Why quants quit banks and don't want to come back
There's a reason quants quit banks and hedge funds and it's not always because they think the perks and the pay are better at Palantir. It takes a lot for a quant to quit - we are, by our natures, thoughtful people who have significant latency. Rarely do we quit on the spot: it's simply that, over weeks and months, we get ground down and start to think there are more yesterdays than tomorrows in jobs that are no longer as fun as we thought.
Long experience suggests that these are the situations that bring those thoughts about:
0) “The business wants…” Why in the name of God do you pay anyone hundreds of thousands per year if they’re not business? If you’re too obtuse to realize that distancing your team from their actual purpose is a bad move you need to quit banking and move to local government.
1) “We have a new diversity policy...” Like it or not, most quants and strats are white males. This is far from ideal but having a policy that makes it even less likely that existing quants and strats will be promoted is not good for morale. The same goes for diversity training - this may be good in itself and a way of protecting against future lawsuits, but replace XVA training with this, and Quants start quitting.
2) “I’ve hired a new Quant...” Now, it's fine to hire a quant if you’re a quant, but it's rather less fine if you’re a trader who thinks that reading an old copy of Hull and owning an unread but signed set of Wilmott’s FAQ book makes you a good judge of quant talent. Not respecting the skills of your team and failing to give them a say on new recruits is a cause of not just a correlation with staff turnover.
3) “You and the other developers can build a…” I hate to break this to you, but quants are not developers. Yes, I know that many have attended C++ lectures and they write a lot of code, but one of the most common reasons for quants quitting is being moved into the pitiful IT Bonus Pool with the VB Programmers. Even the suggestion of this is enough for them to update their CVs.
4) “We need to take a more aggressive approach...” Quants are not amoral robots. Don't ask them to do things that are unethical, or they will leave.
5) "Frankfurt...." Just the word. In any context. Even saying, “You’re not being moved to Frankfurt”, is enough to make a quant think he’s being shafted on the grounds that you have mentioned the void.
Dominic Connor is a quant, headhunter and sometime journalist who counts from zero.
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