PDT Partners

PDT Partners (Process Driven Trading Partners) is a hedge fund company led by quantitative trader Peter Muller that was founded in 2010 as part of Morgan Stanley's trading division and spun out as an independent business in 2012.[1][2] It has offices in New York City and London.[3]

History

PDT Partners started out as the proprietary trading division (called the Process Driven Trading Group) of multinational financial services corporation Morgan Stanley in 1993.[4][1] According to Bloomberg, PDT's investments have returned an estimated annual average of more than 20 percent through 2010.[4]

In January 2011, Morgan Stanley announced that it would spin off its proprietary trading division into a separate hedge fund in order to comply with the Dodd–Frank Wall Street Reform and Consumer Protection Act.[4][5]

The spin-off began in 2012. In October 2012, it was announced that the Blackstone Group had put $500 million into PDT, but without seeking any equity in the hedge fund. Bloomberg.com considered this unusual and a testament to Muller's market power and ability.[2] In 2013, the spin-off was complete. In February 2013, it was announced that the fund had raised $2.3 billion in total and was beginning operations in London and Hong Kong in addition to New York City.[5]

Peter Muller (founder and CEO)

Peter Muller, the CEO of PDT, who started PDT as Morgan Stanley's proprietary trading group, was described by Bloomberg.com as an "unlikely executive", a 47-year-old math wizard, and a person with diverse intellectual interests and hobbies.[4][6] Muller graduated in mathematics with honors from Princeton University, where he was also an Ultimate Frisbee star.[4][6] He went on to work at Barra Inc., a quantitative firm in Berkeley, California. After doing contract work as a Barra representative for Renaissance Technologies, he was offered a job at Renaissance, but turned it down because his belief in the efficient market hypothesis made him skeptical of Renaissance's claimed high rate of return. In 1992, he proposed using Barra’s quantitative techniques to forecast returns rather than just model risk, so that Barra could manage money itself. His proposal was rejected, and he joined Morgan Stanley in 1993, where he created its Process Driven Trading group.[4]

Muller is also on the board of Math for America,[7] and writes the New York Times crossword puzzle a few times a year.[4]

See also

References

  1. ↑ 1.0 1.1 "PDT Partners". Retrieved August 1, 2014.
  2. ↑ 2.0 2.1 Burton, Katherine (October 9, 2012). "Muller’s PDT Is Said to Get $500 Million From Blackstone". Bloomberg.com. Retrieved August 1, 2014.
  3. ↑ "Contact Us". PDT Partners. Retrieved August 1, 2014.
  4. ↑ 4.0 4.1 4.2 4.3 4.4 4.5 4.6 Teitelbaum, Richard (July 6, 2011). "Morgan Stanley Yoga-Troubadour-Crossword-Math Pro Muller Flees". Bloomberg.com. Retrieved August 1, 2014.
  5. ↑ 5.0 5.1 Agnew, Harriet; Turner, Giles (February 5, 2013). "Morgan Stanley traders reassemble as Muller opens PDT in London". Financial News. Retrieved August 1, 2014.
  6. ↑ 6.0 6.1 Wachtel, Katya (July 7, 2011). "We've Never Been More In Awe Of Someone's Life Than We Are Of Quant Legend Pete Muller's". Business Insider. Retrieved August 1, 2014.
  7. ↑ "Peter Muller". Math for America. Retrieved August 1, 2014.

External links