Brian Eckerly, an electrical engineering student at Ohio State University, booted up his Dell laptop one morning in January and loaded a little program he'd finished coding the night before. Numbers flashed on the screen, and Eckerly scanned them for a minute. Then he went to class.
That day, and in the following weeks, the laptop sat undisturbed at Eckerly's off-campus apartment in Columbus, carrying out his program's instructions. It connected to an online brokerage firm, gathered stock data, crunched some statistics, determined whether certain conditions had been met and, if so, executed trades. Eckerly began with a handsome sum--US $100 000--and in seven weeks his program increased it to $394 190.
If only it were real money!
It was all for a trading contest organized by Interactive Brokers Group, a $2.8 billion securities firm in Greenwich, Conn., that wanted to find tech-savvy engineers and scientists willing to work in the financial industry.
”The old trading world required big, aggressive, street-smart folks--now it's technology skills that count,” says Steven J. Sanders, a senior vice president with Interactive. ”We just don't ever get enough good technologists.”
The contest, which was open to students from the United States, Canada, and Mexico, required participants to elaborate a trading strategy and write software to execute it. Each contestant took a starting stake in virtual money and used it to trade stocks, bonds, options, futures, and currencies during an eight-week period. Although all trades were virtual, taking place on a simulation system created by Interactive, the buying and selling prices were based on real market data.
Real, too, were the cash prizes. Eckerly, who finished first, took home $100 000. Two runners-up each got $50 000, and several other participants got prizes of $10 000 or $1000.
The financial industry has long been known to hire math whizzes as quantitative analysts, or ”quants,” who concoct pricing models, probe new ways to quantify risk, and mine data. Now, as automated trading systems take over ever more of the substantive work on Wall Street, many firms are seeking quants who not only know the math but the nuts and bolts of IT systems, too.