work

Intellectual Property

A blog post earlier this month on Econlog finished off with a very strong quote by Friedrich Hayek:

One of the forms of private property that people cherish most is their ideas. If you convince them that their ideas are wrong, you have caused them to suffer a capital loss.

I ended up liking it so much that I added it to my work email signature. Thinking about it further, why is it that some people are more open to debate than others? Why do some people admit to their mistakes easily while others are dogmatic about them? Why do some people simply refuse to discuss their ideas with other people? I think Hayek’s observation offers a clue.

Let us consider two people – Mr. Brown and Mr. Green. Mr. Brown believes in diversification, and his investments are spread across several financial instruments, belonging to different categories, with a relatively small amount of money in each of them. For purposes of this analogy, let us assume that no two instruments in his portfolio are strongly correlated with each other (what is strong correlation? I don’t know. I can’t put a number on it. But I suppose you get the drift)

Mr. Green on the other hand has chosen a few instruments and has put a large amount of money on each of them. It is just to do with his investment philosophy, which we shall not go into, as this is just an analogy.

Let us suppose that both Mr. Brown and Mr. Green held Satyam stock on 6th January 2009. They were both invested in Satyam according to their respective philosophies – and the weightage of Satyam in their respective portfolios was also in line with their philosophies. The next day, 7th of January, the Satyam fraud came out. The stock crashed to a tenth of its value. Almost went to zero. How would our friends react to this situation?

Mr. Green obviously doesn’t like it. A large part of his investments has been wiped out. He has become a significantly poorer man. For a while he will be in denial about this. He will refuse to accept that such a thing could happen to one of his chosen stocks. He will try to convince himself that this fall (a 90% fall, no less) is transient, and the stock will go back to where it once was. As days go by, he realizes that his investments have been lost for ever. He is significantly poorer.

Mr. Brown will also be disappointed by the fall – after all, he too has lost money in the fall. However, his disappointment is mitigated by the fact that the loss is small compared to his portfolio. There have been other stocks in his portfolio which have been doing well, and their performance will probably absorb the Satyam losses. Some of the stocks in his portfolio may also be fundamentally negatively correlated with Satyam, which means they will now gain. There is also the possibility that the Satyam fall has opened up some new possible areas of investment for Mr. Brown, and he might put money into them. It is much easier for Mr. Brown to accept the fall of Satyam compared to Mr. Green.

So you replace stocks by ideas, and I suppose you konw what I am gettting at. The degree of openness that people show with respect to an idea they have varies inversely with the share of this particular idea in their “idea portfolio”. The smaller the proportion of this idea, the lesser will be the “capital cost” of their losing the idea. And hence, they will be more open to debate, to discussion, to letting someone critically examine their ideas. If the proportion of this particular idea in their overall portfolio is large, there will obviously be resistancce.

A corrolary of this is that when someone possesses a small number of ideas they are more likely to be dogmatic about them (I am using the indefinitive “more likely” here because even when you have a small number of securities in your portfolio, your exposure to some of them will be really small and so you’ll be less unwilling to lose them. Though I must point out that people with small ideas portfolios become so used to madly defending the big ideas in the portfolio that they start adopting the same tactic for the smaller ideas in their portfolio and become dogmatic about them – which is irrational).

I just hope I didn’t cause you a capital loss by writing this. For me, on the other hand, this was a bonus stock.

Stud and Fighter Instructions

My apologies for the third S&F post in four days. However, this blog represents an impression of the flow of thought through my head, and if I try to time my thoughts to suit readers’ interests and variety, I’m afraid I may not be doing a very good job.

I came across this funda in one of the “sub-plots” of Richard Dawkins’s The God Delusion, which I finished reading two days back. Actually, there is another post about the main plot of that book that I want to write, but I suppose I’ll write that some other day, maybe over this weekend. So Dawkins, in some part of the book talks about two different ways of giving instructions. And thinking about it, I think it can be fit into the stud and fighter theory.

