Quants: The Alchemists of Wall Street
The documentary offers a great insight into “what a quant is” and the role they play in the global finance markets. The quant’s featured in the documentary were Paul Wilmott, Mike Osinski, Matthew Goldstein and Emanuel Derman. These math geeks were involved in the creation of software programs and complicated algorithms that were involved in a financial crisis. The short film also explores the moral aspects of their job and its impact on society.
BBC Million Dollar Traders
Former Goldman Sachs trader Lex Van Dam risked £1 million of his money to prove it’s possible to take people with no previous trading experience and turn them into a successful city trader. Van Dam enlists the help of old GS buddy Anton Kreil to manage and advise the novice traders. Anton Kreil was an interesting character, (seemed a bit up his own arse) you can checkout some of his videos on Youtube. In total there were 8 traders that came from all walks of life. There’s a shopkeeper, fight promoter, retired engineer, retired army officer, single mother and a student but as the pressure mounted very few make it to the end. The diverse background of the individuals create an interesting dynamic that was both entertaining and at times frustrating to watch (old Simon in particular). The most fascinating insight from the program was the psychological effect it had on some of the participants, some thrived others buckled. It’s important to note that the markets were extremely volatile during filming in 2009.
Due to the success of Million Dollar Traders the BBC financed another trading related program. Its definitely worth a watch but nowhere near as good as MDT. Millions by the Minute is a two-part series, in part one it follows two women Karen Finerman, who runs a $200 million hedge fund and Virginia McGathey a commodity futures broker. Other financial traders interviewed were Scott Redler a prop trader in New York and forex traders Piers Curran + Will De Lucy of Amplify trading.
Part two is more interesting and concentrates on retail traders who trade from home. The scary thing is how new trading technology allows anyone to trade the markets. Some of it is hard to watch especially Jane, the nurse who trades forex on a demo account and Rene a retired antiques dealer that has only broke even after 7 years. Justin and Akil from Birmingham run a hedge fund from a small bedroom. They supposedly manage over £1 million which seems like pure bullshit. Charlie Burton also seems a bit sketchy, claims to be a millionaire from forex trading. It’s more likely he makes the majority of his money selling expensive trading education.
Wall Street Warriors
WSW is a classic that pretty much everyone has seen by this stage. Two of the seasons can be viewed online but for some strange reason season 3 was never released to the public. I wrote a blog post (click here) covering what has happened to some of the characters featured in the series since the show aired. Surprisingly one of them ended up in jail.
Floored: Into the Pit
2 hour film describing how the shift to electronic trading negatively impacted Chicago Floor traders, whose jobs would eventually be replaced by computers. Upcoming young traders who can leverage new trading technology will replace the old pit traders who refuse to adopt. One trader who lost his job during that time, proclaimed that computers were “evil”, now ironically trades (using a computer) for a prop firm. Adrenaline junkie with a passion for hunting, Mike Wash is strongly opposed to e-trading. Former hot-shot Jeff Ansani lost nearly everything on one trade in 1994, now only works as clerk on the floor. Greg Riba was the most entertaining in his two minute cameo and was clearly intoxicated while being interviewed.
The Wall Street Code
Goes into great detail explaining how algorithmic trading and super computers are taking over Wall Street. Former Goldman Sachs quant, Haim Bodek’s high frequency trading company went bust in 2011 due to exchanges not executing his order types correctly. High-frequency trading firms fight over every tick of a stock. They send millions of orders through the exchanges, taking tiny profits but done over an extended period of time, results in substantial gains.