Starting a quant group inside a Single Manager HF
I'm going to be vague on purpose. I'm a quant with 5 years of experience and have been approached by a discretionary fund (about 1-2 yards in AUM, been around for 5 years although the growth really has been in the last 2 years) to start a quant book.
Pros: With quant strategies, smaller places are better since you see the whole pie and can run strategies that aren't capacity restrained at the fund. Seems like a chance to take control of my career, build my own team, and grow into a leadership role.
Cons: This is a new buildout from scratch and I already know their tech is going to be garbage, so I'll have to built it up myself (mid-freq, so nothing too crazy).
My 2 biggest concerns are:
a) can I get along with discretionary folks? Ie: are they going to override my analysis or just using me to market to investors about "analytics"
b) I don't have 10-20 years of experience, so I am worried that I'm cutting my quant career short by not working with other quants ie: places like HRT/Citadel/ETC. If this doesn't work out, then it might be difficult trying to get into a quant fund again?
The reason I think they are approaching me is that an experienced CTA/Stat Arb/HFT PM would be too expensive and they would rather grow this in house. The expectation is to act as a strategist and come up with strategies as a sub-PM under a senior PM before ramping up to be a full time risk taker if things go well.
If anyone else has done this before, I'd love to heard your thoughts. Anything else I should consider when making this decision would be appreciated.
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