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Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

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Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#81

Post by in3d »

Nursie wrote: post #52
keyle wrote: post #9

Earlier quoted context omitted.

I take the silver lining. Smart people getting rich is better than dumb people getting rich. Hopefully some day they'll do something good with that money.

I’m not sure that’s true either. See for example “effective altruism”, which turns out to have been neither, but more of a self-deluded justification for insane greed, coupled with a god complex.

Ridiculous, uninformed comment. There is no question that Effective Altruism has done tremendous good overall by saving many, many lives. I say this as someone who disagrees with important aspects, such as valuing distant lives equally to local ones. They have also been more correct than anyone else about AI, pandemics, etc.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#82

Post by lysecret »

bblcla wrote: post #16
Workaccount2 wrote: post #4

I will eternally find it sad how much talent is wasted on trading. So much money, so much intelligence, so much time and effort, all the provide almost no tangible value to society.

Tyler Cowen did an 'ask me anything' at Jane Street when I interned in 2016. One of the interns asked him exactly this: "What do you think of the fact that we all work here instead of, I don't know, curing cancer?" He replied with, roughly, "Those of you who work here probably couldn't do anything else other than perhaps math research. Arguably, working here is the economically efficient use of your time." I think ab…

Do you have a link to this talk by any chance?

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#83

Post by TheAlchemist »

Workaccount2 wrote: post #75
twoodfin wrote: post #13

Earlier quoted context omitted.

If it didn’t provide value, nobody would pay for it. The alternative to highly technical, agile quantitative trading is fat middle men, wide spreads, and capital sitting in 8%* stupider places than it would otherwise. That’s a pretty big deal even if the observable effects are extremely diffuse. * Made up number, but if we woke up on Monday with nothing but the tech we used to trade in 1984 it would probably hit much…

My actual gripe is with where that value comes from, and what it's true cost to society is. I'd argue that pulling these people out of moving society forward is just another form of externalized cost. The stanford guy who figured out how to halve the cost of solar in 2012 never got to realize it because $750k/yr to do stochastic modeling of cattle feed to (secretly) overcharge farmers for futures contracts was just t…

The way I see HFT, is that previously this money was going to brokers and banks.

Now, most of this money is going to HFT shops, but you could also make an argument that some of it stays with the investors, since spreads are much smaller now.

There is 0 cost to society, maybe even a small gain.

As for moving society forward, I don't know. If not in finance, most of these guys would work for big tech companies trying to actively make kids and adults addicted to screens.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#84

Post by logicchains »

Workaccount2 wrote: post #4

I will eternally find it sad how much talent is wasted on trading. So much money, so much intelligence, so much time and effort, all the provide almost no tangible value to society.

Please share what industry you work in? And if it's social media/ad tech or military, get off your high horse you smug hypocrite.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#85

Post by MichaelRo »

madars wrote: post #31
Workaccount2 wrote: post #4

I will eternally find it sad how much talent is wasted on trading. So much money, so much intelligence, so much time and effort, all the provide almost no tangible value to society.

Why would it be wasted? I like apples and I like being able to buy them any day of year, even out of season. The only reason I can do so is because there is an entire industry of people who manage the inventory, distribution, try to predict supply and demand, and take on a risk doing that. The principal reason why I can buy and sell equities at very small spreads any day of the year is similar: traders are competing…

It's fun to see how every time a finance topic pops up, discussion steers towards lamenting on how "talent is wasted" by doing this and not that.

See, if you're a fishmonger and someone comes to you and say "why don't you trade flowers instead", you ignore them because they are not your customer. They won't trade fish with you, and in fact they wouldn't trade flowers either. They're just useless relative to your trade and only yapping so just turn your back on them and leave them be. Tell them to fuck off and find a flower monger if they really want it or mong those those flowers themselves because you are sticking to monging fish.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#86

Post by edanm »

__mharrison__ wrote: post #25

I read this and think: "I would love to spend a day with Jane Street and teach them how to use notebooks." So much effort is wasted because of knowledge gaps or systems that don't encourage best practices. I just taught a course to a client this week helping them with this (and other best practices for Python).

I'm intrigued - I didn't listen to the post but wonder what kind of best practices you're talking about.

Do you have this written down anywhere or on video anywhere? I'd love to learn more about what you mean.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#87

Post by ackbar03 »

bblcla wrote: post #16
Workaccount2 wrote: post #4

I will eternally find it sad how much talent is wasted on trading. So much money, so much intelligence, so much time and effort, all the provide almost no tangible value to society.

Tyler Cowen did an 'ask me anything' at Jane Street when I interned in 2016. One of the interns asked him exactly this: "What do you think of the fact that we all work here instead of, I don't know, curing cancer?" He replied with, roughly, "Those of you who work here probably couldn't do anything else other than perhaps math research. Arguably, working here is the economically efficient use of your time." I think ab…

Oof. Interesting take.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#88

Post by bblcla »

lysecret wrote: post #82
bblcla wrote: post #16

Earlier quoted context omitted.

Tyler Cowen did an 'ask me anything' at Jane Street when I interned in 2016. One of the interns asked him exactly this: "What do you think of the fact that we all work here instead of, I don't know, curing cancer?" He replied with, roughly, "Those of you who work here probably couldn't do anything else other than perhaps math research. Arguably, working here is the economically efficient use of your time." I think ab…

Do you have a link to this talk by any chance?

Unfortunately, no. It was a private talk.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#89

Post by Grimblewald »

bblcla wrote: post #16
Workaccount2 wrote: post #4

I will eternally find it sad how much talent is wasted on trading. So much money, so much intelligence, so much time and effort, all the provide almost no tangible value to society.

Tyler Cowen did an 'ask me anything' at Jane Street when I interned in 2016. One of the interns asked him exactly this: "What do you think of the fact that we all work here instead of, I don't know, curing cancer?" He replied with, roughly, "Those of you who work here probably couldn't do anything else other than perhaps math research. Arguably, working here is the economically efficient use of your time." I think ab…

To build on / extend on this - quants / finance folks need to cultivate an image of only taking the very brightest, to justify the shit working conditions (even if pay is often decent) but honestly the brightest tend not to apply. Working in those environments is neither rewarding nor stimulating.

Re: Finding Signal in the Noise: Machine Learning and the Markets (Jane Street)

#90

Post by bob1029 »

czhu12 wrote: post #2

Been following signals and threads for a while, and it’s amazing. Have to be in a learning mood, but it gets pretty technical. Podcasts are a tough medium to do that in but if you really zone in, signals and threads is fantastic

This one and Machine Learning Street Talk are my two favorites at the moment.
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