My Age of Investment

Liu Hai also finds it very strange. Hedge funds are set up in Silicon Valley.

He asked uncertainly: "Because it's close to Facebook, it's easy to manage?"

"Wrong, that's just a small part of the reason!"

Xia Jingxing looked at Liu Hai and said with a smile, "Do you know what the more important reason is?"

The bangs shook like a rattle, he couldn't guess.

If you can guess, he has already succeeded in starting a business, where will he still work.

"The specialty of Silicon Valley, do you know what it is?"

Liu Hai replied: "Internet? Computer?"

"It's a programmer!"

Xia Jingxing walked into the office, stood at the window, and looked at the entire Silicon Valley.

Liu Hai didn't quite understand, and silently followed behind Xia Jingxing without saying a word.

"Have you heard of quantitative trading?"

Xia Jingxing withdrew his distant gaze and looked at Liu Hai who was standing beside him.

Liu Hai smiled and said, "Of course I have heard of it. Now everyone thinks this is the mainstream direction. The Renaissance and Deshao are among the best."

Xia Jingxing smiled and nodded, feeling a lot.

The Renaissance and Deshao mentioned by Liu Hai are among the top ten hedge funds in the world, with a management scale of tens of billions of US dollars, and will exceed 100 billion US dollars in the future.

The founder of the Renaissance, Simons, received his PhD in mathematics at the age of 23. After working in academia for a while, he felt bored and turned to finance.

Math professors trade stocks, the natural method is different from that of ordinary people, building models, and technology stocks.

The mathematical models of the Renaissance Fund are compiled by teams of hundreds of people, including experts in various fields such as string theory physics, astronomy, quantum mechanics, biology, mathematics, and more.

As a purely quantitative fund, all transactions of the fund are automatically executed by more than 10 million lines of computer code, with very little human intervention.

The Medallion Fund is well-known. In the two decades from 1998 to 2018, the compound annualized rate of return of the fund before deductions was 66%, which is close to 70%.

After deducting management fees and performance shares, the fund's annualized rate of return is still 39%.

The technology stock market crash in 2000 and the financial crisis in 2008 were all successfully escaped by this fund, which also achieved returns of 98.5% and 82% respectively that year.

David Shaw, the founder of Deshao Fund, obtained a doctorate in computer science from Stanford University at the age of 29. After working as a university teacher for a few years, he devoted himself to the financial career and became the vice president of Morgan Stanley's automatic analysis and trading technology department.

Two years later, in 1988, he started his own business again.

Find hidden market trends or pricing anomalies through sophisticated mathematical models, then trade with sophisticated computer technology.

This is the magic weapon of De Shao Fund. At its peak, the trading volume of this fund accounted for 5% of the entire NYSE.

Of course, the transaction model created by David Shaw has also become the company's top secret, just as Coca-Cola has always guarded its own beverage formula.

From the perspective of ten years later,

The combination of technology and finance is a big trend.

In the hedge fund industry, the level of technology content is a key factor in determining the quality of returns.

Xia Jingxing felt that he could not rely on himself for the success of the company.

If Envision Capital wants to develop more brilliantly, it must build a powerful technology team.

Technologies like machine learning and artificial intelligence can all be used in the financial field in the future.

After sorting out the language, Xia Jingxing and Liu Haishen had a talk.

His meaning is very clear. You can't do finance with traditional thinking. Companies need to recruit scientists from computers, mathematics, and even some interdisciplinary disciplines.

More than ten years after the previous life, Wall Street has also developed. It is not easy for finance majors to find jobs, but these students majoring in computer and mathematics are more popular.

Of course, there are exceptions for those with a relationship background.

Liu Hai understood what Xia Jingxing meant, and asked, "It's like the Facebook engineering team invented a set of software that specializes in tagging pictures on websites.

Vision Capital's technical team invented a set of software that collects historical information, development trends, etc. of financial markets? "

Xia Jingxing added: "Not only, but also to analyze this information, and provide investment reports, investment forecasts, and even automatically help us make investment decisions, or make adjustments to unreasonable decisions."

"A little magic!"

Liu Hai said with a smile, "Now those trading models are more of an auxiliary role, providing some analysis reports for investment managers as a reference."

"That's because it's limited by the development of computer technology."

Xia Jingxing spread his hands and said, "If everything I said can be realized now, then Renaissance and Deshao should also have such advanced transaction models.

It is precisely because the technology is immature that this gives us the opportunity to overtake in the corners. "

Liu Hai never thought of surpassing two well-known hedge funds. After all, Vision Capital has just been established and has not even made the first investment.

"If we put all the profits we make into this work, you may not get a return from Vision Capital for years, if not longer."

Liu Hai reminded, "Because as far as I know, scientific research investment has always been like this, and it takes a long and continuous investment to usher in the final harvest."

Xia Jingxing waved his hand, "You can do it with confidence, I will not withdraw capital from the company in the next few years.

On the contrary, if my other industries are harvested, I may continue to invest in Vision Capital. "

Liu Hai smiled at Xia Jingxing, "Then it's no problem, I'm mainly worried... You have other arrangements."

"I'm so familiar with people, so I don't need to speak out. I'm not the kind of short-sighted person. I invest money, and I must see a return in a year or two."

Xia Jingxing looked at Liu Hai, "On the contrary, as a fund manager, you should also have this kind of thinking and focus on long-term interests, not the few taels of silver in front of you."

Liu Hai said sternly, "I definitely won't, I choose to resign from Firstrade, enter a strange environment, an unfamiliar industry, and start from scratch.

In this regard, I have also made sufficient psychological preparations. I must calm down and learn and absorb new things with the mentality of a beginner.

You said that the company should focus on long-term interests, and I will strictly implement this code. "

"Don't be so serious!"

Xia Jingxing smiled and said, "Take it easy, any great company is built from scratch and built step by step, you don't have to be under too much pressure.

Our first step is to recruit people first. "

Speaking of recruiting, Liu Hai frowned and said, "You gave me 200,000 yuan. It cost tens of thousands of yuan to register an offshore fund, and another 100,000 yuan to rent this office. There are only tens of thousands of yuan in the account."

Xia Jingxing nodded. At present, the fund has not yet officially started to operate, and the management fee has not been collected. It is true that there is still a lack of preliminary funds.

He had no money in his account, so he could only sell another 10,000 shares of Amic.

After making up his mind, Xia Jingxing replied, "You don't have to worry about money matters. I'll give you another 200,000 in a few days."

Liu Hai nodded, Envision Capital only needs to recruit a small team of seven or eight people in the early stage, and $200,000 for a few months' salary is more than enough.

then.

Sitting in the empty office, the two chatted about more details about the company's operations.

The general direction is helmed by Xia Jingxing, including stock selection, investment decision-making and other aspects.

But the day-to-day work, communication and execution, requires bangs to complete.

The two are temporarily divided.

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