Nancy Davis (first from the right) and Sun Siyuan (first from the left) gave a speech at the Quants Hedge Fund Summit in new york.
However, Nancy Davis is just a hedge fund manager, which runs counter to the traditional impression-she has blonde hair, beautiful face and excellent temperament. I met Nancy at a hedge fund summit in new york. She and I are spokespersons of the same sub-forum. After the speech, many hedge fund managers gathered around to ask questions. The business cards handed over started with CFA and PhD, and Nancy took her time to solve their problems one by one.
Nancy is confident enough to answer questions from a group of doctors and chartered financial analysts. She has worked in Goldman Sachs Group for 65,438+00 years, and has been the head of credit, derivatives and OTC trading departments. After leaving her job, she joined Highbridge, a hedge fund in JPMorgan Chase, as an investment manager, and later founded her own hedge fund Quadratic Capital. Nancy has 17 trading experience in top financial institutions and can be regarded as one of the most senior hedge fund managers on Wall Street.
Nancy was born in Tampa, Florida, USA. Her mother is a high school teacher, and her father retired and did nothing at home. Nancy's family is a third-generation American immigrant whose ancestors came from Austria, a small country in Central Europe. Before high school, Nancy had been keen on outdoor sports and music, studied equestrian and sailing, and worked as a bass guitarist in an orchestra. After graduating from high school, Nancy was admitted to George Washington University with honors and became an undergraduate in economics.
When she was a child, Nancy was naive and liked outdoor sports such as equestrian.
"I invested my scholarship in the options market to make money."
"George Washington University is not a school that can directly reach Goldman Sachs in the usual sense. Goldman Sachs generally only recruits people at Ivy League schools. " Talking about her alma mater, Nancy is very modest. Perhaps to make up for the lack of school reputation, Nancy made extraordinary efforts during her school days: "I am very interested in mathematics, took many courses in financial derivatives, and tried to understand statistics, probability and options." With excellent results, Nancy won the presidential academic scholarship.
1994 Nancy (first from the right) graduated from high school and passed the Economics Department of George Washington University with honors.
But for Nancy, getting good grades and getting scholarships is not enough: "There are many opportunities in the field of options. Even when I was a student, I could invest a little money. That's what I did; Instead of spending money on shopping, eating, traveling, etc., I invested in options trading. " By investing the scholarship and part-time income in the options market, Nancy not only paid all the tuition and living expenses during her college years, but also gained some extra income.
This experience also laid a solid foundation for Nancy's future career. "It is a wonderful thing to put your labor income into the market and earn more money from it; That's how I got into the field of options. This is not my job, but my passion. " Nancy said: "there are asymmetric payments for options, which all depend on the probability distribution;" If your point of view is contrary to the market, you can make profits or control risks in the market through options. "
"My success at Goldman Sachs should be attributed to the team."
From 65438 to 0998, Nancy graduated with honors from George Washington University. With outstanding performance and investment experience in the field of options, she won the favor of Goldman Sachs and became a seller's volatility trader. After her success in transaction modeling, Nancy was invited to work in the risk arbitrage department of Goldman Sachs to study traditional volatility strategies, such as deviation and correlation trading opportunities, as well as relative value and volatility arbitrage.
In 2002, the risk arbitrage department of Goldman Sachs was merged into the self-operated department. After the establishment of the new department, Nancy began to arbitrage credit and capital structure. Through option modeling, she successfully subverted the traditional risk arbitrage model of the self-operated department-Nancy designed a number of options trading strategies, using the company's leveraged buyouts and dividends for risk arbitrage. Soon after, the strategy she designed was a great success, which changed the way the proprietary department of Goldman Sachs used options.
Nancy humbly attributed her success to the team: "Goldman Sachs has a good learning atmosphere and many excellent tutors guide me." In 2003, Nancy officially became the head of credit, derivatives and OTC of Goldman Sachs Group. Subsequently, the risk arbitrage department of Goldman Sachs was transformed into a traditional hedge fund, and Nancy's options trading scope also expanded to commodities, credit, foreign exchange, interest rates, mortgage loans, dividends, stocks and other fields.
