Nils Berger

German Chancellor Olaf Scholz issued a stern warning to Italy’s UniCredit on Monday, following the bank’s surprising move to significantly increase its stake in Commerzbank, Germany’s second-largest lender. The Italian banking giant now holds a 21% stake, surpassing the German government, which owns 12%, and sparking fears of a potential takeover. Speaking to German television from New York, Scholz expressed his strong disapproval, emphasising the importance of protecting Germany’s financial institutions from what he described as “unfriendly attacks” and “hostile takeovers.” The chancellor underscored Commerzbank’s critical role in supporting the German economy, particularly in providing essential funding to small- and medium-sized enterprises. Full details on our website https://panfinance.net #Panfinance #BankingCrisis #Commerzbank #UniCredit #EuropeanFinance #MarketWatch #FinancialStandoff

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Two Sigma with an AUM of $60+ Billion, is among the top hedge funds and one of the most preferred hedge funds by Quants. It's known for its Scientific Approach. Here's an interview question asked in the Quant role interview by Two Sigma. You have a random number generator that picks numbers between [0,1] uniformly at random. You draw numbers from this generator and keep adding the result. What is the expected number of Draws to get this sum to reach 1? Solution - The image attached below Kickstart your Quant Interview Prep, and use the Coupon code -"QI20OFF" to get 20% off Kickstart your Quant Interview Prep ‘Interview Byte’ contains 500+ Interview questions (https://lnkd.in/gkqcrrKf) Quant Insider Project Handbook has 15 industry-oriented projects, which include 10 industry-oriented projects based on challenges conducted by Top HFT's and Hedge Funds. (https://lnkd.in/gWBEn78U) Check out Quant Insider Stack - https://lnkd.in/gcfdUEfg A Bundle of Interview Byte (500+ Interview questions) and Quant Insider Project Handbook Quant Insider Career Catalyst is your guide to all interview prep tips, preparation roadmap and job application strategies (https://lnkd.in/gVhA4tNG) Checkout our course Machine Learning for Finance - Designed by Industry Veterans Hariom Tatsat, CQF, FRM with years of working at Wallstreet - https://lnkd.in/gtJDWcus Use Coupon code - "EARLYBIRD20" for 20% off on the ML for Finance course "𝐐𝐔𝐀𝐍𝐓𝐈𝐓𝐀𝐓𝐈𝐕𝐄 𝐀𝐧𝐚𝐥𝐲𝐬𝐭 𝐃𝐞𝐯𝐞𝐥𝐨𝐩𝐞𝐫 𝐒𝐭𝐫𝐚𝐭 -𝐓𝐇𝐄 𝐏𝐑𝐎𝐅𝐄𝐒𝐒𝐈𝐎𝐍" Course, taught by Andrey Chirikhin 𝐂𝐥𝐢𝐜𝐤 𝐨𝐧 𝐭𝐡𝐞 𝐋𝐢𝐧𝐤 𝐭𝐨 𝐄𝐧𝐫𝐨𝐥𝐥 𝐢𝐧 𝐭𝐡𝐞 𝐂𝐨𝐮𝐫𝐬𝐞 𝐍𝐨𝐰 - https://lnkd.in/gikuMSRg Use Coupon Code -"partner25" to get 25% off on the Course We have 𝐒𝐩𝐞𝐜𝐢𝐚𝐥 𝐩𝐫𝐢𝐜𝐞 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐬𝐭𝐮𝐝𝐞𝐧𝐭𝐬- £𝟏𝟒𝟗 To get the course at £𝟏𝟒𝟗, you just need to register on the Website with your University Email ID and you will receive the Coupon For more quant finance memes follow us on Instagram - Quant Insider (https://lnkd.in/gfjc4hBu)

