Technology and trading have always gone hand in hand. You think trading – you think technology. In fact, it’s technology that has allowed us to become the most efficient and admired market place in the world. However, that being said, our markets are not without their share of flaws and these glitches have paved the way for a new breed of financial piracy. As we’ve witnessed first hand, we’ve got super computers that are capable of absolutely crushing the Dow Jones in just minutes, high frequency trading that has the ability to out think and run ahead of algorithms, and now… from the shadows, allow me to introduce the most mysterious new player of all… he is covered by just about every broker dealer on the Street and goes by many different names within the trading community, but he is most commonly known as… the “Quant Guy” Who is this guy? Where did he come from? What’s his story?
Up until recently, very little has been known about the elusive Quant Guy. It was assumed that he was half-man, half-machine and far more technologically advanced than any proprietary trading platform known to exist.
Everybody wants to know more about this guy. Did MIT send him from the future? Is he from an entirely different world all-together? What we do know is that he’s like a ghost, he just pops up and rings the light when you least expect it. Actually, it’s usually it’s when you’re really involved in a name and you’ve either taken it or pressed it to the point were it’s ready to snap back and then as if by magic this enigma projects through his sales trader and bids twenty cents below where the street can’t get enough and ten cents below its 52-week low. How does he do it?
Ironically enough, technologically speaking, this guy has “the edge” and we’re expected to deal with him as if he has a handicap. It’s nuts. Let’s say I’m buying stock nice and easy for my customer and in comes you know who… The light rings…. Quant Guy’s sales trader yells over with a straight face that he’ll sell me stock up a nickel from where it’s trading in size. I’m thinking why would I do that. The Quant Guy must have a small bladder and drink too much water because he’s always in a hurry and needs to know right there on the wire.
It’s always the same: Before I can say “fuck off”, the position trader stands up and says, “Can I cross them?” Why would I want to do that when I can by 3x the amount he’s offering me in-line? Then they both stare at me with puppy-dog eyes and say, “Yeah but it’s the Quant Guy”, like he’s some kind of paraplegic who can’t help himself. Oh I’m sorry I didn’t realize it was the Quant Guy – it’s only money. Just clear out the top of book, cross my stock and let it come raining back in – my client won’t mind. I’ll just tell him it was the Quant Guy. He’ll understand.
The worst is when you’re expected to make the call. Both trader and sales trader just stare at you as if to say, “Well, are you going to make the call or what?” Fine. You know what – just in case my customer’s system crashed or he forgot how to read the tape, let me ignore my better judgement and get him on the horn. You never know, he may be tired of having the stock come his way and be excited about paying up for it. Worst case scenario he gets pissed off and I’ll just tell him it’s a quant guy. How could he not buy them..? Poor little quant guy.
Good luck with that call. The Quant guy isn’t somebody to trade with (Not if you value your relationships). He is to be used like news headlines and technical analysis. You don’t call a good client and bid him down when the stock is getting ready to rip in your face, you say “Hey, just and FYI – Quant Guys are sniffing around down here – you may want to take a breather”.
See what other customers have to say:
“Who is this visionary that’s willing to short me stock at a new untouched high when the markets coming off and I’m seeing multiple sellers?” – Dan W, Kansas
“I’d love to trade a big block after 4:00 ahead of earnings but since the markets closed, I generally wait till the next day like the rest of Wall Street” – G. Gorman
“I try not lose my temper when my monkey-see, monkey-do coverage continues to bid me in the hole and offer me stock at a premium when I know it’s for the ‘Quant Guy’… I mean why should the rules or market parameters apply to that guy..?” – Troy F, Chicago
“What was the question again?” – J. Worstburger
Take it and bid it,
Dopey
