Macro economist PMs
I understand this may be a silly question to those of you in the field, so please bear with me. From what I understand there are two main camps of macro PMs. One type comes from a trading background, understands how all the products work, and is very good at putting on asymmetric bets using option structures. The other type hails from a more academic background, probably has a PhD, went to work as an economist at a think tank or central bank, and then somehow ended up money management, where they put on trades based on a longer term economic view rather than playing one data print to the next.
For those of you who have more insight into this - is either breed of PM generally more successful? And second, what firms would employ the economist type of PM? Seems like a lot of the famous ones you hear about take on traders as PMs, but I haven't heard much about where the economist types can go to have a shot at managing money. Thanks all.
While they both place an emphasis on complex trading strategies, several people I know of at both Argonaut Capital and Trigon Investment Advisors would fall into your more "academic" bucket. http://www.hedgetracker.com/fund/Argonaut-Capital-Management http://www.hedgetracker.com/fund/Trigon-Investment-Advisors-LLC
Academic types generally suck. They're typically employed by asset hoarders who use their "pedigree" to help with marketing efforts.
This was my (unsupported) assumption as well...but I recently read about some guys who seemed fairly academic (granted, with a sell side macro economist/strategist background) either getting hired into or spinning out of one of the big name macro shops, whose name escapes me. It was the only case I'd ever heard of, which made me think how rare it actually is to hear about academic types running money.
And about Argonaut - heard about them but thought they had been struggling in recent years?
Everyone, regardless of background, almost uniformly suck at trading...
There are way more than 2 ways to skin a cat. But at the end of the day risk management skills are what separate the wheat from the chaff. (I could keep throwing the cliches and canned sayings at you but I think that's actually a decent response).
I have seen successful PMs from all different types of backgrounds including the ones you mention above. In my experience, the academic types often have risk management issues because they come from academia and so their ego is more tied up in being seen as intelligent then it should be.
Can I infer from this that one is less likely to find academic/economist types (or that they're less likely to be successful) at a multi-manager fund, given the tight risk limits?
@"mbavsmfin" wasn't Argonaut running a few billion at some point? If they're down to 250m that is a huge drop.
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