Who is making money at MM in 2020
With most MM platforms handily outperforming the market and other HFS posting double digit returns in 1H 2020, I’m curious where the bulk of the profits are coming from.
There was an FT article that reported that Citadel Global Equities (their original stock picking unit) was down 6% YTD and their Fixed Income unit up 9% YTD. Other chatter is that quant generally has been a laggard so far this year at MM.
Anyone please share if you know sub strategy level performance. From the sound of it majority of profits have been coming from stock picking units
Everyone who made it through March. Dumb math on Mlp is 800mm comp pool, 200 teams, 4mm average comp six months in.
Dont know how you deduct that equities are driving gains, when the only concrete datapoint you offer is that CGE has sucked.
As far as I know, fixed income has crushed it at most shops.
60 -75% FICC thanks JP. But you have to ask why baly is so high
Does that mean fixed income recovered completely from the lows in March and became a strong net positive at most shops? That’s interesting because I heard LMR is still down YTD and they are mostly fixed income - but could be because they took gross down before the fed saved the day
Apparently Baly is driven by mostly consumer and healthcare. Last I heard their macro hasn’t been doing well and the head of macro in London left
LMR is a special case. I know they shut down a smaller fund, was not aware everything is down.
LMR basically only does futures basis which blew up in March. If they are down, they were too big and stopped out on risk. Those who were too levered are in trouble, those who could hold on are alright, and anyone who could add is killing it - Citadel FI lost like 400mm on like 3bn AUM in March but raised 1bn quickly for long end basis at the depths, so that bailed them out. Draghis son works at LMR so conspiracy theory that they are doing poorly with the madame.
Fair point - I thought that the majority of risk was deployed to equities (70% or more). Certainly that’s the case at P72 and BAM. Thought it was true at Citadel as well. Not sure about MLP
Wasn’t sure if huge years in FICC could actually drive 10+% first half returns
If anything it’s a tougher year in equities in MM world, but in aggregate most MMs at master fund level are doing well / OK, especially Citadel, Baly and (as always) MLP.
Any colour on quant groups?
bump
word is that cubist has mostly recovered their losses.
Really? Think word is wrong.
well, this is from someone who works at cubist. So unless they're gaslighting....
I think it depends on what exactly "recovered" means. Like are they positive YTD yet? I know teams were still getting cut in May. Quant equity performance was generally lacking in Jun as well, so I would be surprised if they have recovered.
How do you think about what environments are good for quant equity? What has been the problem? Retail as marginal price setters?
I've heard this as well from sources and that they are on track for a good year. Tbh seems completely inconsistent with their head leaving, march performance numbers, overall p72 performance numbers, and the fact that multiple teams were cut but who knows.
How was July for everyone?
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