"I quit my job and started my own hedge fund because of industry opportunities."
Nancy resigned from Goldman Sachs in early 2008 and became the investment manager of HighbridgeCapital, a hedge fund owned by JPMorgan Chase. In Gao Qiao, she manages a derivative portfolio of about $500 million. But not long after, Nancy resigned again and founded her own hedge fund Quadratic Capital with her partners. When talking about the reasons for leaving her job, Nancy said that the supervision of the financial industry has undergone tremendous changes, and it was this opportunity that made her decide to start her own business.
Nancy was interviewed by an internal hedge fund in Reuters.
"It is a major decision to leave a high-paying job and set up my own company, but I see great opportunities in the options market, especially considering the low-yield market environment, systematic selling, regulatory changes, and the current situation that traders' risk tolerance has dropped significantly due to regulatory changes. Nancy said: "On the other hand, the real economy is still investing in the options market, resulting in an imbalance between supply and demand. The huge opportunities in the market prompted me to make this decision. "
Nancy has always been very proud of her hedge fund Quadratic: "Most macro hedge funds' portfolios are Delta One derivatives, the returns are linear, and the risk management method is stop loss; Quadratic's portfolio is entirely based on options and their derivatives, so it is clear what the loss limit of the portfolio is. We use the low volatility strategy to create income for investors by using convexity, and the return on investment is asymmetric. "
"Option trading is a very interesting thing."
Nancy never hides her love for options trading: "I call myself an options girl because I am keen on investing in options." Nancy's hedge fund involves five categories of assets: commodities, foreign exchange, credit, interest rates and stocks, and its portfolio is entirely based on options and swap options. Nancy said that this is done to protect the safety of investors' funds: "The risk of our portfolio is very clear, and the key to profitability is whether the investment theme and strategy work."
Nancy (first from left) was interviewed by Sun Siyuan of Sina Finance (first from right) NYSE.
In the current environment, the global options market is full of liquidity and options investors are more diversified. Many people use options to hedge risks, and some people sell options to get returns. Portfolio based entirely on options and swap options is usually better than Delta One portfolio (portfolio consisting of stocks, bonds, futures and forwards). Delta One portfolio presents linear payment, and the asymmetry of options makes it easier for investors to get high returns.
Compared with the general portfolio, the option portfolio is more complicated, but also more interesting and exciting. Nancy said, "because the market is always changing, there are many specific concepts involved here, such as $ Term structure, that is, price fluctuations at different maturity dates;" There is also option skew, that is, the price fluctuation of different options. Probability means everything about options trading. Options can be fun for people who are interested in mathematics and statistics. "
"I want to change the male-dominated status quo on Wall Street."
Hedge funds can be regarded as one of the most stressful and high-tech industries in the world, where engineering male, a well-educated American university, is gathered. I asked Nancy if there were too few women in this field, and she told me confidently: "Some studies show that women treat risks differently from men, and female investors may be more conservative. They tend to reduce volatility and reduce risk protection funds, so they are more worthy of being entrusted. "
Nancy is the keynote speaker at the SALT meeting of the world's top business forum.
"Sometimes when people see each other as blonde, it is inevitable that there will be some prejudice; But when you feel the other person's words and wisdom, you will change your mind quickly. " Nancy said: "Investors want to increase the value of their wealth. As long as you can bring rewards to everyone, they won't care if you are a man or a woman. " The ultimate concern of the market is the efficiency of profit. It is most important to make the right decision for customers and create benefits for customers. "
For the secret of success in the field of hedge funds, Nancy said that it is necessary to form a good interaction with investors, let them understand the operation of funds, let customers believe in their trading strategies, and create higher returns: "There are not many women in the field of hedge funds, and I want to change this situation now. I also want to encourage all women and other young people to pursue their passions and interests. No matter what you do, as long as you love what you are doing and are enthusiastic, success will follow. "