It’s April 2005 and your name is Brian Hunter. You are 31 years old and Steven Cohen has just offered you $1 million to join SAC Capital Advisors.
Do you take it?
Nope. You just turned down $1 million. Sorry. After a fair amount of convincing and an offer to run his own book, Amaranth was where Brian Hunter chose to stay. He was on top of the world.
Fast forward 17 months. Top of the world? Hardly. Brian Hunter’s natural gas trades have gone horribly wrong. During the month of September 2007, Amaranth reportedly lost $6.6 billion. Failed trades needed to be unwound as investors pulled their money from the hedge fund causing a death spiral. Brian Hunter and Amaranth were finished.
Making millions or losing billions – such is the life of a Wall Street trader.
[continue reading…]
It’s that time of year again – the Institutional Investor (II) vote that ranks sell side research analysts. I know because my inbox is flooded with “Please vote for us” requests.
Asking me to vote for you is not going to impact my vote, but I understand the desire of sell side analysts to ask for votes. For buy side analysts and portfolio managers, success is easily measured since it is all about investment performance (see: Alpha, Baby). It’s black-and-white: either you performed or you did not.
For sell side analysts and associates, measuring performance is not nearly as black-and-white. Sell side analysts provide general research and make general recommendations so there is no benchmark to compare them against. Instead, the II vote takes precedence.
[continue reading…]
It’s April 2005 and your name is Brian Hunter. You are 31 years old and Steven Cohen has just offered you $1 million to join SAC Capital Advisors.
