Nerds on Wall Street: Math, Machines, and Wired Markets

Introduction

I hope people think of this book as sort of a Hitchhiker's Guide to Wired Markets. There are no robots parking cars for six million years, but there are robots trading millions of shares in six milliseconds, so maybe that's close enough.

In 2006, I got a call from another nerd on Wall Street (NOWS), Rich Lindsey. At the time, Rich was president of Bear Stearns Securities (Bear Stearns' prime brokerage company) and a member of the board of the mother ship firm. I had met him nearly 10 years earlier when he was in charge of market surveillance at the New York Stock Exchange (NYSE). A former Yale professor, Rich is a veritable poster boy for nerdy Ph.D.'s who break out of the pure geek world to become general all-around Wall Street BSDs.^[] He was putting together a book called How I Became a Quant: Insights from 25 of Wall Street's Elite, and invited me to write a chapter. Proceeds were going to the Fischer Black Foundation for needy students. I knew this was for real, and not like those offers high school kids get to be in the Who's Who of American Teens, and then they have to buy five copies. Plus the book had the kind of flattering title that gets people to write for free, but is more subtle and less of a bald-faced lie than, say, Insights from 25 of Wall Street's Hottest Hunks. No one does a free chapter for Another Bunch of Middle-Aged Financial Guys.

The other people writing for the book included some of the smartest kids on the block and some old friends, so I ...