I must admit I’ve forgotten what Dawkins used this argument for, but he talks about how a carpenter teaches his apprentice. According to Dawkins, the carpenter gives instructions such as “drive the nail into the wood until the head is firmly embedded” and contrasts it to instructions which say “hold the nail in your left hand and hit it on the head with a hammer held in the right hand exactly ten times”. By giving instructions in the former way, Dawkins argues, there is less chance of the apprentice making a mistake. However, in case the apprentice does err, it is likely to be a significantly large error. On the other hand, with the latter kind of instructions, chance of error is higher but errors are likely to be smaller.

A set of “stud instructions” typically tell the recipient “what to do”. It is typically not too specific, and lists out a series of fairly unambiguous steps. The way in which each of these smaller steps is to be accomplished is left to the recipient of the instructions. Hence, given that each instruction is fairly clear and unambiguous, it is unlikely that the recipient of the instructions will implement any of these instructions imperfectly. What is more likely is that he goes completely wrong on one step, maybe completely missing it or horribly misunderstanding it.

“Fighter instructions”, on the other hand, go deep into the details and tell the recipient not only what to do but also how to do what to do. These instructions will go down to much finer detail than stud instructions, and leave nothing to the reasoning of the recipient. Obviously the number of steps detailed here to do a particular piece of work will be significantly larger than the number of steps that a set of stud instructions. Now, the probability that the recipient of these instructions is likely to make a mistake is much larger, though the damage done will be much smaller, since the error would only be in a small part of the process.

Dawkins went on to give a better example than the carpenter one – consider an origami model of a boat on one hand, and a drawing of a boat on the other. Origami gives a set of precise and discrete instructions. Drawing is as good as a set of “continuous instructions”. Dawkins talks about experiments where kids are made to play a version of “chinese whispers” using the origami and the drawing. I won’t go into the details here but the argument is that the stud instructions are much easier to pass on, and the probability of the tenth kid in line producing a correct model is really high – while in case of a drawing, there is a small distortion at each and every step, so each final model is flawed.

Stud and fighter instructions have their own set of advantages and disadvantages. Fighter instructions require much more supervision than do stud instructions. Stud instructions enable the recipient to bring in his own studness into the process and possibly optimize one or more of the sub-processes. Fighter instruction sets are so-finegrained that it is impossible for the recipient to innovate or optimize in every way. To receive a set of stud instructions, the recipient may need to have certain prior domain knowledge, or a certain level of intelligence. This is much more relaxed in case of fighter instructions.

I personally don’t like supervising people and hence prefer to give out stud instructions whenever I need to get some work done. However, there was one recent case where I was forced to do the opposite. There was this IT guy at my company on contract and I was supposed to get a piece of code written from him before his contract expired. Given the short time lines in question, and given that he didn’t have too much of a clue of the big picture, I was forced to act micro and give him a set of fighter instructions. He has ended up doing precisely what I asked him to do, the only problem being that he has written code in an extremely inflexible and non-scalable manner and I might have to duplicate his effort since this bit now needs generalization.

I have noticed that a large majority of people, when they have to give out instructions spell it out in the fighter manner. With a large number of micro steps rather than a small number of bigger steps. And until the recipient of the instructions has got enough fundaes to consolidate the set of micro-instructions he has received into a natural set of bigger chunks, it is unlikely that he will either be very efficient or that he will produce stuff that will be flexible. It might also be the case that a large number of people don’t want to let go of “control” and are hence loathe to give out stud instructions.

In the general case, however, my recommendation would be to give stud instructions, but have a set of fighter instructions ready in case the recipient of the instructionss wants things to be more specific.

Preliminary reading on studs and fighters theory:

Studs and Fighters

Extending the studs and fighters theory

How do i describe my job?

