By Alexis DuFresne, Director of Asset Management Search, Whitney Partners
One of my favorite aspects of being an asset management recruiter is to be able to observe new and differentiated strategies investors create to make money. There’s an en vogue period for every strategy – last year was private lending, this year is the year of quant, next year will be long-short equity coming back again (mark my words!). This particular season, the buzzword on everyone’s lips is bitcoin.
Bitcoin is simply one of many digital assets, but it is by far the largest and most recognizable. Stemming from the creation of a mysterious Japanese hacker named Satoshi Nakamoto, (who very well could be a 28 year old American sitting in front of his computer in his boxer shorts) the cryptocurrency age began around 2009. Slowly at first, bitcoin gained traction upon the advent of payment processors, on line poker junkies, banking solutions for drug cartels, and a few smart developers and programmers on Wall Street who saw an opportunity to invest in decentralized currency.
As I went on my journey to identify credible bitcoin managers, marketers, and allocators for this piece, I found that these investors are unlike any other niche I have covered previously. The success of many start-up funds typically hinges upon the ability to market a track record, but there is no significant “track record” for the new world of cryptocurrency. Instead of a space which features ivy-leagued and tenured investors from the big shops, there is a totally new class of cutting edge talent, many of whom are young, and all of whom are at no less of an advantage trading than tenured investor peers. This shift has also put the “R&D” professionals in the spotlight doing the actual investing. Taking a starring role are programmers, developers, etc., who have had previously very little to do with marketing and managing assets.
There is no precedent for cryptocurrency, and the decision makers are almost all new to the scene. With that in mind, how does an allocator due diligence these fund strategies and determine which funds to invest in? How do these sector funds hire internally? What are the long-term investment opportunities? I assembled a few guests here to discuss.
The broader theme here that I’d like to leave you with is that our market thrives on innovation. Here is a strategy that is innovative by nature, given its short existence, and has created an intersection of hacking nerds, smart leaders, and young entrepreneurs.
ELLINGTON MANAGEMENT GROUP
Rasheed is the Head of Quantitative Strategies at Ellington Management Group. He developed the core set of strategies traded by the Quantitative Strategies Group, including strategies in equities, financial futures, commodities, and volatility.
Ellington Management Group is a $6.Sbln AUM asset manager. Ellington’s founding strategies include diversified credit, mortgage, and related markets, as we// as in quantitative macro and equities strategies. Ellington has a/so developed diverse quantitative macro capabilities, including use of systematic strategies to invest in global equities, futures, interest rate, options, synthetic credit, and foreign exchange markets. Read.
GREEN KEY PARTNERS
William Vranos is the CEO and founder of Green Key Partners. After gaining investment experience at Ellington Management Group, Mr. Vranos launched his own cryptocurrency focused firm in September 2017. Mr. Vranos holds a Math/CS degree from Dartmouth.
Green Key Partners is a cryptocurrency focused hedge fund dedicated to the digital assets space. The firm is involved in alpha generation strategies and smart beta portfolio offerings. Before to working together, the partners were trading cryptocurrencies, working in Amazon’s robotics department, and working on a PhD in theoretical physics at Brown. Read.