As hedge fund employers go, quant fund Two Sigma is one of the most aspirational. It ranked third on our list of the hedge funds everyone wants to work for this year, confirming that it has the pick of the crop when it comes to employees. Interestingly, therefore, plenty of Two Sigma’s U.S. have a period of unemployment in their past. Some were even hired out of unemployment by the fund itself.
We know this because staff at Two Sigma (and elsewhere) have to declare periods of unemployment on their FINRA registration. Of the 95 staff currently registered to Two Sigma Securities, 19 have had a period out of work – 20% of them.
Some of this downtime came after graduation. Two Sigma likes to hire from the likes of Stanford and MIT. While graduates going into banking tend to line up job offers through internships before they leave, graduates (and PhDs) going into Two Sigma are more likely to have several months out of the market doing nothing before they land a place. Up to seven months is not unusual.
Other of Two Sigma’s employees have worked for banks or other funds and have had periods of economic inactivity between roles. These are distinct from hedge funds’ notorious non-competes, although these are also in evidence on the FINRA documentation. Jason Auerbach, for example, joined from Jump Trading back in 2013 after a mandatory nine months out of the market.
Most notable, however, are the people Two Sigma hires who are unemployed. There haven’t been any recently, but there have been several in the past, including Thomas Matchett who joined in 2016 and spent a year out of the market after leaving UBS, or Jongman Koo, who joined three years ago after 11 months of unemployment post-Getco.
While 80% of Two Sigma’s staff haven’t spent time out of the market, a reassuringly large portion have. Redundancy should not keep you from working for one of the most popular quant funds in the world. Meanwhile, Two Sigma may be making some layoffs of its own. – The fund acquired the interactive options arm of Timber Hill in May 2017. It’s not clear how many people were employed there, but only a handful have made it onto Two Sigma’s books.