One of the “problems” with my job, if I can describe this as one, is that it’s tough to explain my job to a layman. There are multiple levels of disconnects here, and multiple “pitfalls”, if I can call them that. So when someone asks me about my work, it gets tough indeed to describe to any degree of accuracy while at the same time being concise, and at the same time talking in Kannada.

I am a quant at a hedge fund.

My work involves coming up with trading strategies, and then developing them to a level where I can have the ultimate fighter – a computer – to trade using these strategies. Then, I will need to figure out how the computer is going to implement these strategies and this part involves some heavy engineering work. And finally I code. Ok now I haven’t been accurately able to describe in one paragraph, writing in English, about my job. How do you expect me to describe it to the layman speaking in Kannada?

Coding is a part of my job, but I’m not a coder.

I deal with financial products – equities and equity derivatives. But I’m strictly not a finance guy – as far as I’m concerned, each security is just a time series. A time series on which I can trade and make money. In fact, apart from my short stint selling interest rates swaps in London, I haven’t really done any finance. My entire view of the markets is based on my idea that a security is just a tradeable time series. I think I should do a separate post on that. Anyways, I’m not strictly a finance guy also.

One of my degrees is an MBA. A PGDM to be precise, from IIMB. But I’m not a manager also. I don’t manage people apart from myself. I’m not sure I’ll find that interesting either – I sometimes think managing is too fighter a job for me.

And so on.

And then, I work for a hedge fund. Most people don’e have a clue what a hedge fund is. I sometimes make an approximation and tell them I work for a mutual fund. And immediately I get bombarded with questions like my opinion on whether the markets will go up or down, and about how long the recession is going to last. And then there are those who start telling their sob stories about their investments in the markets when the Sensex was at 20,000 and about how markets can’t be trusted any more.

Another level of contradiction is that I’m based in Gurgaon. All finance companies are supposed to be in Bombay, right? Surely, given that I’m in Gurgaon, I must be doing some back office kind of work?

Last night my uncle was filling up some arranged marriage exchange registration form for me. And he asked me to describe my job in a short phrase. I immediately came up with “trader” and that got quickly shot down since that would give the image of a lala sitting behind huge weighing scales. Next I tried “financial trader” and “quantitative trader”. No go.

Then I wanted the simple “quant”. My highly stud uncle himself had trouble exactly figuring that out, so fat chance anyone would appreciate that. So out again. I relaxed constraints a bit and said “hedge fund professional”. But most people wouldn’t understand “hedge fund”. “mutual fund” was no go for a written form. “quantitative analyst” was considered too country by my uncle. He then asked me my designation. “Associate” doesn’t mean anything, he said and shot that down too.

Sometimes I wonder if I’ve unnecessarily complicated life for myself by choosing the path that I’ve chosen. If I were working for some software company I could’ve just written “software” over there and all would’ve been fine. The whole world would’ve understood, or at least claimed to have understood. Or even better, if I were living abroad, I wouldn’t have even been required to say that much. I’d’ve been just qualified as a “foreign huduga”, with most people not even caring for which city I was in.

For the record, my listing application records my profession as “financial services professional”, as country as it sounds. This was the only middle ground where my uncle and I didn’t disagree. And in it went. It increasingly looks like I’ll have to put fundaes to Cesares about why the stock markets have gone down in the last one year in order for them to allow their daughters to marry me. I have half a mind to start describing Ito’s lemma the next time someone asks me where the markets are headed. I’ll probably start off describing to them a random walk. And say that it’s a drunkard’s walk. And perhaps use that to change the topic. I think I might need to start practicing this. In Kannada.

I’m a quant at a hedge fund.

Process

A couple of days back, I was debugging some code. And yes, for those of you who didn’t know, coding is a part of my job. I used to have this theory that whatever job you take, there is some part of it that is going to be boring. Or to put it in the immortal words of a brilliant co-intern at JP Morgan “chootiya kaam”. And in my job, the chootiya part of the kaam is coding. That doesn’t mean that I’m not enjoying it, though. In fact, for the first time in nine years (note that this takes me to a time before I’d started my BTech in Computer Science) I’m enjoying coding.

