Physics PhD at MIT is no garantee of working on 'impressive proprietary models'. Actually, that was pretty much my point. Firms that are not in the flow dealing complex instruments will rarely find any use in 'developing impressive proprietary models' (for pricing). Banks are highly leveraged on pricing correctly the exotics they buy and sell for a high margin. In banks, traders care about 7th, 8th moment. I doubt that will ever be the case at any buy side firm.
What are these people working on? I find it puzzling that Fidelity doesnt market itself as a quantitative fund manager (which is itself undergrad maths), yet have 'impressive proprietary models' in their research department while it cannot bring them much money since they are not the ones who deal the instruments. They pay spreads to fight against another large bunch of physics PhDs who cash in spreads. Who do you think will win?
Job of fidelity is to take view on the markets. And no 'impressive proprietary models' (at par with those for modelling/pricing all the stuff a bank trades) can help that. One just has to compare 'quantitative research' published by a bank and 'quantitative research' used on its own trading desks. Difference in required skills is quite clear.
cfa2grunt Wrote:
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> I happen to know folks in research at Fidelity who
> have invested considerable time and resources in
> developing impressive proprietary models. These
> are people with quantitative PhDs from MIT and
> other good schools with significant experience.
> Fidelity is a lot more sophisticated than you
> realize, cosine.
Edited 1 time(s). Last edit at Friday, July 7, 2006 at 07:45PM by cosine.
What are these people working on? I find it puzzling that Fidelity doesnt market itself as a quantitative fund manager (which is itself undergrad maths), yet have 'impressive proprietary models' in their research department while it cannot bring them much money since they are not the ones who deal the instruments. They pay spreads to fight against another large bunch of physics PhDs who cash in spreads. Who do you think will win?
Job of fidelity is to take view on the markets. And no 'impressive proprietary models' (at par with those for modelling/pricing all the stuff a bank trades) can help that. One just has to compare 'quantitative research' published by a bank and 'quantitative research' used on its own trading desks. Difference in required skills is quite clear.
cfa2grunt Wrote:
-------------------------------------------------------
> I happen to know folks in research at Fidelity who
> have invested considerable time and resources in
> developing impressive proprietary models. These
> are people with quantitative PhDs from MIT and
> other good schools with significant experience.
> Fidelity is a lot more sophisticated than you
> realize, cosine.
Edited 1 time(s). Last edit at Friday, July 7, 2006 at 07:45PM by cosine.