Wednesday, October 18, 2006

Back To The Future

I recently visited the offices of CTS Trend a real-time market data technical analysis services company located in New Providence, NJ. At Seton Hall University we run the CTS suite of technical analysis solutions: Net; ViewNet; ScanNet; and, TickNet. I highly recommend the CTS for both the technical based trader and the trader/investor who desires to add technical analysis to their arsenal of trading tools.

As it turns out I spent some time with CTS President and Founder, Dr. Frank Soong. CTS is an interesting enterprise. Not only does it develop and market the technical analysis products but Dr. Soong also manages money for some large banks using his own proprietary statistical based models. Here is how the day became interesting. Early in my career when I was at Morgan Stanley I worked under Nunzio Tartaglia and Gregg van Kipnis who together pioneered “Pairs Trading” and "Black Box" statistical arbitrage trading in the 1980s. From that group came David Shaw, founder of the highly successful DE Shaw hedge fund. While also at Morgan Stanley, I worked with the team of professionals who developed the global program trading business. As Dr. Soong began to describe his trading systems and ravel off some names of people who he has worked with or subscribe to his models, it was like a flashback my early days on Wall Street at Morgan Stanley. Dr. Soong did not know or know of Nunzio Tartaglia, the very gentlemen who broke ground for people such as Dr. Soong and David Shaw. After all of these years, it is quite heart warming to see that the legacy of these early pioneers lives on in a new generation of statistical arbitrage money managers.

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