Coming back, I was debugging my code yesterday. It was one of those impossible bugs. One of those cases where you had no clue why things were going wrong. So I started off by looking at the log files. All clean, and no bugs located. While I was going through them, I got this idea that the strategy sheet might offer some clue as to why things aren’t doing well. Half the problem got diagnosed when I was looking at the strategy sheet. Some problem with cash management.

And when I thought looking at the trades might help. The bug was presently discovered. And then it hit me – that I’d unwittingly followed what seems like a “process”. Everything that I did had been guided by insight and instinct. Yet, the steps that I followed – 1. look at the logs; 2. look at the strategy sheet ; 3. look at the trades – seemed so much a preset process. It seemed to be like one of those things that I’d just ended up reading in some manual and following.

I realize that most “standard processes” that are followed by various people in various places are stuff that were initially not meant to be processes. They were just an imprint of somone’s train of insights. It was as if someone had a series of insights that led to a solution to whta might have been a difficult problem. And then, he realized that this kind of a process could be followed to deal with all such similar problems. And so he wrote down the process in a book and taught a set of people to implement them. The field thus got “fighterized“.

The argument I’m trying to make here is that a large number of so-called “standard processes” are just an imprint of someone’s insight. They just happened to get into place because the inventor noticed this pattern in a bunch of things that he was doing. They need not be the best way of doing what is supposed to be done. Maybe there isn’t even a single best way of doing it that might work every time.

People who are likely to have worked on processes later in their life cycle are likely to have been people who are process-oriented themselves, and given how these kind of people work, it would have been likely that they would have resisted changes that could make the process worse in the short term. They are more likely to have been incremental in their approach. With a succession of such people working on improving the process, the process of refining the process would’ve ended up taking a hill-climbing algorithm and is likely to have ended up in a local maximum.

Once again, the large changes to the process would’ve happened when someone who was willing to take a large step backward worked on them, and it is again likely that such a person would be driven more by insight rather than by process.

My hypothesis is that most processes are likely to have been largely defined by people who are themselves not very process-oriented, and who thus will expect a certain level of insight and discretion on the part of the person implementing the process. And one needs to keep this in mind while following processes. That it would be good if one were to take a critical view of every process being used, and not be afraid to take a backward step or two in process development in order to achieve large-scale improvements.

Work is not just something you do for money. Yes, what you do working from seven (in the morning) to eleven in the night counts as work. But that is not the only thing that counts as work.

Broadly defined, work is anything that you need to do at a particular given time. It doesn’t need to necessarily be unpleasant. It doesn’t need to reward you financially or otherwise. It is just something that needs to be done. It is a responsibility. It is something that you have taken ownership of. And by definition, it is unpleasant.

For example, if I have promised my mother that I’ll go out an buy vegetables this evening, that is work. If I have promised a friend that I’ll meet her for tea this evening between six and seven, that is ALSO work. Because now you know what you are going to do between six and seven in the evening today, and you can’t do anything else at that time. That part of your schedule is effectively fixed, and everything else needs to work around that.

The importance of uncertainty in life, I think, is grossly underestimated. When uncertainty is in the hands of others, it is uncertainty for you. It is inherently unpleasant. Suppose you have committted that you will do something “immediately after someone does something else”, then absolute jai. You not only have “work” to do, you are also uncertain as to when you’ll have to do that work. You will need to block a large part of your time for that, and that is inherently NED-causing.

On the other hand, when the uncertainty is in your hands, it results in “flexibility”. Suddenly, when you have a set of things to do that only need to be “collectively done” before a certain time, and the time window in question is large enough, it is not so much of work anymore. Some of the tasks maybe unpleasant, but given that you now have the choice of WHEN to do it, it is so much more pleasant.

