Selling my stock picking algorithm to hedge funds/investment firms. Where do I start?

I'm a C++ programmer and my friend and I recently made a nice little trading strategy that was able to gain 5000% over a simulated trading period and in another experiment, turned $5000 into $100,000.

I know hedge funds get hit with scores of these things daily but we've both back-tested our strategy as well as on current live data and they both work well.

I'm trying to sell it to hedge funds, much cheaper than what they're paying their own programmers. Anyone ever heard of hedge funds buying stuff like this from people? Where should I start?

 

We just wanted to make the quick buck and get out...maybe latch on later as consultants. Plus, we don't have enough money to really make something out of it so soon...trading isn't really part of our longterm career interests really. Kind of just want to get it over with :D

 

I don't really know anything about trading, but I am really good with C++ and it would take a good trader about two weeks to learn everything you would need to know to write it yourself.

Ace all your PE interview questions with the WSO Private Equity Prep Pack: http://www.wallstreetoasis.com/guide/private-equity-interview-prep-questions
 
getyourhandsup:
it was 100k over a simulated 10 years based on historical data

That means this algorithm only makes about 40% annually. Not too shabby, but stating a giant percentage increase without including the time period is just sensationalist.

I realize this is an old post, but I'm trying to do the same thing. I have a few algorithms that I've backtested, and I have no interest in selling these to anyone. Even with a modest starting investment, after a couple of years it would be worth big money. Unless they'd be willing to go pretty huge on the purchase price, I'd just use it for myself.

 

sounds like you have no clue what you're doing. so, if you have a PhD from a top tier school in a totally unrelated yet supposedly impressive science or science-y sounding thing and you're able to reference obscure-sounding theorems (eg. Chernkowsky-Yang Conjecture) in your materials, i'd say your chances are good!

 

This is awesome. I remember when I was 12 and discovered trading. I actually started out studying computer engineering, and I thought that I would find the holy grail also.

So you back tested your results.

Whats your percentage of "right" in the model? What is your average capital commitment to each position?

two things: Slippage the market's ability to remain irrational longer than you can remain solvent

 

Illo magnam non veritatis molestiae et. Voluptate eos aut est tenetur quos voluptate alias ad. Pariatur placeat eveniet nulla molestiae placeat. Ullam sunt quia dolores possimus rerum dolores. Consequatur iste sed qui optio ex possimus. Voluptatem natus maiores a fugiat ut ut.

Quis enim dolore quasi et. Enim eum atque nihil ut qui est. Et aut et aspernatur laudantium perferendis itaque similique.

Ipsam ad cum est autem. Vel commodi nobis ipsam quis molestiae sint deserunt autem. Ut ut debitis non et accusantium assumenda.

Career Advancement Opportunities

March 2024 Hedge Fund

  • Point72 98.9%
  • D.E. Shaw 97.9%
  • Magnetar Capital 96.8%
  • Citadel Investment Group 95.8%
  • AQR Capital Management 94.7%

Overall Employee Satisfaction

March 2024 Hedge Fund

  • Magnetar Capital 98.9%
  • D.E. Shaw 97.8%
  • Blackstone Group 96.8%
  • Two Sigma Investments 95.7%
  • Citadel Investment Group 94.6%

Professional Growth Opportunities

March 2024 Hedge Fund

  • AQR Capital Management 99.0%
  • Point72 97.9%
  • D.E. Shaw 96.9%
  • Citadel Investment Group 95.8%
  • Magnetar Capital 94.8%

Total Avg Compensation

March 2024 Hedge Fund

  • Portfolio Manager (9) $1,648
  • Vice President (23) $474
  • Director/MD (12) $423
  • NA (6) $322
  • 3rd+ Year Associate (24) $287
  • Manager (4) $282
  • Engineer/Quant (71) $274
  • 2nd Year Associate (30) $251
  • 1st Year Associate (73) $190
  • Analysts (225) $179
  • Intern/Summer Associate (22) $131
  • Junior Trader (5) $102
  • Intern/Summer Analyst (249) $85
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Betsy Massar's picture
Betsy Massar
99.0
3
Secyh62's picture
Secyh62
99.0
4
BankonBanking's picture
BankonBanking
99.0
5
kanon's picture
kanon
98.9
6
CompBanker's picture
CompBanker
98.9
7
dosk17's picture
dosk17
98.9
8
GameTheory's picture
GameTheory
98.9
9
DrApeman's picture
DrApeman
98.9
10
numi's picture
numi
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”