Millennium Management Hires Quant Trader Derrick Li as Risk Manager

Millennium Management, a global investment management firm, has hired Derrick Li, a quantitative analysis (quant) trader and researcher, as a risk manager this month. According to his LinkedIn profile, Li has been tasked with an interesting responsibility in his new role.

On top of the typical responsibilities of a risk manager, such as overseeing coverage of the equity derivatives market risk, Li will also interview prospective portfolio managers and evaluate their trading strategies.

It’s not clear if Millennium Management is one of the first hedge funds to include risk managers in the hiring process but it's not known to be a common practice. As a risk manager, Li will also be responsible for building in-house quantitative risk Analytics Analytics Analytics may be defined as the detection, analysis, and relay of consequential patterns in data. Analytics also seeks to explain or accurately reflect the relationship between data and effective decision making. In the trading space, analytics are applied in a predictive manner in an attempt to more accurately forecast the price. This predictive model of analytics generally involves the analysis of historical price patterns that are used in an attempt to determine certain price outcomes. Analyt Analytics may be defined as the detection, analysis, and relay of consequential patterns in data. Analytics also seeks to explain or accurately reflect the relationship between data and effective decision making. In the trading space, analytics are applied in a predictive manner in an attempt to more accurately forecast the price. This predictive model of analytics generally involves the analysis of historical price patterns that are used in an attempt to determine certain price outcomes. Analyt Read this Term for cross-asset Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term.

With this move, it seems as if the investment management firm is looking to mitigate trading risk before even hiring an employee. Earlier this year, the Financial Stability Board (FSB) made some recommendations to financial firms to eliminate risk. One of its suggestions included utilising risk/compliance department employees for hiring new employees. However, whether or not Li's hire is in response to this is unclear.

Derrick Li’s career

Most recently, Li was a quant researcher and trader at Nomura. Here he researched and built systematic volatility strategies. These were primarily in VIX and equity, rates, credit and commodities ETFs. He held this position from March 2016 until August 2018.

Before this, from March 2010 up until March 2016, Li worked in equity derivatives quant at Barclays Capital. According to his LinkedIn profile, during the six years that he worked at the multinational investment bank, he built pricing models and trading tools, as well as providing coverage to the flow and structure volatility desks.

Li also worked at Lehman Brothers as a software developer. He studied at Carnegie Mellon University - Tepper School of Business and Tulane University.