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The Alpha Arms Race: How Multi-Managers Are Shaping the Hedge Fund Industry > Multi-manager hedge funds have upended the traditional hedge fund model by scaling alpha generation. Unlike single-manager funds, they allocate capital across specialized portfolio managers (PMs) who trade independently. This model has propelled AUM growth by 175% from 2017 to 2023—far outpacing the 13% growth of the broader hedge fund universe. This “alpha factory” approach fuels multi-managers’ appeal to institutional investors, who see these platforms as both diversifiers and consistent alpha generators. The Competitive Edge—and Its Costs > The staggering AUM growth has introduced new challenges: • Cost of Talent: Top PMs now command compensation packages unimaginable a decade ago. Pass-through fees help multi-managers foot these bills, with average expenses reaching an estimated 5% before incentive fees. • Scaling Risks: As AUM swells, platforms must rapidly expand PM teams, yet top talent remains scarce. Scaling without compromising alpha density is delicate; some firms have returned capital to preserve performance. • Operational Costs: Beyond PM salaries, multi-managers have tripled headcount to over 18,000 from 5,300 in 2015, reflecting immense operational complexity. This expansion signals that multi-managers rely as much on sophisticated infrastructure as they do on investment. Balancing Alpha Generation with Liquidity > Multi-managers are known for stellar risk-adjusted returns, but liquidity trade-offs include: • Lock-In Periods: Nearly 25% now enforce redemption terms of two years or longer, with some stretching to five years. Longer lock-ins enable multi-year alpha strategies but limit investor flexibility. • Leverage and Volatility: These funds use leverage to amplify alpha, but with many funds adopting similar models, “deleveraging events” pose real risks, making high volatility amid sudden shifts a genuine concern for allocators. Come and chat to us at ARB Asset Management and see how we're different. #trading #multistrat #alpha #investing

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Why do top hedge funds and VCs trust Definitive? 🤔 Here are just some of the things our clients love about trading onchain with Definitive 📈 1️⃣ Advanced Order Types: Leverage algorithmic trading with Limit Orders & TWAPs for trade automation and best execution. 2️⃣ Better Prices. Higher Returns: Our smart order router finds the best prices across 100+ venues to execute orders in the deepest liquidity pools. 3️⃣ Order Flow Protection: Randomized TWAP fill sizes and times, sub-accounts, and our off-chain backend mask trade intent. 4️⃣ Asset Segregation: Every client trades from dedicated, fully-permissioned smart contracts, for best-in-class security. 5️⃣ Post-Trade Reporting: Portfolio reporting including real-time fill analysis, P&L views, and activity history. All exportable for audit purposes. 6️⃣ Pre-Trade Compliance: Top-tier onchain compliance solutions preemptively identify and flag pools containing assets from sanctioned entities.

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😳 Top5 Largest Hedge Funds in Terms of AUM 5. Renaissance Technologies: $106bn //Renaissance Technologies is a New York-based quantitative hedge fund that uses mathematical and statistical methods to uncover technical indicators that drive its automated trading strategies. 4. D.E. Shaw: $109bn //D.E. Shaw was founded in New York City in 1988. The firm's systematic strategies are quant based and focus on alternative investments and long-oriented investments. 3. AQR Capital Management: $120bn //AQR Capital Management is based in Greenwich, Conn., and uses quantitative analysis to develop its strategies focused on equities and alternatives. The firm offers its strategies via investment vehicles and registered funds. 2. Bridgewater Associates: $197bn //Bridgewater Associates is based in Westport, Conn., and provides services to pension funds, foreign governments, central banks, university endowments, charitable foundations, and other institutional investors. 1. Citadel: $339bn //Citadel is based in Miami and focuses on five strategies. These are (1) commodities, (2) credit and convertibles, (3) equities, (4) global fixed income and macro, and (5) global quantitative strategies. #finance #business #hedgefunds #fund #assetmanagement #assets #citadel #bridgewaterassociates #aqr #renaissance

