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How to get a trading job at BlueCrest Capital Management now

BlueCrest Capital Management has changed. Once one of the world's hottest hedge funds, it became one of the world's hottest family offices in late 2015. That metamorphosis doesn't seem to have inhibited its ability to recruit - if anything, just the opposite. Last year BlueCrest hired top traders like Sam Rosenberg from Goldman Sachs and Scott Cowling, the former head of market structure and electronic trading at Blackrock. This year, it continues to recruit - very selectively.

Since January, BlueCrest has added a handful of people, according to the FCA Register. They include Evgenii Stroinov, an equity research analyst from Renaissance Capital, who joined in January and David Bowen, a former currency portfolio manager at hedge fund Pine River and trader at Goldman Sachs. It also brought on Matthew Read, a veteran Nomura trader, who's switched into risk management at BlueCrest instead. 

BlueCrest didn't respond to a request to comment for this article. Speaking off the record, people close to the fund said the shift to family office status has both enabled BlueCrest to pay well and to become more choosy about who it hires. When founder Michael Platt closed BlueCrest to public money, he said it would enable him to pay traders a larger share of the profits than before. Insiders said payouts of 20% of pnl are now standard after BlueCrest hiked trader pay in January 2016. 

Not everyone can get into the new-look BlueCrest though. Nowadays, BlueCrest is said to expect traders it hires into areas like equities and macro trading to have a sharpe ratio of over two - and in some cases much higher.

"Some hedge funds will look at traders with sharpe ratios in excess of 1.5," says one insider. "But the bar at BlueCrest is higher because as a family office there's less capital and more need to increase the returns on capital deployed."

Bloomberg in January reported that BlueCrest achieved returns of 54% last year, following returns of 50% in 2016. It said the firm gave up $7bn in external funds when it switched to managing the money only of founder Michael Platt and its partners.

Some traders cast aspersions on BlueCrest's alleged new choosiness. "A sharpe ratio of two is good, but not incredible," says one. "Admittedly most guys in a bank are on 0-1.5, but the real outliers are on 3+." Fewer than 5% of top traders at banks like Goldman Sachs and J.P. Morgan are thought to hit sharpe ratios of three and above, he added.

BlueCrest's performance demands and reduced capital under management have coincided with a raft of exits. In 2016, the fund cut headcount by 89 people, or 21%. Last year, Christian Dalban, Nomura’s ex-head of equities trading, left BlueCrest in June 2017. Dalban had been building the equities business, but various members of his team also subsequently disappeared.

Headhunters who work with hedge funds said BlueCrest is a hard task master, but then so are they all. "If you make money, everything's fine. If you don't, it's not," says one, speaking off the record. The holy grail for every hedge fund is a star trader who can make money now, she added: "Everyone's looking for traders with a strategy that's relevant to current markets. It's no good if you made money last year or the year before."

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AUTHORSarah Butcher Global Editor
  • be
    7 April 2018

    "But the bar at BlueCrest is higher because as a family office there's less capital and more need to increase the returns on capital deployed."

    Much easier to earn higher sharpe ratios on smaller AUM. Also, HFT has a sharpe of 3 or 4, albeit on a very high trade-turnover: without talking about specific strategies (and associated costs), it is unclear what sharpe should be regarded as reasonable.

    A sharpe of 1.5 - 2 post transaction costs is very good for an equity portfolio manager ... but also achievable with a fundamental systematic long/short fund in mid-cap stocks normal market conditions.

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