Seven Eight Capital Company Profile

Background

Seven Eight Capital, founded in 2012 by Stephen Cash and Adrian Sisser, is an alternative asset management firm specializing in quantitative trading strategies. The firm applies mathematical, engineering, and computer science principles to financial markets, emphasizing a disciplined, scientific approach to investment. With a mission to maximize capital appreciation, Seven Eight Capital focuses on trading equity securities, futures contracts, options, and other financial instruments. The firm has established a significant presence in the industry, managing a portfolio exceeding $1 billion.

Key Strategic Focus

Seven Eight Capital's strategic focus centers on developing and implementing sophisticated quantitative trading strategies. The firm leverages proprietary machine learning methods and extensive data analysis to validate hypotheses and generate alpha. Key technologies include unique data management and visualization tools, as well as distributed computing systems, enabling the firm to handle complex market conditions efficiently. The primary markets targeted encompass U.S. and Japanese equity markets, where the firm has a proven track record of delivering superior risk-adjusted returns.

Financials and Funding

As of December 31, 2019, Seven Eight Capital managed approximately $1.97 billion in regulatory assets under management (AUM) on a discretionary basis. The firm's estimated annual revenue is $6.5 million, with a revenue per employee of approximately $181,600. The firm has experienced consistent growth, with a 9% increase in employee count over the past year.

Technological Platform and Innovation

Seven Eight Capital distinguishes itself through its advanced technological infrastructure and innovative methodologies:

Proprietary Technologies: The firm employs unique data management and visualization tools, along with distributed computing systems, to process and analyze vast datasets efficiently.

Scientific Methods: A disciplined application of the scientific method underpins the firm's success, utilizing proprietary machine learning techniques to validate trading hypotheses and produce alpha.

Leadership Team

Seven Eight Capital's leadership comprises experienced professionals with extensive backgrounds in finance, mathematics, and computer science:

Stephen Cash: Co-Founder and Co-Chief Executive Officer. Prior to founding Seven Eight Capital, Stephen co-managed the Statistical Arbitrage Group at IVC Americas and served as a quantitative trader at Lehman Brothers and Bank of America Merrill Lynch. He holds a BS in Finance with a minor in Mathematics from Fordham University and an MS in Computational Finance from Carnegie Mellon University.

Adrian Sisser: Co-Founder and Co-Chief Executive Officer. Before establishing Seven Eight Capital, Adrian co-managed the Statistical Arbitrage Group at IVC Americas and worked at SCT Capital Management, implementing high-frequency trading strategies. He earned a BA in Computer Science and Chemistry from Duke University and an MS in Computational Finance from Carnegie Mellon University.

Adam Kravetz: Chief Operating Officer. Adam oversees the firm's operational functions, ensuring efficient and effective management of resources.

Puneet Batra: Chief Investment Officer. Puneet leads the firm's investment strategies, focusing on portfolio research and development.

Jing Hua: Chief Compliance Officer. Jing is responsible for ensuring the firm's adherence to regulatory requirements and internal policies.

Competitor Profile

Market Insights and Dynamics: The quantitative trading industry is characterized by rapid technological advancements and increasing competition. Firms in this sector leverage complex algorithms and high-speed data processing to execute trades, enhancing market efficiency and liquidity. The market is expected to continue growing as more institutions adopt algorithmic trading strategies.

Competitor Analysis: Key competitors include Dynamic Wealth Advisors, Mercer Advisors, and Tortoise. These firms focus on various investment strategies, including quantitative trading, financial planning, and advisory services. Notable achievements among competitors include successful implementation of quantitative strategies and significant growth in assets under management.

Strategic Collaborations and Partnerships

In 2012, Seven Eight Capital formed a strategic relationship with The Schonfeld Group, a firm specializing in allocating capital to hedge funds. This partnership has enabled Seven Eight Capital to expand its market presence and leverage additional resources for growth.

Operational Insights

Seven Eight Capital's strategic considerations include maintaining a transparent and collegial culture, which fosters individual and team performance. The firm's distinct competitive advantages lie in its disciplined application of the scientific method, proprietary machine learning techniques, and advanced technological infrastructure. These factors enable the firm to navigate complex market conditions effectively and deliver superior risk-adjusted returns.

Strategic Opportunities and Future Directions

Looking ahead, Seven Eight Capital aims to capitalize on emerging technologies such as artificial intelligence and machine learning to enhance its trading strategies. The firm is also exploring opportunities to expand its presence in emerging markets and form additional strategic partnerships to bolster its capabilities. By investing in talent acquisition and fostering a culture of continuous learning, Seven Eight Capital is well-positioned to maintain its leadership in the dynamic field of algorithmic trading.