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𝗗𝗘𝗠𝗬𝗦𝗧𝗜𝗙𝗬𝗜𝗡𝗚 𝗔𝗟𝗚𝗢𝗥𝗜𝗧𝗛𝗠𝗜𝗖 𝗧𝗥𝗔𝗗𝗜𝗡𝗚: 𝗔 𝗕𝗘𝗚𝗜𝗡𝗡𝗘𝗥'𝗦 𝗚𝗨𝗜𝗗𝗘 𝗧𝗢 𝗦𝗬𝗦𝗧𝗘𝗠𝗔𝗧𝗜𝗖 𝗧𝗥𝗔𝗗𝗜𝗡𝗚 Welcome to the first post in our series on algorithmic trading! At 𝗣𝘂𝗹𝘀𝗲𝗤, we empower traders with 𝗿𝗼𝗯𝘂𝘀𝘁, 𝗱𝗮𝘁𝗮-𝗱𝗿𝗶𝘃𝗲𝗻 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗲𝘀. Algorithmic trading, or "algo trading," uses predefined rules to execute trades automatically—removing emotions and guesswork from the process. In this post, we’ll explore the basics of algorithmic trading, how it works, and why it’s a powerful tool for traders of all levels. We’ll also show how robust strategies—when properly developed, tested, and automated—can give traders a 𝗹𝗼𝗻𝗴-𝘁𝗲𝗿𝗺 𝗲𝗱𝗴𝗲. --- 𝗪𝗛𝗔𝗧 𝗜𝗦 𝗔𝗟𝗚𝗢𝗥𝗜𝗧𝗛𝗠𝗜𝗖 𝗧𝗥𝗔𝗗𝗜𝗡𝗚? Algorithmic trading uses computer algorithms to make trading decisions, submit orders, and manage trades automatically. These algorithms follow predefined rules based on market data, technical indicators, or statistical models, **eliminating emotional biases** like fear or greed. Here’s how it works: 1. 𝗗𝗮𝘁𝗮 𝗖𝗼𝗹𝗹𝗲𝗰𝘁𝗶𝗼𝗻: The algorithm analyzes market data, such as price movements or volumes. 2. 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝘆 𝗘𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻: Based on the data, the algorithm follows rules (e.g., buy if the price crosses a moving average). 3. 𝗠𝗼𝗻𝗶𝘁𝗼𝗿𝗶𝗻𝗴: The algorithm continuously monitors the market and adjusts trades based on the strategy’s rules. --- 𝗪𝗛𝗬 𝗜𝗦 𝗔𝗟𝗚𝗢𝗥𝗜𝗧𝗛𝗠𝗜𝗖 𝗧𝗥𝗔𝗗𝗜𝗡𝗚 𝗜𝗠𝗣𝗢𝗥𝗧𝗔𝗡𝗧? Key advantages of algorithmic trading include: - 𝗦𝗽𝗲𝗲𝗱: Algorithms execute trades in milliseconds, faster than any human can. - 𝗖𝗼𝗻𝘀𝗶𝘀𝘁𝗲𝗻𝗰𝘆: Algorithms follow rules strictly, avoiding emotional decision-making. - 𝗦𝗰𝗮𝗹𝗮𝗯𝗶𝗹𝗶𝘁𝘆: Algorithms manage multiple strategies and markets at once, which manual traders cannot do. With 𝗣𝘂𝗹𝘀𝗲𝗤, traders can simulate their equity curves, helping them see potential risks, returns, and drawdowns. This allows traders to stick to their strategy without reacting emotionally to market movements. --- 𝗖𝗢𝗡𝗖𝗟𝗨𝗦𝗜𝗢𝗡 Algorithmic trading is transforming how traders engage with the markets. By automating strategies, traders can remove emotional biases and follow a **data-driven plan**. Simulating performance helps traders manage risks more effectively and stay consistent. 𝗩𝗶𝘀𝗶𝘁 [PulseQ.io](https://www.pulseq.io/) to learn more. --- 𝗜𝗻 𝘁𝗵𝗲 𝗻𝗲𝘅𝘁 𝗽𝗼𝘀𝘁, 𝘄𝗲 𝘄𝗶𝗹𝗹 𝗱𝗶𝘃𝗲 𝗶𝗻𝘁𝗼: 𝟮. 𝗕𝗲𝗻𝗲𝗳𝗶𝘁𝘀 𝗼𝗳 𝗕𝗮𝗰𝗸𝘁𝗲𝘀𝘁𝗶𝗻𝗴 𝗶𝗻 𝗧𝗿𝗮𝗱𝗶𝗻𝗴 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗲𝘀. --- 𝘋𝘪𝘴𝘤𝘭𝘢𝘪𝘮𝘦𝘳: 𝘈𝘭𝘭 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯 𝘱𝘳𝘰𝘷𝘪𝘥𝘦𝘥 𝘣𝘺 𝘗𝘶𝘭𝘴𝘦𝘘 𝘪𝘴 𝘧𝘰𝘳 𝘦𝘥𝘶𝘤𝘢𝘵𝘪𝘰𝘯𝘢𝘭 𝘱𝘶𝘳𝘱𝘰𝘴𝘦𝘴 𝘰𝘯𝘭𝘺. 𝘛𝘳𝘢𝘥𝘪𝘯𝘨 𝘪𝘯𝘷𝘰𝘭𝘷𝘦𝘴 𝘳𝘪𝘴𝘬, 𝘢𝘯𝘥 𝘦𝘢𝘤𝘩 𝘪𝘯𝘥𝘪𝘷𝘪𝘥𝘶𝘢𝘭 𝘪𝘴 𝘳𝘦𝘴𝘱𝘰𝘯𝘴𝘪𝘣𝘭𝘦 𝘧𝘰𝘳 𝘵𝘩𝘦𝘪𝘳 𝘰𝘸𝘯 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵 𝘥𝘦𝘤𝘪𝘴𝘪𝘰𝘯𝘴. #AlgorithmicTrading #SystematicTrading #FinTech #TradingStrategies