A few takeaways from this theory:

Occasionally, when I crib to people that life has become boring and predictable, their immediate response is to ask me to take up a new hobby. Typically this is something where I’ll need to interact wit h other people – such as music classes, or dramatics, or whatever. And when you take up something where you need to coordinate with others, it becomes work.
If you make a mental decision to play cricket between six and seven in the evening every day, soon it’ll become work, irrespective of how exciting it might be. Because it gets entrenched into your (already tight) schedule. If you have the option of playing cricket every evening between six and seven, then it is fine, since it doesn’t impose a schedule
The more important thing is about work at work. All management gurus you talk to talk about team dynamics, and team play, and coordination, and focus. What they dont’ realize is that all these increases the quantum of work at work. When the interaction between team members is large, and frequent, then you have several, and frequent, “deliverables”. Which creates more “work” on top of the work that you need to do.
On the other hand, if it is a loosely held team, that interacts infrequently, and which is structured such that each person has a clearly defined piece of work and inputs and outputs, then each member of the team has so much more flexibility. It is so much less “work”.
Coming to focus, when people say you need to show focus and you need to concentrate on the one thing that you are doing, they are once again increasing your “work”. Since you need to focus on that one thing, you have zero flexibility. And that is again more “work”. A better situation is where you are balancing several things at the same time, and that gives you so much more flexibility. And when you have several things on your plate, you can put structured procrastination.
So the important thing to remember while designing a team project is to keep things flexible, and reduce frequency of interaction. Give uncerrtainty into the hands of the workers; I’m sure they’ll enjoy it. The amount of work that is there to be done cannot be reduced, but the amount of “work” that needs to be done can, and should be.

Uncertainty, flexibility, option value are all things that are in general underestimated. People assume that we live in a deterministic world. They assume that everyone else needs to do things in a deterministic fashion. And this assumption has a serious negative impact on all our lives. Yes, you might recall that the ongoing financial crisis has been caused to to understimation of uncertainty. That is just the tip of the iceberg.

Rafa and the Ranatunga Principle

Today seems to be a massive theory session. In the morning, I introduced you to the Mata Amrita Index. Now, as I write this watching the third set of (ok it’s the third set now – when I’m starting to write. for all you know, by the time I finish this, the match might be over) the Australian Open, I think it is a good time for me to introduce to you the Ranatunga Principle of energy management.

The Ranatunga principle states that:

When you don’t need to run, walk.

Yes, it is that simple. And if played an instrumental part in Sri Lanka’s victory in the 1996 Cricket world cup. Arjuna Ranatunga, the captain, was a massive guy. Yet, he was an excellent finisher, converting the ones into twos, and the twos into threes, running them hard, making everyone wonder where he managed to get so much energy and stamina from. The key to his performance was what this terriffic energy management.

He knew that the effort involved in each run wasn’t the same. There were a few that were “obvious singles” or “obvious twos” and he correctly realized that there was no point in running them faster than was necessary. And he simply walked them, saving up his precious energy and stamina for the runs that required more energy. In fact, if you recollect, the defining picture of Ranatunga in the 1996 world cup was his nudging a ball to third man and lazily walking a single.

Similarly, in tennis, due to the unique game-set-match scoring system, not all points are of the same value. Some points are more equal than others. For example, it doesnt’ matter if you lose a game at love, or if you lose it after making 30. However, certain points (break points, especially) can make a tremendous difference to the game, and it is important that you win those.

Tennis, especially of the non-grass court variety, is a highly energy-consuming game. We saw on Friday the Nadal-Verdasco game being played for almost five hours. The final also promises to go on for a similar length of time. Even on grass, as we saw in the last Wimbledon, tennis can become an endurance game. To remind you, Rafa Nadal beat Roger Federer in the final back then, taking the fifth set 9-7 (Wimbledon has no tie-breakers in the last set). It was his superior energy-management and stamina-management that saw him through that day.

