Finance:The Quants

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Short description: 2010 book by Scott Patterson
The Quants
How a New Breed of Math Whizzes Conquered Wall Street and Nearly Destroyed It
The Quants.jpg
Hardcover edition
AuthorScott Patterson
CountryUnited States
LanguageEnglish
SubjectFinance, trading, investing
GenreNon-fiction
PublisherCrown Business
Publication date
February 2, 2010
Media typePrint, e-book
Pages352 pp.
ISBNISBN:0-307-45337-5
Followed byDark Pools 

The Quants is the debut New York Times best selling book by Wall Street journalist Scott Patterson.[1][2] It was released on February 2, 2010 by Crown Business. The book describes the world of quantitative analysis and the various hedge funds that use the technique.[3][4] Two years later, Patterson published a follow-up book, Dark Pools: High Speed Traders, AI Bandits and the Threat to the Global Financial System, an investigative journey into the history of high-frequency trading and the spread of artificial intelligence in today’s markets.[5][6]

Background

Patterson began writing The Quants in 2008. He was first exposed to the quantitative analysis investment strategies while covering the financial industry for the Wall Street Journal.[7] As he became more acquainted with the players involved, he found that many of the most successful quants knew each other and carried similar eccentricities.[7] Realizing this was a world that the average investor knew little of, Patterson wrote the book to shed light on the strategies, players, and related risks of such trading strategies.[7]

Synopsis

The introduction to The Quants describes the real-life, annual, high-stakes poker match between Wall Street's hedge fund managers, comparing their trading styles to their poker strategies.[8] It focuses on, among other things, the 2007 subprime mortgage crisis and how it helped trigger a sudden and massive unwinding of complex, highly leveraged quantitative strategies. The book also delves into critical short-comings of many quantitative strategies, such as their tendency to lead to crowded trades and their underestimation of the likelihood of chaotic, volatile moves in the markets.[9]

The book also delves into the background of the various vanguards of quantitative analysis. It tells the history of Beat the Market & Beat the Dealer author Ed Thorp; Pete Muller from Morgan Stanley's hedge fund; Ken Griffin from Chicago Citadel LLC; James Simons from Renaissance Technologies; Clifford S. Asness and Aaron Brown from AQR Capital Management; and Boaz Weinstein from Deutsche Bank.[10][11]

Reception

The Quants debuted on The New York Times bestseller list.[1] Jon Stewart featured Patterson as a guest on The Daily Show and described the book as "unbelievable."[4] Patterson was a guest on NPR, and Ed Thorp, one of the book's main characters, joined Patterson for a live interview.[10] The New York Times profiled the book, calling it "fascinating and deeply disturbing."[2] The Quants received additional profiles in Bloomberg, BusinessWeek, Scientific American, Financial Times, and Minyanville.[2][3][4][7][8][9][10][11]

See also

References

  1. ↑ 1.0 1.1 "Hardcover Nonfiction Books - Best Sellers - March 7, 2010 - The New York Times" (in en-US). The New York Times. ISSN 0362-4331. https://www.nytimes.com/books/best-sellers/2010/03/07/hardcover-nonfiction/. 
  2. ↑ 2.0 2.1 2.2 Hurt III, Harry (February 20, 2010). "In Practice, Stock Formulas Weren't Perfect". New York Times. https://www.nytimes.com/2010/02/21/business/21shelf.html. 
  3. ↑ 3.0 3.1 Pressley, James (February 18, 2010). "How Quants Made a Killing—and Made a Mess". BusinessWeek. http://www.businessweek.com/magazine/content/10_09/b4168070829612.htm?campaign_id=rss_null. 
  4. ↑ 4.0 4.1 4.2 Stewart, Jon (March 4, 2010). "Scott Patterson". The Daily Show. http://www.thedailyshow.com/watch/thu-march-4-2010/scott-patterson. 
  5. ↑ Cendrowski, Scott (June 22, 2012). "Reasons to fear Wall Street's high-tech traders". CNN Money. Archived from the original on June 25, 2012. https://web.archive.org/web/20120625010314/http://features.blogs.fortune.cnn.com/2012/06/22/dark-pools-scott-patterson/. 
  6. ↑ "High Speed Threats to Global Financial Systems". CNBC. http://video.cnbc.com/gallery/?video=3000095861&play=1. 
  7. ↑ 7.0 7.1 7.2 7.3 Collins, Greg (April 13, 2010). "The Quants: Q&A With Scott Patterson". Minyanville. http://www.minyanville.com/businessmarkets/articles/quants-scott-patterson-fat-tails-todd/4/13/2010/id/27748. 
  8. ↑ 8.0 8.1 Patterson, Scott (September 22, 2011). "How Math Whizzes Helped Sink the Economy"]. Scientific American. http://www.scientificamerican.com/article.cfm?id=quants-book. 
  9. ↑ 9.0 9.1 Sender, Henny (February 11, 2010). "Wall St maths geniuses whose models did not add up". Financial Times. http://www.ft.com/intl/cms/s/0/d0fbfad4-16ad-11df-aa09-00144feab49a.html#axzz223gU2rnb. 
  10. ↑ 10.0 10.1 10.2 "'The Quants': It Pays To Know Your Wall Street Math". NPR. February 1, 2010. https://www.npr.org/templates/story/story.php?storyId=123209339. 
  11. ↑ 11.0 11.1 Pressley, James (February 10, 2010). "Citadel's Griffin Skirts Disaster, Taleb Fumes: Books (Update1)". Bloomberg L.P.. https://www.bloomberg.com/apps/news?pid=newsarchive&sid=aH4r5gwyu_OE. 

External links



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