With all this talk of a recession in the near future, is it safe to join a quantitative hedge fund like Two Sigma as a SWE? On the one hand, the volatility could be an opportunity for them to make more money, but seems like it could go bad too with clients pulling out their invested funds.
Is there a significant enough risk of layoffs at quant hedge funds that I should stick to FANG? I imagine being a SWE at a hedge fund might be even more risky since they're generally seen as less important than the quant researchers.
Is FANG that much safer? FB and Google make most of their money from ads, but there'd probably be a lot less businesses paying for those ads in a recession.
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In the above scenario, sure the upside is theoretically unbounded. But practically speaking, if I run a hedge fund, I would: 1) sell/unshort when my effective loss crosses a threshold, 2) in a down market, your stocks are more likely to go down than not. So how are they different from a practical perspective?
From a practical perspective you want to buy the put option, it is in the money when the stock decreases, can be sold, and your total risk is capped.
Please learn to spell “lose” before starting a hedge fund.