It had been a long time since I had seen Rafa play, and looking at him play today, it is clear that he has understood the Ranatunga principle well. In fact, he seems to be an excellent exponent of the same. A while back, Federer was leading 40-0, and Rafa just gave up and allowed Federer to take the game, choosing to preserve his energies for more important point. I’m not saying that Rafa has been completely giving up. What I’m saying is that he seems to be doing some kind of a “value analysis” for each point, and then deciding how much energy he is willing to spend on it.

I don’t know if he is a math stud, but you don’t need to be one in order to do simple Ranatunga analysis. You can get a computer to work out the relative values of points for you depending upon the match score, and broadly remember that when you are playing. And once you have done that a few times, you will automatically be able to figure out how much effort to put into each point (remember that you don’t need to know complicated projectile physics in order to catch a ball).

A lot of managers, especially fighters, don’t like the Ranatunga principle. Their management philosophy is that you always need to be f resh, and be prepared, and if you don’t dive on a regular basis, you won’t be able to dive when you actually need to. However, the Ranatunga reply to this is that as long as you know how to dive, and have general practice in diving, you will instinctively dive when you need to, and you should make sure that you have enough energy to dive.

Extending the analogy to work, there are some managers who like to push their subordinates to meet deadlines even when it isn’t important in the larger scheme of things. Their argument here is that their subordinates should have enough experience in diving so that they can use it when they need it. The Ranatunga response to that is for the subordinate to be smart, and to see the larger picture, and to call the manager’s bluff about the criticality of the project whenever it turns out to be not critical.

Ok, so Rafa has won the third set and leads the match 2 sets to 1. If this ends up being a pure endurance 5-setter, I would put my money on Rafa. He seems to be showing superior implementation of the Ranatunga principle.

Meeting Sickness

Ok here is another reason I can think of as to why I didn’t do well in my consulting career. This is based on something I’ve been observing at office over the last week or two. I suffer from what I call as “meeting sickness”. The inability to work immediately after a meeting.

Rough empirical analysis tells me that for every meeting of N minutes that I sit through, I need another N minuts of downtime following it before I can get back to work. I don’t know why this happens to me. I don’t know if I’m having to spend too much willpower inside the meeting. Or if it is just that at meetings i get into high-intensity mode and that drains me out.

Whatever it is, in a typical consulting environment, you are expected to attend lots of meetings. If you work for a company that believes in the philosophy that all work is to be done at the client’s location (such as AT Kearney) then you have meetings throughout the day. it is only in between meetings that you get time to work, and usually the way the projects have been sold means that you can’t afford any downtime.

So that explains it. The other big reasons I’ve come up with for my failure in consulting environment are it requires a high degree of willpower which I dont’ have; and that it is an essentially fighter job. Maybe these are inter-related. Need to think on these lines and come up with something.

And if you didn’t like this post, my apologies. I had an extra-long meeting at work this evening from 4 to 7 (and had sat through three other meetings since morning). I fled immediately after, but I’m yet to recover.

Extending the studs and fighters theory

In a seminal post written over a year back, I had classified people into two, based on their working styles. I had called them “studs” and “fighters”. Studs, I had argued were people who had the knack of finding the easy way out. Who liked to work around corners, and find short cuts. And who would try to do things in as efficient a manner as possible.

Fighters, on the other hand, were supposed to be extremely meticulous, and process-oriented, and extremely hardworking. They would make up for their lack of natural talent by way of sheer hard work, and would be extremely determined in order to achieve their goals.

Today, thanks to a shared item on Google Reader by JP, I came across this article in The New Yorker. It talks about how humans get insights. The article talks about the process, or the lack of it, that leads to people getting insights. A large part of the article is a bit technical, and talks about a lot of biology. But if you can navigate through that, it offers a lot of insights on what goes into insights, and what might be needed in order to think in this sort of manner.

