Re: ?
just21 said:
Volatile, what percentage of the money you make for the bank are you getting as bonus/ What markets are you trading? How much capital would you need to do it for yourself? Do you rely on flow information to get an edge?
regards
Hi,
You certainly take the direct approach in your questioning!
I don't work for a bank, I am a Hedge Fund Manager.
I do not get a fixed percentage of the money I make in a direct sense. Rather I get a bonus which constitutes a proportion of my fund's performance fee (20% of net new profits) while all of the management fee (2% of capital per annum) goes to the firm.
I do not actually 'trade' anything in the discretionary sense. Rather my job is to construct, test and implement systematic trading programs based on statistical anomalies.
The biggest one we use is a surprisingly simple but effective currency system. The smaller, but growing ones are both US equity / index option programs. All execution of trades is automated via our prime broker's API and settled between them and our (outsourced) back office.
This is far more relaxing than the stress of actually having to stay on top of the market all day.
How much would I need to do it myself...? Not sure really, $1.5 or $2m would make me consider it if I kept all profits. If it were client funds and I was only taking 2 and 20 then It would have to be more like $30m.
Your question about flow information is probably answered by the disclosure of our execution method. No. If the equity things get bigger we will have to put an order monkey in front of the system with a level 2 feed or something to ensure that the business can be done. At the moment the size does not warrant it as the cash business is done using equity / libor swaps and the options are done in small enough size in deep markets.
Why so much interest, if I might ask?
