DRW hired an ex-Goldman Sachs MD that replicated strategies of trading firms
Quantitative Investment Strategies (QIS) teams in banks make money in multiple ways, most infamously by replicating established strategies from hedge funds and trading firms. A Goldman Sachs MD who spent 13 years in QIS no longer has to watch from outside.
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Javier Rodriguez-Alarcon has joined Don Wilson's electronic trading firm DRW as a London-based managing director. According to its most recent accounts via Companies House (for 2024), DRW has over 300 people in the UK and pays over $320k on average. Alarcon joins from XBTO, a digital asset prop trading firm where he was CIO, but spent the bulk of his career at Goldman Sachs.
For 13 years, Rodriguez-Alarcon was EMEA head of the bank's quantitative investment strategies (QIS) team. These teams replicate trading strategies of hedge funds and trading firms, but are packaged as swaps or structured notes to make them more attractive to banking clients. At the time Rodriguez-Alarcon left Goldman in 2023, Bloomberg reported that QIS trades had a volume of $370bn. Goldman's QIS team was multifaceted; the FT reported in 2017 that it also provided tax-efficient structured products and had a 'smart beta' business investing in specific market factors or characteristics.
Interestingly, SocGen said last year that its own QIS strategies are becoming popular not just with pension funds and larger clients, but with the hedge funds whose strategies are being copied.
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