantitative analysis, some are facing a worse possible fate: being supplanted by computers. At an increasing number of Wall Street investment banks, hedge funds and elsewhere, computers are churning out investment analyses culled from enormous pools of data. And some say they're more objective than human-based reports in determining which stocks, bonds or currencies to buy or sell. Increasingly, such programs are used to turbocharge traditional research.
"Given the same set of factors, it will always produce the same result," said quant industry veteran Tanya Beder of quantitative analysis. "Its signals are pure and systematic."
Beder, who built the quant trading division of top-performing hedge fund Caxton Associates LLC and was chief executive of Citigroup's (C.N: Quote, Profile, Research Tribeca Global Management in 2006, estimates that quantitative analysis and trading "drives one-third of the market" on any given day. The trend has made quantitative specialists, or quants, among the most highly valued on Wall Street, with top players commanding seven-figure salaries, similar to stock analysts a decade ago.
"There's great demand for these rocket scientists," said Sandy Gross, managing partner at Pinetum Partners, a Greenwich, Connecticut-based executive search firm specializing in hedge funds. "They don't necessarily come out of financial services, but have a strong background in mathematics and statistics that can be applied to all asset classes."
More: http://www.reuters.com/article/reut...31?pageNumber=1
NEW YORK (Reuters) - Wall Street equity analysts have had their share of problems in recent years, from regulatory heat to budget cuts to a loss of star power and prestige.
Now, with the growth of quantitative analysis, some are facing a worse possible fate: being supplanted by computers. At an increasing number of Wall Street investment banks, hedge funds and elsewhere, computers are churning out investment analyses culled from enormous pools of data. And some say they're more objective than human-based reports in determining which stocks, bonds or currencies to buy or sell. Increasingly, such programs are used to turbocharge traditional research.
"Given the same set of factors, it will always produce the same result," said quant industry veteran Tanya Beder of quantitative analysis. "Its signals are pure and systematic."
Beder, who built the quant trading division of top-performing hedge fund Caxton Associates LLC and was chief executive of Citigroup's (C.N: Quote, Profile, Research Tribeca Global Management in 2006, estimates that quantitative analysis and trading "drives one-third of the market" on any given day. The trend has made quantitative specialists, or quants, among the most highly valued on Wall Street, with top players commanding seven-figure salaries, similar to stock analysts a decade ago.
"There's great demand for these rocket scientists," said Sandy Gross, managing partner at Pinetum Partners, a Greenwich, Connecticut-based executive search firm specializing in hedge funds. "They don't necessarily come out of financial services, but have a strong background in mathematics and statistics that can be applied to all asset classes."
More: http://www.reuters.com/article/reut...31?pageNumber=1