Quantitative analysts, quants, were the protagonists of the story of the development of a new financial system. And they have a lot of antagonists. Since the financial crisis they need to make big decisions and answer big questions. Has your maths destroyed the system? What are your ideas to fix it?…This is more than the climax of critical moments. It asks for the "right to exist"?
The best bad choice
They're not in a preferable situation. The regulatory waves of centralization and standardization are a clear signal against creative solutions…instead of distinguishing between the toxic and the healthy financial objects, methodologies, technologies…new complexity shall lead to simplicity?
What choices do quants have? Seek niches where the new regulatory regime is not applicable…fight it…surf on the regulatory waves?
Surf on its waves is the best bad choice. It will involve them more in industrial than lab work (instruments are becoming less complex, some derivatives will be centrally cleared, central counter party regimes, margin rules and other collateral agreements shall minimize credit risk…). But they may find new ways against a possible margin compression that does not only harm Wall Street but also Main Street (real economy).
Don't make a mistake, I'm not against regulation...but the antifragile needs diversity, options…and fragility.
Help quants leverage their work
We decided to help quants by getting them a start point at a much higher level…let UnRisk do the industrial work and empower quants creativity by high level development tools. Uncompromising. Include a unconstrained know how transfer.
The important (probably not the profitable) decision
To make this decision we walked through The Quant Innovation Mesh and made UnRisk Quant part of the resolution of the "crisis" quants need to face.
Its Idealistic, Off-Time, Literary, MultiFlow, Quant Risk Work, Development…for small quant groups...Setting the stage for successful risk management, leveraging technology, building quant finance skills…its built from bottom up…offering valuation and data management from the single instrument to the most complex portfolio…it meets the regulatory requirements…but empowers the engineering and validation of new financial concepts…its multi strategy-multi model- multi method…it has implemented all practical details…
Its structured, following the conventions of quant systems (preprocessing-processing-post processing). It has constructors and solvers that empower quants resolving the progressing problems.