Millennium Management, a global investment management firm, has hired (quant) trader and researcher, Derrick Li, as a risk manager this month. According to his LinkedIn, Li has been tasked with an interesting responsibility in his new role.
Whilst Li will have the typical responsibilities of a risk manager, such as being responsible for the coverage of the equity derivatives market risk, he will also interview prospective portfolio managers and evaluate their trading strategies.
It’s not clear if Millennium Management is one of the first hedge funds to include risk managers in the hiring process but it’s not known to be a common practice. As a risk manager, Li will also be responsible for building in-house quantitative risk analytics for cross-asset volatility.
With this move, it seems as if the investment management firm is looking to mitigate trading risk before even hiring an employee. Earlier this year, the (FSB) made some recommendations to financial firms to eliminate risk. One of its suggestions included utilising employees in the risk/compliance departments to be involved when hiring new employees. However, whether the move to hire Li is in response to this is unclear.
Derrick Li’s career
Most recently, Li was a Quant researcher and trader at . Here he researched and built systematic volatility strategies. These were primarily in VIX and equity, rates, credit and commodities ETFs. He held this position from March 2016, until August 2018.
Before this, from March 2010 up until March 2016, Li worked in equity derivatives quant at . According to his LinkedIn, during the six years that he worked at the multinational investment bank, he built pricing models and trading tools, as well as provided coverage to the flow and structures volatility desks.
During his career, Li has also worked at Lehman Brothers as a Software Developer. He holds a Masters in Computational Finance and Statistics from Carnegie Mellon University – Tepper School of Business and Tulane University respectively.
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