Ken Griffin said this week that Gen AI can’t yet be used to generate alpha, but his hedge fund Citadel is still shoring up its compute team to capitalize on AI’s other benefits. A recent architectural hire comes from rival hedge fund Millennium.
Christopher Johnston joined Citadel a few weeks ago as its head of North America compute. He spent the last six years at Millennium serving as its head of platform linux engineering. Johnston has a background in banking, as well as stints at high-frequency trading firms including Virtu Financial and Jump Trading.
Citadel has lost senior compute people too. Last month, we reported that Scott Donovan, a 22-year Citadel alum, left for HFT firm Optiver. He held multiple similar roles to Johnston, including head of linux engineering at Citadel and, latterly interim head of compute.
Where exactly hedge funds should be doing all this computing is an ongoing debate. Speaking at Quant Strats Europe this week, Barry Fitzgerald, co-head of front office engineering at hedge fund Man Group, said that “there’s huge amounts of investment still going into on prem datacentres” from big banks and hedge funds that goes largely unpublicized. Fitzgerald said that concerns over the cost of energy to run those on-prem datacentres are somewhat overblown; “compared to the hardware that’s in there, it’s not a big cost.”
It’s not just hedge funds building out their compute. NorthMark Strategies, a performance computing firm with links to G-Research, emerged from nowhere late last year and is investing $2.8bn in a US supercomputing facility.
It’s not clear exactly how Citadel sets up its compute architecture but its sister firm, market maker Citadel Securities, signed a deal with Google Cloud last year to move its quant research compute onto the cloud.
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