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Understanding Jane Street

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Re: Understanding Jane Street

#351

Post by lhnz »

badpun wrote: post #340
benreesman wrote: post #170

Earlier quoted context omitted.

You're curious about how people would choose between two equally interesting jobs where one pays a lot more? I'm curious about how anyone could be curious about that.

I mean stuff is either interesting for someone or it's not. Money is not relevant to being interested by something. I think people want to convince themselves that they're interested in high paying jobs such as those at Jane Street because that would make their lifes much easier (they could go work there and make lots of money). Similarly, some women try to convince themselves that they love this well-off, solid guy…

There's nothing wrong with pursuing money.

Re: Understanding Jane Street

#352

Post by gcapell »

dash2 wrote: post #260
pvitz wrote: post #183

Earlier quoted context omitted.

I would also suggest to forget about Hull and Wilmott and would suggest to start with the excellent book by Shreve: "Stochastic Calculus for Finance. Volume II: Continuous Time Models". Then, you can quickly read Bjoerk, work through Brigo/Mercurio (if you like that style) or Andersen/Piterbarg. Alternatively, if you want to fully dive into into the subject after Shreve, Musiela/Rutkowski: "Martingale Methods in Fina…

I'd say that Shreve and Musiela lack rigour and are too focused on trivia, name-dropping and anecdotes. Jiao's "Infinite-dimensional methods in amassing vast bags of gold" is unsurpassed. For its coverage of Black-Scholes, I'd also recommend Schulz's "Good Grief, Charlie Brown". Sorry, everyone seemed to be doing this so I felt I should contribute too.

I honestly can't tell exactly when the thread meandered into satire.

Re: Understanding Jane Street

#353

Post by uniqueuid »

adamsmith143 wrote: post #303
uniqueuid wrote: post #191

Earlier quoted context omitted.

I can't judge that from an outside perspective, but to be fair, having nothing to show for two decades of work is an intrinsic occupational risk of science.

> I can't judge that from an outside perspective, but to be fair, having nothing to show for two decades of work is an intrinsic occupational risk of science. How? In today's academic environment you won't survive even a few years without publishable research results.

Oh you can publish innumerable things whose content is nothing to show for, yet you publish something :)

Re: Understanding Jane Street

#354

Post by flerovium »

This is wrong.

The 100 poker-chips interview thing = interview BEFORE internship.

As you would expect, a job offer is based on full internship performance.

I don't have personal experience but I have friends who interviewed there.

Re: Understanding Jane Street

#355

Post by robertlagrant »

badpun wrote: post #340
benreesman wrote: post #170

Earlier quoted context omitted.

You're curious about how people would choose between two equally interesting jobs where one pays a lot more? I'm curious about how anyone could be curious about that.

I mean stuff is either interesting for someone or it's not. Money is not relevant to being interested by something. I think people want to convince themselves that they're interested in high paying jobs such as those at Jane Street because that would make their lifes much easier (they could go work there and make lots of money). Similarly, some women try to convince themselves that they love this well-off, solid guy…

Money does make some things easier. People make job choices based on:

- lifestyle - how much does this job affect my work/life balance? Do I have to travel far / work late?

- challenge - how hard is it? Will I enjoy the work?

- impact - what's the mission of the company? What am I contributing to?

- salary - how does the job fit with my financial goals?

- prestige - can I talk about / be celebrated for what I do?

Possibly other factors as well. But if everything is equal, but one job pays more than another (and if it's Jane Street, one year's work might be 3 years' work somewhere else) then it makes sense to take it.

Re: Understanding Jane Street

#356

Post by kenned3 »

matred wrote: post #321
adamsmith143 wrote: post #302

Earlier quoted context omitted.

>Taleb He already had a PhD so it's not surprising he was able to enter Academia. But outside his books I'm not aware of anyone talking about his Research much.

I’ve never see his research brought up amongst quants or traders, but I like his writing. Does anyone who works in this field know of it being currently applied?

I spent most of my career in finance including a hedge fund and several international banks.

Personally I really enjoy his books and recommend them to my friends and family. Professionally, I have never heard his name being mentioned.

You find the same 'fluffy' management books on trader desks (varies between firms).

- Some translation of "the art of war". - Tribal leadership and their whole "Tribe of tribes" nonsense - its name escapes me at the moment, but some leadership book written by a US marine? Because this maps directly to finance? - six sigma

Usually they are "management" focused chanting type material.

