I’m a headhunter who specializes in systematic trading jobs at hedge funds. I’m big in this space: if you’re a top systematic trader in London or New York, you’ll know who I am. If you’re reading this, I’d also like to urge you to think about swapping jobs soon.
Right now, I’ve got a lot of roles to fill, but absolutely no one who’s willing to contemplate them. January could be different: 50 to 75 people have asked for call-backs in early 2018, but for the moment – in this time between Thanksgiving and Christmas – hedge fund hiring is even quieter than hiring in investment banks.
There are good reasons for this. Firstly, traders are worried, especially in global macro. 2017 hasn’t been a great year and people want to run it down rather than jumping before the end. Some even think they’re going to get paid up; they won’t – hardly anyone’s made any money.
The real danger, though, is that the stasis in the quant hiring market persists beyond January. The traders who haven’t made money this year won’t move next year: they’ll want to prove themselves in 2018. No one’s going to move on the back of a bad year; and no one will want to buy them anyway.
And yet, quant funds do want to hire. They’re understandably cautious: they don’t want just anyone. Most are targeting one or two particular traders whose strategies they’re familiar with. Their shopping lists are very specific. It’s up to people like me to execute them.
This leads to the next problem, which is that the best quant traders are the least mobile people in the market. Quant funds impose extremely onerous non-compete agreements on their top staff. Banks’ six month notice periods are nothing by comparison. Right now, for example, I’m trying to move someone from Two Sigma who’s on a fifteen month non-compete – even if he agrees to move in January it will be the middle of 2019 before he arrives (and before I get paid my fee). It can be worse still – there are quant traders out there whose non-competes last for two years.
This makes it hard for hedge funds to hire, particularly from other funds. To hire from rivals, funds need deep pockets to buy people out. This can be a big ask when you’re sitting on a bad year. Therefore, if things pick up a lot in 2018 you might see more hiring from investment banks. But funds and banks like different people: funds like lone wolves who can develop trading ideas on their own; banks like collegial players who work in teams. If you can persuade me you’re in the first group, maybe I’ll pitch you to my clients. If you can’t, I’ll just keep sitting here trying to persuade people to move in 2019.
James Smart is the pseudonym of a systematic trading headhunter in London
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