Rev Cap

@DynamicMoats @acemoney21 Volume goes up when people sell No one is selling

@DynamicMoats @acemoney21 Not what it means There’s no selling happening and much of the buying is mechanical I dont think anyone is locked out. HFs took net up very quickly

Interesting

@JaredKubin @ContrarianCurse In theory yes In practice there are still many variables out of one’s control. There also are constraints But about as meritocratic as it gets

@ContrarianCurse Always drew me. The bet on yourself.

HF BONUS 101: *with all these payout posts on “revenue”… let me contextualize the multi strats for you JS is its own animal. But the multis (Citadel, Millennium, P72, BAM, Exodus, Schonfeld) all run the same flavor of comp. Siloed pods…eat what you kill payouts can run 12-25% of P&L depending on what your PM negotiated and what platform you’re on. Smaller shops quote 20%+ to pull talent. Sidenote… a lot of these “signing bonuses” you see in articles are actually loans against future comp this can be clawed back… but that’s for another post. stuff people get wrong: it’s NET P&L, not gross. Financing, borrow, Bloomberg, data, salaries, seat costs, overhead… all netted before payout. A pod doing $50M gross might pass through $15M before anyone sees a check the PM controls the splits inside the pod. If the team is on 18% and the PM runs a 6 person book, he decides what everyone gets. No formula. Some are generous. Plenty keep 70%+ and treat analysts as fungible. Biggest variable in your actual comp and nobody talks about it in interviews… get it in writing. Netting across sub sectors is real inside a team…make sure you understand! high water marks are real. Down 8% one year, you make it back before the clock restarts. Some platforms reset HWM if you get rehired elsewhere internally, some don’t. Ask 100%. deferrals. USUALLY 50% of your bonus above some threshold gets deferred 3 years and only vests if you stay. How they keep you from walking after a big year. Leave early, you eat the unvested portion unless your next shop buys you out. IF You lose money in year 2… it gets netted against deferred with no recourse. Tough. the drawdown trigger is the scary part. Most pods have a stop loss, usually 3-5% of budget, sometimes 7-10%. Hit it and you’re done. Pod cut, team fired, capital reallocated. Doesn’t matter how good your 3 year track record is. This is why a 20% payout sounds rich until … yea a senior analyst on a good pod clearing $1-3M in a normal year is realistic. PMs running their own book can do $5-20M+ in a strong year. Top decile PMs at the big shops are printing numbers that would surprise you. Flip side, median PM tenure at these places is 2-3 yrs and a real chunk of pods blow up every cycle (think NFL career length) Overall… everything is negotiable, it’s opaque, clawbacks suck, and a hard way to make an easy living

How can we be this close to the singularity and still not have a little R2D2 to do my dishes

@briangobosox @tylermacro10 @w_duby Brian. Core PCE right now is 3.2% before Iran. Every leading data point is accelerating higher before Iran. With Iran it will push much higher You can ignore reality as the Fed does but it won’t stop core PCE from printing in the 4%s for many months this year

@rev_cap @tylermacro10 @w_duby Spaghetti analysis? My ocular regression shows a low r-squared. Many spikes in the ISM measure revert without seeing any acceleration in CPI.

Guys, Iran is a stalemate No bombs. No talks. No progress. No escalation beyond oil market vol. It’s just going to be like this for a while

@briangobosox @tylermacro10 @w_duby

@rev_cap @tylermacro10 @w_duby You’re suggesting a diffusion index of manufacturing sentiment is a more representative measure than total aggregate spending?

@briangobosox @tylermacro10 @w_duby Does this look stable to you?

The Fed has “landed” the economy. Vol of nominal final sales is lowest of any 3-year period in the post-war era. So what if its at a level consistent with inflation slightly above target. They spent 2010-2019 below target. These things can’t be perfectly calibrated. Stability is paramount.

@briangobosox @w_duby This is core PCE before Iran. It’s 3.2% and moving higher Shouldn’t they just be raising rates anyways?

@w_duby @rev_cap Depends. If yields rise b/c the labor market is rebounding, then stocks will be fine. If yields rise because the Fed is going to make the mistake of tightening into a supply shock, then stocks fall.

@briangobosox Iran wants to act like they are trying to look like an adult Trump wants to act like he’s about to get a deal because he measures himself by the stock market It’s all just sideways. I don’t think it really matters for stocks but people’s views of the situation are distorted

@briangobosox Brian there’s no movement It’s all just theater

All very normal

Are we all just going to act like this is normal?