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Bank of America Tops Estimates on Better-Than-Expected Investment Banking - Q2 Earnings Per Share (EPS) $0.83 vs Exp. $0.80 - Q2 Revenue $25.54bn vs Exp. $25.22bn ▶ 29% increase in investment banking fees to $1.56bn vs Exp. $1.51bn. No. 3 in investment banking fees according to Dealogic as of June 20, 2024. ▶ Fixed Income, Currencies and Commodities (FICC) revenue up 3% to $2.7bn, and Equities revenue up 20% to $1.9bn. Highest 2Q sales and trading revenue in over a decade with 9 consecutive quarters of YoY sales and trading revenue growth. ▶ Asset management fees rose 14% to $3.37bn, buoyed by higher stock market values, helping the firm’s wealth management division post a 6.3% increase in revenue to $5.57bn, essentially matching the estimate. ▶ Expects Net Interest Income (NII) on a fully taxable-equivalent basis to increase to about $14.5bn in the fourth quarter vs Exp. $14.3bn. #BankofAmerica #InvestmentBanking #Trading #AssetManagement

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Morgan Stanley Beats Estimates on Better-Than-Expected Trading and Investment Banking - Q2 Earnings Per Share (EPS) $1.82 vs Exp. $1.65 - Q2 Revenues $15.02bn vs Exp. $14.3bn ▶ Equity trading generated an 18% jump in revenue to $3.02bn vs Exp. $2.68bn Equity net revenues increased from a year ago reflecting strong performance across business lines and regions, particularly in Asia, on stronger client engagement and a constructive market environment. ▶ Fixed Income Currency & Commodities (FICC) trading revenue rose 16% to $1.99bn vs Exp. $1.86bn Fixed Income net revenues increased from a year ago driven by higher results in credit reflecting strong financing revenues and in foreign exchange on higher client engagement ▶ Investment banking revenue surged 51% to $1.62bn vs Exp. $1.4bn Advisory revenues increased from a year ago on higher completed M&A transactions (183 transactions YTD, 3rd on Global M&A Advisor Ranking). Equity underwriting revenues increased from a year ago driven by private placements and higher revenues in IPOs and convertible offerings. Fixed income underwriting revenues increased significantly from a year ago primarily driven by higher non-investment grade issuances. #MorganStanley #InvestmentBanking #Trading #Finance #Applications

