Friday, December 3, 2021
There is a sad moment in one’s life when a person realizes that their mentors and heroes are not necessarily crystal clear personalities. And according to some theories, one needs more than two parents to become a truly formed adult human, as we subconsciously seek another role model, and this could be anyone.

John Conway has formulated this idea and called the theory the “Game of Life”. The author explained that this particular name was chosen for his creation, as the ideas of it were taken from real life, with all the possibilities and scenarios included. The thought behind it was to simulate the whole life but on a much smaller scale.

Conway has unfortunately passed away in 2020 after he was infected with the virus, but his achievements will forever be remembered by the community that followed his works. Some of his fans have been dedicating their Game of Life simulations to late Conway. The main goal of a vast majority of them was to predict the outcome of the pandemic that took the life of their mentor.

We are still yet to find out, which predictions will be accurate. But let’s come back to the role models for a second… With the recent discussions related to sportspeople wages and the morality of bankers’ bonuses, we have not a lot of mainstream role models left, with the likes of Bill Gates or Jeff Bezos, or the “traditional influencers”, as Andy Samu calls them, among them. Speaking of the richest in the world, some of them have undoubtedly taken big sacrifices to grant the survival of an economy and have pumped massive funds to keep the world going.

What are the predictions?

Conway’s followers aren’t the only ones, who try to predict the outcome of the pandemic, obviously. The White House has also issued some, and so did other bodies. This changes nothing, as we still don’t know who will come out right and who will be wrong.

The same uncertainty was present in the topic of oil prices, which dropped drastically as the pandemic broke out. While the U.S. Energy Information Administration was predicting the price of a barrel to come back to $46 by the end of 2020, others would suggest a further drop to even $5 s barrel. The reality check went optimistically, as the oil price went up again and in January 2021 it passed $50 per barrel. This rise could in fact be one of the telltale signs of the Coronavirus Exit Day coming closer and closer.

Another one is the FTSE 100 score. It stood at 7,547 on the 19th February 2020, whereas a month later it fell to 4,993 points. Once again, the bounce-back came relatively quickly, as FTSE 100 went up almost 1000 points by May. The slow ascend began, and in the first quarter of 2021, FTSE 100 scored over 6,800 points.

The case of Warren Buffett

But as it appears, the pandemic is not the only reason some companies noted significant losses. Warren Buffett could not have found a worse moment to take a $5 billion hit – right before the virus broke out. According to Businessinsider, Buffett lost the above-mentioned sum on the airline stocks. This could imply that he isn’t the best quant out there, and the millions of eyes following his steps are rather sceptical if they should follow them.

We have already established that Buffett may not be number 1 on the market, but who is? Jim Simons looks like a fair candidate, as he and his team proved themselves to be quite an innovative collective. Before anyone else did so, they implemented Data Science and Algorithms to their work, and a bit of time had to fly before anyone (Government included) started following them. Simons is known for hiring the best talents in Quantitative Finance and allowing them to spread their wings.

Simons could serve as an example of how to use modern solutions to a great extent. Some of the experts and journalists refer to his abilities as superhero-like, making him an Olympian far more effective than any other analyst or trader. But he is not the greatest to learn from, as his actions are far more secretive too.

The turbulences of 2020

In his piece, Andy Samu reminds us of Matthew S Rothman’s memo under the name “Turbulent Times in Quant Land”, where the author told a tale of the 2007 financial crisis. In 2020, we got to see even more turbulent times, as Samu cleverly notices.

To read the whole piece, where Samu dwells deep into quant stories from 2020 and tries to answer the unanswered questions of 2021, please enter the following link to the article published on the Disruption Banking website: https://disruptionbanking.com/2020/04/30/turbulent-times-in-quant-land/

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