Employee Profiles

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Ollie Watson, Quantitative Analyst

What is your role at the D. E. Shaw group?

I build models that attempt to predict price movements of financial instruments. This involves a surprisingly wide variety of tasks. A typical project might begin with my getting up to speed on internal and external research in a particular field to help me generate and develop ideas germane to that area. If the use of a new data source is involved, there is an initial hands-on evaluation of the data set in question, sometimes followed by a process of negotiation with the data vendor that can be rather "businessy"—an interesting change of pace for a person with a quantitative background. I would then apply mathematical and statistical techniques to see if there is a tradable "signal" in the data. If we collectively determine there is one, I then would code up a model designed to improve the prediction of future price movements. If the model passes our internal review process, we would begin trading it. I would then keep close watch on the behavior of the model, checking that its performance was consistent with expectations, and staying on the lookout for ideas that might improve its performance. Other projects might involve thinking about how to manage risk or transaction costs, and writing associated software to do this in a careful and methodical way.

How has your role developed since you started at the firm?

I have a Ph.D. in number theory and joined the firm knowing very little finance. I had quite a lot to learn, but the projects I was assigned were fortunately selected with a view to helping me build up my knowledge base quickly. This educational process was also facilitated by my managers and colleagues, who taught me skills ranging from quick coding hacks to useful ways of estimating signals in noisy data. As I've gained more knowledge of the financial markets, my responsibilities have broadened in scope.

What led you to join the D. E. Shaw group?

I was very impressed by the people who interviewed me. The recruiting process was tough—the questions I was asked were probing and sometimes quite challenging—but it was done in a way that I really enjoyed. The people I met were remarkably friendly, and seemed to genuinely like what they were doing. I definitely got the sense that employees were respected and valued by the company and that I would enjoy working here if I joined.

Has your experience at the D. E. Shaw group met your expectations?

My experience has actually exceeded my expectations. When I joined, I had a very inaccurate picture of what quantitative analysts actually did. To be honest, I had a general impression that investment firms often hire Ph.D. mathematicians and physicists mainly to impress their investors, and that high school math and some basic coding skills would mostly be sufficient to do the actual work. Needless to say, this view was incorrect. I quickly came to realize that the research skills developed in a quantitative Ph.D. discipline have very real and transferable value. In fact, many of the problems I have faced here are as complex, in their own way, as the research topics I faced as a grad student. When I joined the firm, I also expected that the world of "work" wouldn't be nearly as much fun as the world of academia and that this would be a difficult transition for me. I find it remarkable how many aspects of the university life that I enjoyed have been successfully reproduced in the working environment here, especially the same collaborative spirit and respect for the value of research and good ideas.