WorldQuant

Last updated

WorldQuant
Company type Private
Industry Investment management
Genre Hedge fund
Founded2007;17 years ago (2007) in New York City, US
Founder Igor Tulchinsky
Headquarters
Old Greenwich, Connecticut, US
Number of locations
24 offices [1]  (2020)
Key people
  • Igor Tulchinsky
    (Chairman, CEO and Co-CIO)
  • Richard Hu
    (Vice chairman and CRO)
  • Paul Griffin
    (Co-CIO and CSO)
  • Jeffrey Blomberg
    (CAO and General Counsel)
  • Jonathan Marom
    (CFO)
  • David Rukshin
    (CTO) [2]
Services Quantitative trading and investing
AUM US$9 billion [3]
OwnerIgor Tulchinsky
Number of employees
1,000 [4]  (2023)
Website WorldQuant.com WorldQuant.co

WorldQuant, LLC is an international hedge fund and quantitative investment management firm [5] [6] [7] headquartered in Old Greenwich, Connecticut. [8] Founded in 2007, the firm is currently managing approximately $9 billion in assets under management [3] for Millennium Management [8] via quantitative trading and other methods of quantitative investing. [9] WorldQuant operated the WorldQuant Challenge, where participants compete in the field of quantitative finance, [10] and WorldQuant Accelerator, an independent portfolio manager platform. [11] In 2015 the WorldQuant Foundation launched WorldQuant University. [12]

Contents

History

Millennium spinoff

WorldQuant, LLC was founded in 2007 [13] [5] as a quantitative investment management firm spun out of Millennium Management [14] in New York City. [9] Prior to forming WorldQuant, its Belarus-born [15] founder Igor Tulchinsky (* 1966 [16] ) had worked at Millennium as a portfolio manager since 1995. With a focus on statistical arbitrage, [8] [17] Tulchinsky's team of researchers and quantitative traders [18] joined him at WorldQuant. The new fund continued to use Millennium's corporate infrastructure and trading platform. [9]

Early history and recent developments

By 2014, WorldQuant had officially launched the WorldQuant Challenge, with around 30,000 people taking part by May 2016. The year-round competition allowed contestants to use WorldQuant's WebSim platform, an online "financial market simulation tool", to create their own algorithms, or "Alphas", in an effort to predict behavior in the stock market. [13] The challenge resulted in 7,000 active users on the WebSim platform by March 2017, with 450 of those users hired as part-time research consultants [7] through WorldQuant's Research Consultant program. [13]

By April 2015, WorldQuant had 400 employees responsible for managing $4 billion of Millennium's funds, equating to approximately 15% of Millennium's total AUM. WorldQuant's business model continued to rely on data analysis to predict stock market behavior, with researchers analyzing "thousands of data sets to create so-called trading signals." Explains the Wall Street Journal, "A separate team focused on portfolio construction and management sorts through and combines [the trading signals], turning them into models. Many such models, which [are] continuously adjusted, [make] up a fund." [9] By May 2016, WorldQuant had 18 offices with 450 professionals working as researchers, portfolio managers, and technologists. [13]

In February 2017 WorldQuant announced the launch of WorldQuant Accelerator, an independent portfolio manager platform to compete with other open source trading platforms, mainly Numerai, Crunchdao, QuantConnect & Quantopian. [11] At the time of its launch the new platform had 15 independent teams, [8] with plans outlined to double that number over the next two years. The new platform allowed WorldQuant's independent portfolio managers to access WorldQuant technology such as back-testing technologies and impact modeling. [11] The platform also allowed managers to retain the rights to their algorithms, a detail that Bloomberg said was "rare in the industry" and "could help WorldQuant compete for the top minds." [8] The platform is no longer active.