Re: Understanding Jane Street

#357

Post by david_allison »

wahnfrieden wrote: post #275
david_allison wrote: post #179

Earlier quoted context omitted.

In my experience, retention in quant finance is much higher than in tech (barring a few firms) People don't leave.

a high wage is a kind of golden handcuff

I don't feel it's primarily about the money (but it helps). If it was about the money, it'd be the uncertainty of the bonus, rather than the wage itself.

Re: Understanding Jane Street

#358

Post by vecter »

wheelinsupial wrote: post #335
vecter wrote: post #54

Earlier quoted context omitted.

I worked in High Frequency Trading over a decade ago (not Jane Street) so I have some insight into this. In general, markets are always evolving. I've seen a team of four traders that make $500k/day go down to $0/day over the course of 6 months. So you're actually right more than you think. Plenty of teams that make money do stop making money over time (or make less). I'm sure there were teams at Jane Street over the…

> They probably ate most of the former team's lunch. Are you able to elaborate on this? I’m assuming that teams wouldn’t be sharing strategies with other teams. Is that accurate? Would these other teams be independently finding some strategy that is either directly better than another internal team or is having some indirect impacts on other teams?

> I’m assuming that teams wouldn’t be sharing strategies with other teams. Is that accurate?

Correct. At least at this firm I was at (different firms have different org setups and therefore incentive structures), each team was a silo. All the teams shared the common core infrastructure to talk to exchanges, but that was it.

Teams have negative incentives to help each other.

> Would these other teams be independently finding some strategy that is either directly better than another internal team or is having some indirect impacts on other teams?

Exactly. You have no idea who you're trading with. It could be against other teams in the company or other players in the market (probably a mix of both).

Re: Understanding Jane Street

#359

Post by quickthrower2 »

paulpauper wrote: post #325
nly wrote: post #154

Earlier quoted context omitted.

One of the funds you list is leveraged 3x. If the market drops 33% you're wiped out, get liquidated, and can never recover. You've already made the assumption that you can detect the market bottom to select when to drop the $3K, which is ludicrous, and begs the question if you're know where the bottom is why not put the full $10K in then with maximum upward leverage.

that would require a 33% decline in a single day for the Nasdaq, which has never happened in the history of the stock market.

I think your strategy is making the fallacy that past performance is a guarantee of future performance. Using specifically picked events (e.g. 33% decline) and then assuming that the event not happening in the past makes it impossible to happen in the future.

Also how does TQQQ work. I don't know and I am happy to admit that. But I assume they need to do re-balancing shenanigans to keep the leverage at 3x, they have to pay interest on the leveraged money, and so on. So it is possible that the market takes a milder dip than 33% but you get stung on TQQQ - maybe not a wipeout but severely down and takes years to get back to break-even. Would like to hear from someone with knowledge of this.

If you have a long term alpha strategy - one that can beat the market every time - and it is as simple as buying an off the shelf instrument and topping it up. I would be surprised.

Re: Understanding Jane Street

#360

Post by benreesman »

badpun wrote: post #340
benreesman wrote: post #170

Earlier quoted context omitted.

You're curious about how people would choose between two equally interesting jobs where one pays a lot more? I'm curious about how anyone could be curious about that.

I mean stuff is either interesting for someone or it's not. Money is not relevant to being interested by something. I think people want to convince themselves that they're interested in high paying jobs such as those at Jane Street because that would make their lifes much easier (they could go work there and make lots of money). Similarly, some women try to convince themselves that they love this well-off, solid guy…

I went through a relatively brief conspicuous consumption phase in my youth, but most of the people around me actually didn’t.

What money bought them, and why I now want more than I have, is the ability to delegate both tasks, but even more importantly worry, to others. If I have a brand-new car with a warranty, I spend zero worry that it’s going to break down. If I have a hot shit CPA and/or lawyers and stuff, I spend zero worry than I’m going to dick up my taxes or something. If I have a rhodium-plated health plan, I don’t worry (much) about getting sick. Ditto fitness trainer, ditto housekeeping service, ditto laundry service.

What this really buys a passionate hacker (really a passionate anything) is time unencumbered by stress, which is very different to just time. I can really focus on whatever I want to.

Usually this means I have to work hard and stress about technical stuff, but I far prefer, borderline like, being wrapped around the axle on technical stuff. I hate worrying about that other stuff.

How anyone could fail to consider this a reasonable tradeoff is beyond me.

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