“I will gouge out your m***********g eyes…”
Fletcher
The term “alpha-cution” was conceived in the back of taxi on 5th Avenue in New York City in 1998 shortly after an epiphanic meeting with Andy Sterge’s quant team at BNP CooperNeff. It wasn’t the typical form of copulation one might occasionally find – or experience – in the back of a New York taxi from that era, but more of a linguistic marriage of concepts: With increasing adoption of technical leverage, the temporal gap (and therefore the costs incurred) between the discovery of theoretical alpha and the capture of that theoretical alpha was collapsing. Thereafter, alphacution came to embody the evolution and impacts of technical leverage in capital markets, at least, to me.
Besides, people seemed to like the word…
Now, it wasn’t a straight line between that revelation and what many of you have been finding here on this site over the recent past. Far from it. Founded in 2004, the first mission of the company – Alphacution (1.0) – was to assemble, normalize, and display the myriad sources of data that are catalytic to changes in volatility for the combined purposes of trading and research. Along with personal resources (all of them), seed money was raised and a prototype was developed. Then 2008 happened, the project burned out, and I lost everything – and then some. The Captain going down with the ship, and all that. (As a consolation prize, the U.S. Patent Office awarded a patent for “an event-driven trading analysis and volatility prediction interface and system” in 2009.)
Unbeknownst to me at the time, the “abyss” phase of the classic “hero’s journey” narrative had begun…
I’ll save the details of that phase – and the subsequent “transformation” and “atonement” phases of that journey – for the a book (someday), with the exception of a shout out to Larry Tabb for providing an opportunity to dig myself out of that abyss. Turns out, with my congenital case of delusions of grandeur still left uncured, I would voluntarily return to that abyss, beginning 2015, to repurpose Alphacution (2.0) for what would follow. Inspired, in part, by the movie, Whiplash – a vivid metaphor for the interplay between the sometimes cruel crucible of life (Fletcher) and the relentless pursuit of excellence (Neiman) – with a tip of the hat to my own musical roots, Alphacution Research Conservatory was (re-)born…
It was also a little too prophetic, by the way, that J. K. Simmons – the actor behind Shaffer Conservatory of Music bandleader, Terence Fletcher – grew up in my hometown…
Sure, it may seem strange, uncomfortable, pretentious – pick a word – to be laying the story out this way, but I’m betting that that raw, leave-it-all-out-on-the-field dynamic is why you’re still reading. Certainly, I believe it’s why most everyone else is still paying to consume what is being served up over here. For a while now, I’ve been solving a complex puzzle that no one has ever solved before, with data that is lying around for free (hiding in plain sight), and then narrating an interpretation of the pictures that are forming as the puzzle is being solved. Part magic trick, part mystery novel, part performance art, part Jackass stunt – no one is really sure what will be discovered next. That’s part of the shtick and the magnetism…
Plus, it turns out, market macro-structure research – and its tendency to provide competitive and navigational intelligence drawn from some of the most secretive corners of the market ecosystem – is timely, and therefore, valuable to a growing roster of leading market actors and their key stakeholders…
Anyway, that’s perhaps more than enough preamble. Here’s the punchline: Recently, I needed a reference for something. So, I reached out to Alphacution’s first enterprise subscription client to serve as that reference, but did not provide any coaching nor solicit a specific response…
He agreed.
Here’s what happened next (from August 3, 2021):
Until next time…