One major idea that is presented in this article is that insights are usually developed by the right half of the brain (for right-handed people), while most process-oriented stuff and calculation takes place in the left half. The article argues that in order to leave ourselves open to more insight, we need to take care not to focus too much of the problem. It also explains that you are likely to get your insights when you are least expecting them, such as when you are playing table tennis.

Ok, so going forward on these two lines of thought, I argue that “studs” and “fighters” can be extended to learning styles rather than as just working styles. It is the way in which the two categories of people understand things. Studs, I believe, are the people who tend to get most of their understanding by way of insights. People who are unable to put a finger on the process by which they learn a particular thing. Because of this, their thought is so unstructured that it is difficult for them to precisely and correctly follow processes.

Fighters, on the other hand, get their understanding incrementally, by following a process. They build up their understanding bit by bit. Slowly but surely. They are inherently left-brained people, and because their learning style is so processed and orderly, they thrive in orderly environments. Where all you need to do is to come together and go through a process. They are willing to work hard. They don’t mind if what they are doing is not insightful (partly because they experience insights so rarely). And thus lead low-volatility lives.

One other important insight from this article is that you are not consigned to a career in liberal arts or related fields if you are a right-brained person, as a number of people would like to convince you. Popular belief is that people who are good at math are inherently left-brained, and those good at languages are inherently right-brained. And that the paths for these people are disjoint. And they should stick to what they are good at.

However, what you might want to infer from this article is that all that it means by being right-brained is that you survive on insights. And that you are more likely to be a stud than being a fighter. The old school used to say that engineering is for the left-brained because they saw engineering as being process-oriented. And they saw the liberal arts as being insight-oriented. However, there are enough instances to show that the complementary skill is also important in both kinds of fields. You need studs in engineering, for if everyone would just follow the processes, there wouldn’t be anyone to think out of the box and come up with new stuff. You do need fighters in the arts, for on many occasions it’s a sheer execution game.

In any case, I would advise you to go read the article. It’s longish, but offers important insights. And if you think you are an insight-driven person, as I think I am, it might help to show this article to your bosses, and explain to them that making you focus may not exactly be the best thing to do in the interest of the firm.

On Being a Geek

I’ve always been a “topper types”. I started topping class when I was in first standard (and no, they didn’t announce ranks before that), and as if that wasn’t enough, my parents made sure that all relatives, and all teachers in school knew about my superhuman arithmetic skills. And as if even this wasn’t enough, I became the first guy in my class to wear spectacles. In a few years’ time, I went on to represent my school in supposedly intellectual pursuits such as quizzing and chess. I had been consigned to living life as a geek.

There were several occasions when I wasn’t really the topper; wasn’t even close to being a topper. However, something or the other ensured that I managed to maintain that geeky aura. In school, and at IIMB, I was supposed to be really good at math, and that made me geeky. Things were differnet at IIT – since a number of my classmates who trumped me in acads were also better than me at other geeky things. However, I think the fact that I was studying CompSci made me feel geeky, and I never lost any opportunity to show off my geekiness.

In this context, the last two years were quire awkward, as I was in a couple of non-geeky jobs. For the first time in almost twenty years, I had to go out of my way to demonstrate my geekiness, and given that those jobs didn’t need me to be a geek, things didn’t go quite well. I used to try and shove in lines into my conversation such as “we used to play chess in the classroom at IIT. since we couldn’t carry in chessboards, we used to imagine a board and play on that”.

It was very awkward. Thinking back, maybe that was one of the major contributing reasons to my not being too happy in the jobs. I wasn’t able to play my natural game. I had to invent a new me that would go to work daily. And it wasn’t just about the geekiness factor, but this was one of the important reasons, I believe.

Now, working as a strategy guy in a quant hedge fund, I feel I have every right to be geeky, and am well and truly back in form. I lose no opportunity to crack geeky jokes. I try to bring in analogies from various geeky fields I’ve been acquainted with – math, computer science, finance, and even physics. And I don’t mind making things complicated just so that I can slip in that geeky analogy that I think is “beautiful” and “elegant”.

