Key Insights & Takeaways from QuantMinds 2023

QuantMinds, as always, was an excellent chance for some of the very best in the industry to discuss the latest advancements. Machine learning, volatility, portfolio optimization and more were discussed at length.

I think it was a trickier year than expected for the majority of investment banks. What happened to big players such as Credit Suisse earlier in the year had a large shock effect on the market. We’re still waiting to see the full implications, but as a result, most investment banks are still finalizing their hiring plans for next year.

Larger hedge funds and prop shops, however, have relied on diversification to continue growing in both headcount and AUM. They are getting increasingly better at identifying markets from which to gain additional market share. We’ve seen buy side firms branching into new frequencies, strategies, and asset classes. On the whole, there are ambitious growth plans for 2024.

Machine learning has been one of the hottest topics discussed at QuantMinds over the past couple of years. Speakers have discussed its utilization for a wide range of projects. Its potential can be harnessed for automating BAU processes, derivative pricing and alpha generating strategies.

What was more hotly debated this year, however, was the governance processes that will need to be introduced simultaneously. Machine learning can sometimes result in undesirable outcomes, and many in the industry are asking to which degree a human overlay should be needed.

Securing top talent in the quant space is getting increasingly competitive. It’s an incredibly candidate-driven market and firms will do everything they can to retain their employees. Compensation packages are amongst the most competitive in the industry, non-compete periods can be in excess of 12 months, and counter offers are made for almost every candidate.

It was pleasing to hear that improving diversity within teams remains a big priority for most of the hiring managers that attended. It of course can be tougher within the quant space than other areas, but examples of effective initiatives are ensuring a diverse interview panel, using non-biased job advertisements, and creating an empathy-driven culture to attract and retain a diverse workforce.

With the diversification plans, as touched upon previously, competition for talent within certain markets is becoming increasingly fierce. More firms are now competing for the same revenue generating candidates, and thus it’s important to do everything possible throughout interview processes to get alpha generators onboard.

In order to make yourselves as attractive as possible to candidates, ensure to lean on your talent partner for guidance. They can offer insight into how you’re perceived in the market, how competitive your compensation structure is, and for each candidate can tune into the specific motivational factors impacting a decision.