By April 2017, WorldQuant managed more than $5 billion [5] for Millennium Management. [10] Although WorldQuant has never published performance numbers publicly, the Wall Street Journal reported in 2017 that the firm had "never had a down year." [5]

In 2022 WorldQuant initiated Global Alphathon, an international competition where quants build and submit alphas using WorldQuant’s BRAIN platform. [19]

Offices and employees

With headquarters in Old Greenwich, Connecticut, [8] WorldQuant has more than 20 offices worldwide. [1] [11]

By April 2017 WorldQuant had more than 500 employees, as well as 450 paid research consultants. 125 full-time employees were [5] "PhDs scouring everywhere for recurring patterns that might boost returns," [7] working as researchers or in other positions. [5] The year prior, WorldQuant had settled out of court on a breach of contract suit concerning a former head of its data strategies. [10] [18] By November 2018, the company had 700 employees. [20]

In May 2020, Gary Chropuvka was appointed as president by WorldQuant. [21]

Services and business model

WorldQuant LLC is a hedge fund [18] and a quantitative investment management firm, providing related services such as portfolio management, market research, and trading. [22] Described by the Wall Street Journal as "part of the forefront of a new quantitative renaissance in investing", [5] the firm has a "computational" approach to its quantitative trading that utilizes "data mining, statistical methods and artificial intelligence". [18] Deep learning and artificial intelligence are used as tools to help with small-scale trading. [23]

According to Bloomberg on March 16, 2017, "WorldQuant claims to look at thousands of new information sources a year, no matter how exotic. From those, it's built a library of 4 million 'alphas', or pieces of predictive code that tell the computer to buy or sell. Some may be simple, others may be attempts to take advantage of market anomalies. Portfolio managers then construct strategies by using the alphas as building blocks, depending on which the current market environment favors, swapping out ones that may have lost their edge." [7]

By April 2017 the company had analyzed new data sets, including items varying from shipping statistics to credit card receipts to parking lot traffic to market pricing data, creating and compiling 4 million alphas in a central repository [5] [7] called the "Alpha Factory". WorldQuant's online platform called WebSim allows its paid consultants to add algorithms to the repository. Other divisions within WorldQuant then combine the alphas into strategies, which are then turned "into bigger portfolios", largely related to stocks. [5]

WorldQuant University

In 2015 the WorldQuant Foundation launched WorldQuant University, a free online master's degree program in financial engineering. [24] [12]

WorldQuant Ventures

In late 2014 Tulchinsky [9] founded WorldQuant Ventures. [25] [26] Organized separately from WorldQuant [17] as Tulchinsky's own angel investment fund, the firm's focus is on data and finance companies [25] in "everything from artificial intelligence to water management." [17] 2016 investments included Cycle Computing, [25] Benzinga, [17] and untapt, [27] while 2017 investments included the Canadian research company Canalyst. [28] In December 2021 WorldQuant Ventures invested in AngelList's Early Stage Quant Fund. [29]

