Former Hedge Fund Manager Nelson Saiers Puts His Trading Algorithm on Display

INSIDE WALL STREET Offers a Glimpse into the 2008 Crisis through the Lens of the Math and Algorithms That Run Wall Street

 

NEW YORK, April 15, 2016 (GLOBE NEWSWIRE) -- Nelson Saiers—artist, math Ph.D., and former hedge fund manager—walked away from Wall Street roughly a year ago.  His art exhibition at HG Contemporary Gallery, 527 W 23rd Street in New York City, uses parts of his actual hedge fund trading algorithm to comment on the Financial Crisis of 2008, Madoff, and other large-scale financial motivators and events.

 

INSIDE WALL ST provides a social and historical discourse on Saiers’ experience as a proprietary trader in 2008 and explores the reasons behind the rarest of events in financial markets—crashes. Using mathematical and mythological analogy and snippets of his trading algorithm, Saiers delivers commentary on the factors and events that create market failures. Saiers includes historical events ranging from the tulip bulb bubble to Madoff, and philosophical and mythological concepts from Icarus and Midas to the mortality of man.

 

The figures used throughout the pieces are symbols formed from the actual algorithmic code that Saiers used for his trading strategy as CIO of New York based hedge fund, Saiers Capital.  The process to transform the code into colorful shapes includes braille and several numbers fundamental to finance including Euler's number ("e"), and the square root of π. The choice of black as the predominant background for the artwork points to the importance of algorithmic "black boxes" in modern finance.

 

One of the pieces, titled “We’re Not in Kansas Anymore,” draws on the experience of Dorothy and her little dog, Toto, landing in a strange and unexpected world after being swept up by a tornado.  New York City experienced its own bizarre transportation in the same week that its strongest tornado on record touched down in Brooklyn. The week of August 8, 2007 also saw the credit markets lock up—the first domino was beginning to fall that would lead to the financial crisis of 2008.  The domino in the piece actually spells IG (short for the investment grade index) in braille, which points to the credit market being the cause of the crisis that would put most global banks in jeopardy of bankruptcy—the most insane financial event in 80 years. The choice of braille points to the market’s blindness to these strange happenings. Hidden in black ink are personal notes from Saiers, who was trading during this period.   

 

Another piece, titled “Yo Cuz”, centers on the events leading up to World War I. Archduke Francis Ferdinand was assassinated by a Serbian terrorist after his driver made a wrong turn.  The resulting aggression between Serbia and Austria-Hungary drew two of their allies, Germany and Russia, into the conflict.  A series of wires, which Saiers has editorialized into an iMessage chat, between their respective leaders, Kaiser Wilhelm and Czar Nicholas (who were first cousins), failed to prevent the bloodbath that cost 30 million people their lives and caused the closure of almost every global exchange on July 31, 1914.  The snippets of Saiers’ algorithm in the piece raise questions about where the VIX should have been on that day given the nonstandard uncertainty of World War I, the inability to know a particular option’s true maturity, and the inability to hedge option gamma—all within the frame of this human tragedy.

 

Gallery hours are Tuesday to Saturday, 11am-7pm.  The show closes on May 3, 2016.