TTU81: How A Serial Entrepreneur Built an Algorithmic Trading Firm ft. Oliver Steinki of Evolutiq – 1of2

Top Traders Unplugged

Niels Kaastrup-Larsen

Business, Business News, Investing, News

4.8 • 670 Ratings

🗓️ 2 June 2015

⏱️ 63 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Our next guest has started and invested in many companies, and is from an entrepreneurial background. First and foremost, he is concerned with running a business, but he also knew he wanted to be a portfolio manager from an early age. Hear the fascinating story of Oliver Steinki on this episode, as we dive into his new firm and the details behind his models and strategy.

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In This Episode, You’ll Learn:

The entrepreneurial background that Oliver comes from.
How he studied in Germany, Madrid, and Manchester.
About his childhood and when he started to realize he was interested in mathematics and finance.
What he likes doing when he is not managing his own firm.
What algorithmic trading is all about.
How the scientific trading model generates signals.
What the trade implementation phase entails and how it works.
What it is that Oliver is trying to deliver to his investors.
About the other companies he started before his current firm, and all the different industries those companies are in.
Why he is a business man first and a trader second.
Who is on his team and the roles they fill.
Why the early phase of his business is important and what you can learn from how Oliver tackles this phase.
How he would scale his current business model.
How he creates a culture and keeps a partnership with his cofounders.
His track record so far.
The details of how his strategy is created.
What a levy-process model is.
How many models he is testing and trading and how different they are.
Why they need to be right 54% of the time with their models.

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Resources & Links Mentioned in this Episode:

Read about the French mathematician that Oliver discusses, Paul Lévy.
Niels mentions his earlier conversations with Dave Sanderson, which you can listen to here and here.

Follow Niels on Twitter, LinkedIn, YouTube or via the TTU website.

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Transcript

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0:00.0	As you see a lot of traders which come out of big firms, which are definitely great
0:07.0	traders, but they don't know how to do a cash flow statement on a company level and they
0:12.0	might not be able to estimate the real cost of running business.
0:16.1	To get the revenues wide, it's pretty easy in the alternative investment strategy. You have your average
0:21.7	management fee and your average performance fee. You need to make an estimate, okay, what is the
0:26.4	performance you can realistically achieve? And then you come up with your revenues. It's pretty easy.
0:32.0	But what's pretty tough is a correct cost estimation in my opinion.
0:36.9	Picture this for a second.
0:39.3	A small group of research savvy PhDs
0:42.3	who have spent a large portion of their adult lives
0:45.7	studying and developing complex financial models
0:49.7	with the intention of being able to make accurate forecast
0:54.2	of where to buy and sell financial instruments,
0:58.6	decides to venture into the world of entrepreneurship.
1:02.5	You would expect the model to outperform a simple rule-based strategy
1:07.2	like a classical trend-following approach.
1:10.0	As amazing as technology and sophisticated systems are,
1:15.3	they don't always end up performing better than their simpler cousins.
1:20.0	But perhaps they perform differently.
1:23.1	And that may be just what you as an investor is looking for.
1:28.3	If algorithmic trading seem overwhelming to you, today's guests not only practice it,
1:35.3	he teaches it as well to aspiring students.
	...

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