Two days back, i was talking to Baada on the phone, and I smelt an opportunity to crack a geeky joke. We were discussing football while watching Liverpool play Chelski. And then suddenly I asked him if he knew the concept of inversion in geometry. When he replied in the negative, I spetn the next ten minutes explaining the concept to him, all so that I could slip in that one little geeky joke.

Beware of me, I would say.

Bloomberg Watching

Two weeks back we were all given dual screens at office. A couple of days after that, those of us that had joined recently got Bloomberg logins. It’s a very restricted version of Bloomberg, with most of the strong features having been disabled. One feature that is enabled, though, is to get the graph of the daily price movement of a security, or an index.

It is necessary to have hobbies at work. It is humanly impossible to concentrate solely on the work for all the eight or ten hours that you spend at office. You need distractions. However, in order to prevent yourself from being too distracted, it helps having one or two very strong distractions. Distractions which can crowd out all other distractions. They can be called “office hobbies”.

In the past, my office hobbies haven’t really been constructive. In my first job, I was part of a PJ Club, and we would exchange horrible jokes. By the time I got to my next job, I had been addicted to Orkut, and kept refreshing it to check if I’d gotten any new scraps. Of course, when there is a cricket match on, the Cricinfo screen makes for a good office hobby. In the last ten days, the World Chess Championship has served my evenings well. However, it is important to have a sustainable hobby which could also be constructive. One which might have a small chance of making impact on your work. And most importantly, it would be ideal if the boss doesn’t really disapprove of your office hobby.

For the last week and half at work, my right screen (remember that I have two screens) has been reserved for Bloomberg Watching. A Bloomberg window is open there in full size, and I would’ve usually put the daily movement graph of the Nifty there. And it updates real-time. It’s like a video game. I just sit and watch. And get fascinated by the kind of twists and turns that the markets take.

Twenty years back, I would spend my evenings in the courtyard of my grandfather’s house in Jayanagar watching ants move about. I would be fascinated by their random, yet orderly movements. I would spend hours together watching them.

Around the same time, I used to play another game. I used to splash water on the (red-oxide coated) walls of my loo, and watch the different streams of water flow down as i crapped. I would get fascinated by the patterns that the water droplets would form, the paths that they would take, the way they would suddenly change speed when they intersected, and so forth. I would end up squatting there long after I’d been done with my crap.

So what I’m doing now is not exactly new. I just watch a point move. Orderly from left to right. Wildly fluctuating in the up-down direction. I look at the patterns and try to guess which animal they look like, or which country they look like. I get fascinated by the sudden twists and turns that the curve takes, and wonder about the collective wisdom of all market participants who are faciliating such movement. I occasionally scream out to my colleagues saying stuff like “nifty below 2600!” and they respond with a “behenchod…” or some equivalent of it.

As the day wears on, I realized that some animals I had recognized earlier in the day are hardly visible now. They are but specks in the larger graph that is the day. And then I realize that unless there was something truly special, the movement of the day will also soon be lost. It will be available for download from the same Bloomberg terminal but that will be about it. And so forth.

Occasionally I catch some unsuspecting soul on my GTalk list and spout such philosophy. I tell them about how after a while everything becomes insignificant. About how we will always be just small players in the larger system. The smarter among them will add their own philosophy to mine, and sometimes we come up with a new theory. The not so smart among them – they will ask me about my views on the market. And what would be good picks (this has been a regular question I’ve been asked ever since I got back into the finance industry but more about that later). And then they say something like how terrorists are the reason the stock markets are plunging, and how the government should protect investors’ money and stuff.

Some day I hope all of this will be useful. Some day I hope my eye for recognizing animals and countries where none exist will enable me to come up with some earthshaking strategy, which can make millions for my fund. However, now that doesn’t matter. All that matters is the unbridled joy of watching the ticker move up and down. Rise and fall. Take baby steps, and the occasional giant leap. It’s surreal.