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Thread: A Comprehensive Guide to Relative Value Volatility Trading 🧵 with mathematical breakdown https://lnkd.in/gHAp-Rvi

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5 Things to Know - Thing 5) Gold/Investment Research: DKI Takeaway: In 2012, I attended an investment conference where a prominent hedge fund manager extoled the virtues of Viacom. At the time, most big hedge funds had huge positions in Viacom, CBS, and Disney which owned ABC and ESPN. After a week of research, I went back to a friend at a multi-billion-dollar fund which owned Viacom. I asked how he got comfortable with the risk of streaming television, YouTube, Hulu, Netflix, piracy, and DVR-powered commercial avoidance. His answer was “I haven’t thought about it.” Raji and I wrote a white paper called TV is Next where we correctly predicted the downfall of the traditional television model due to now-common streaming. The linear television stocks got crushed in the coming years while Netflix grew its stock price and market cap to $300 billion. The tl;dr version: if a company or a smart investor tells you something, it’s worth the time to do your own research and come to your own conclusion.

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[Part 2] Hedge fund: What is a hedge fund, risks and benefits Differentiation: How Hedge Funds Stand Out Hedge funds differ from other investment vehicles in several key ways, which can be both advantages and disadvantages depending on the investor's goals and risk tolerance. 1. Flexibility in Investment Strategies: Hedge funds are not constrained by the same regulatory requirements as mutual funds, allowing them to employ a broader range of investment strategies. This flexibility can lead to higher returns but also comes with increased risk. 2. Use of Leverage and Derivatives: Unlike mutual funds, which are generally prohibited from using high levels of leverage, hedge funds can and often do use leverage and derivatives to enhance returns. While this can lead to significant profits, it also increases the potential for substantial losses. 3. Fee Structure: Hedge funds typically charge higher fees than mutual funds, often including a performance fee in addition to a management fee. The standard "two and twenty" fee structure (2% management fee and 20% performance fee) aligns the interests of the manager with those of the investors but can also lead to high costs if the fund performs well. 4. Access and Liquidity: Hedge funds are generally less accessible to the average investor due to high minimum investment requirements and restrictions on withdrawals. This limited access, combined with the potential for high returns, has led to their perception as exclusive and sophisticated investment vehicles. 5. Regulatory Environment: Hedge funds operate with less regulatory oversight than other investment funds, allowing for more innovative and aggressive strategies. However, this lack of regulation also means that investors must perform thorough due diligence before investing. Conclusion Hedge funds are versatile and complex investment vehicles offering potential benefits like diversification, expert management, and the pursuit of absolute returns. However, their distinct characteristics—such as investment flexibility, use of leverage, and exclusivity—also set them apart from traditional investment options, making them a unique choice for certain investors seeking to enhance their portfolios. #jncapital #financialplanning #valueinvesting #growthinvesting #institutionalinvestors #familyoffices #hedgefunds #InvestmentInsights #assetmanagement #familyoffices #familyofficeclub #singlefamilyoffice #wealthmanagement #fundoffunds #investmentadvisor #registerinvestmentadvisor #Endowment