See also

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References

  1. 1 2 "Contact". WorldQuant. Retrieved August 3, 2023.
  2. ↑ "Who We Are / Leadership". WorldQuant. 2020.
  3. 1 2 "WorldQuant enjoying banner year despite $200m vaccine shake-up hit", Financial Times, November 19, 2020
  4. ↑ About - How We Work, WorldQuant, 2023
  5. 1 2 3 4 5 6 7 8 9 Hope, Bradley (April 13, 2017). "With 125 Ph.D.s in 15 Countries, a Quant 'Alpha Factory' Hunts for Investing Edge". Wall Street Journal . New York City, New York, United States. Retrieved October 29, 2017.
  6. ↑ Porzecanski, Katia; Kumar, Nishant (March 6, 2017). "How a $26 Billion Hedge Fund Lures the Beautiful Minds". Bloomberg . United States. Retrieved October 29, 2017.
  7. 1 2 3 4 5 Burger, Dani (March 16, 2017). "WorldQuant's Part-Time Virtual Army Do Battle for Jobs". Bloomberg . United States. Retrieved October 29, 2017.
  8. 1 2 3 4 5 6 Porzecanski, Katia (February 14, 2017). "WorldQuant Lures Talent With Intellectual Property". Bloomberg . United States. Retrieved October 29, 2017.
  9. 1 2 3 4 5 Chung, Juliet (April 26, 2015). "Millennium Hedge Fund, Quant Trader Plan Venture". Wall Street Journal . New York City, New York, United States. Retrieved October 31, 2017.
  10. 1 2 3 Wigglesworth, Robin (March 8, 2017). "Hedge funds adopt novel methods to hunt down new tech talent". Financial Times . United Kingdom. Retrieved October 29, 2017.
  11. 1 2 3 4 Bennett, Macaela J (February 15, 2017). "Greenwich investment firm launches portfolio manager platform". Greenwich Time . Greenwich, Connecticut, United States. Retrieved October 29, 2017.
  12. 1 2 Milken, Michael; Tulchinsky, Igor (April 11, 2017). "How Technology Liberates Human Capital". Wall Street Journal . Retrieved November 12, 2017.
  13. 1 2 3 4 "Talent Is Global; Trading Can Be Taught". MIT Technology Review . May 17, 2016. Retrieved November 13, 2017.
  14. ↑ "Correction: WorldQuant". Financial Times . United Kingdom. March 9, 2017. Retrieved October 29, 2017.
  15. ↑ Martin B. Cassidy (December 19, 2016). "Chabad Lubavitch unveils new learning center". The Advocate . Tulchinsky, who immigrated to the United States in 1977 from Belarus and lives in Greenwich, said he has been receiving instruction in the Torah from Rabbi Yossi Deren for the past five or six years, which has had a "positive effect" on his life.
  16. ↑ "Minsker Hits Bloomberg's Top 50 People Who Changed The World In 2017". BelarusFeed. December 4, 2017. Retrieved January 23, 2021.
  17. 1 2 3 4 Kishan, Saije (September 29, 2016). "Tulchinsky's WorldQuant Ventures Buys Stake In Benzinga". Bloomberg . Retrieved November 12, 2017.
  18. 1 2 3 4 Vardi, Nathan (December 16, 2016). "Billionaire Dan Loeb's Quant Trading Effort Sparked Legal Battle Over 32-Year-Old Data Scientist". Forbes . Retrieved October 29, 2017.
  19. ↑ Velati, Alyson. "This $7 billion hedge fund is launching a competition for wannabe Wall Street quants. Winning could get them a job for real". Business Insider.
  20. ↑ About - Who We Are, WorldQuant, 2020
  21. ↑ "WorldQuant appoints President". hedgeweek. May 20, 2020. Retrieved September 21, 2020.
  22. ↑ "WorldQuant LLC - Company Profile and News", Bloomberg.com, retrieved August 10, 2020
  23. ↑ Kishan, Saijel (March 27, 2017). "Hedge Funds Are Training Their Computers to Think Like You". Bloomberg . Retrieved November 13, 2017.
  24. ↑ Chaparro, Frank (May 19, 2017). "A hedge fund manager is supporting a free master's program in financial engineering". Business Insider . Retrieved November 12, 2017.
  25. 1 2 3 Darrow, Barb (June 13, 2016). "Cycle Computing Nets Investment to Boost High-Performance Computing". Fortune . Retrieved November 12, 2017.
  26. ↑ Crowe, Portia (April 27, 2015). "One of the most mysterious hedge fund managers in the world is launching his first joint venture with a star trader". Business Insider . Retrieved November 12, 2017.
  27. ↑ Bennett, Macaela J. (November 15, 2016). "WorldQuant Ventures invests in hiring platform". Greenwich Time . Retrieved November 12, 2017.
  28. ↑ Griffith, Erin (June 9, 2017). "Term Sheet — Friday, June 9". Fortune . Retrieved November 12, 2017.
  29. ↑ Mascarenhas, Natasha (December 22, 2021). "AngelList just closed a $25M fund to back startups based on hiring velocity". TechCrunch. Retrieved November 21, 2022.
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