Saturday, July 28, 2007

Trading Floor

I am straddling two positions at the moment. I am still at my current position as SVP of Equity Derivatives at my company, but I am also doing a slow transition to the Derivatives Analytics desk on the business side. So, for the latter role, I have been sitting on the massive Equities trading floor at my company.

The contract in the physical difference in the two roles is stark. In my position in Architecture, I sit in a big office in an old Lucent campus in the middle of North/Central New Jersey, about 35 miles from Allentown, Pa. The place is almost like a morgue ... I could go there, sit in my office, and not see anyone for an entire day.

On the other hand, the trading floor is located in the middle of very hip Tribeca. This is not your father's Tribeca. You have 20 gourmet restaurants within two blocks of my office. You can look out the 20-foot windows that overlook the Hudson River and see the Statue of Liberty. You can see pretty girls walking across the floor all day long.

When I am sitting at the Derivatives Analytics quant desk, there is the amazing energy that accompanies a trading floor. I was lucky enough to be on the floor for these last two trading days, where the Dow dropped 500 points. There was cheering, shouting, tension, madness. It reminded me of the old days, when I started out on Wall Street as a consultant for Goldman Sachs, and then went to consult for Drexel Burnham. In those days, we developing the first cut of Windows-based trading workstations, so we would always get traders who looked over our shoulders, commenting on our work.

It has been no secret that I am fascinated with the quant world. I am sitting with truly brilliant people who talk a different language that I barely understand. Even though the quants at my desk are 50% Russian, they talk in English, throwing around terms like Kurtosis and Skew Risk, terms which have me madly scrambling to Google. Terms which may me wish that I had not shown up drunk to Statistics 101 class every day in college!

It is interesting to have these quants coming up to me, apologizing for their code. Maybe I can teach them a little bit about software and architecture, and they can teach me how to Delta Hedge my portfolios!

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