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Path-dependent derivatives are a unique class of options where the payoff is explicitly tied to the entire price path of the underlying asset, not just the final price at expiry. Here are some common types of such derivatives - 1. Lookback Options ✔️ Payoff: These options base their payoff on the maximum or minimum price reached by the underlying asset during their lifetime. ✔️ Example: A "lookback call with a strike price of $100" gives the holder the right, but not the obligation, to buy the asset at $100 at expiry. However, the payoff is determined by the difference between the highest price the asset reached during the option's life and the strike price ($100). So, if the highest price reached was $120, the payoff would be $20 ($120 - $100). 2. Asian Options ✔️ Payoff: These options base their payoff on the average price of the underlying asset over a specified period within the option's life. There are variations like arithmetic average or geometric average. ✔️ Example: An "Asian call with a strike price of $50" has a payoff based on the average closing price of the stock over the past 30 days. If the average closing price during that period is $55, the payoff would be $5 ($55 average - $50 strike). 3. Barrier Options (Knock-In/Knock-Out) ✔️ Payoff: While not all barrier options are purely path-dependent, some are. These options are activated (knock-in) or deactivated (knock-out) if the underlying asset price reaches a specific barrier level during the option's life. The payoff then depends on the standard call or put option structure after the barrier is triggered. ✔️ Example (Knock-Out Call): A "knock-out call with a strike price of $40 and a barrier of $35" allows the holder to buy the asset at $40 at expiry, but only if the price never falls below $35 during the option's life. If the price touches $35 at any point, the option becomes worthless. 4. Double Barrier Options ✔️ Payoff: These options build on the concept of barrier options by having two barrier levels. The payoff is only triggered if the price stays within a specific range throughout the option's life. ✔️ Example: A "double barrier call with a strike price of $60, an upper barrier of $70, and a lower barrier of $50" allows the holder to buy the asset at $60 at expiry, but only if the price stays between $50 and $70 for the entire duration of the option. 5. Rainbow Options ✔️ Payoff: These complex options involve a basket of underlying assets and multiple strike prices. The payoff is determined based on the performance of the worst-performing asset in the basket relative to its corresponding strike price. ✔️ Example: A Rainbow Put on a basket of three stocks might have three strike prices (one for each stock). The payoff would be based on the difference between the strike price of the stock with the lowest ending price and its actual ending price at expiry. Kickstart your Quant Interview Prep Check out Quant Insider Stack - https://lnkd.in/gcfdUEfg

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Understanding Key Options #Trading Terminology for Beginners When starting with options trading, mastering the terminology is crucial for building a solid foundation. Here, we break down three essential terms—"in-the-money," "out-of-the-money," and "time decay"—to help you navigate the options market with confidence. ▶️1. In-the-Money (ITM) An option is considered "in-the-money" when it has intrinsic value. For a call option, this means the stock price is above the strike price. Conversely, for a put option, it means the stock price is below the strike price. ITM options are valuable because they can be exercised profitably. For example, if you have a call option with a strike price of $50 and the stock is trading at $55, your option is ITM by $5. This intrinsic value provides a cushion, making ITM options generally less risky compared to out-of-the-money options. ▶️2. Out-of-the-Money (OTM) An option is "out-of-the-money" when it lacks intrinsic value. A call option is OTM when the stock price is below the strike price, while a put option is OTM when the stock price is above the strike price. OTM options are cheaper to purchase because they only carry time value, not intrinsic value. However, they are also riskier, as they require the underlying asset to move significantly in the right direction before expiration to become profitable. For instance, if you have a call option with a strike price of $50 and the stock is trading at $45, your option is OTM by $5. ▶️3. Time Decay (Theta) Time decay, represented by the Greek letter Theta, refers to the reduction in an option's value as it approaches its expiration date. This concept is crucial because options are time-sensitive assets. Every day that passes reduces the amount of time available for the underlying asset to move favorably, which in turn decreases the option’s time value. For example, an option with 30 days until expiration will generally lose value at a slower rate than one with only five days remaining. Understanding time decay is vital for options traders, as it impacts the profitability of holding an option, especially those that are out-of-the-money. 📌Why These Terms Matter Grasping these concepts is fundamental for any beginner in options trading. Knowing whether an option is ITM or OTM helps you assess risk and potential profitability. Meanwhile, understanding time decay allows you to make informed decisions about when to enter or exit a trade. Building a solid foundation in these key terms will equip you to navigate the complexities of options trading, enabling you to make more strategic and confident trading decisions.

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