$26 billion Coatue is down one of its top alternative-data buyers after the firm’s quant fund that relied heavily on the unique datasets was rocked by market volatility earlier this year

Summary List Placement

Coatue — the long-running hedge fund of billionaire Philippe Laffont that manages $25.8 billion in assets — has lost one of its top people in charge of buying the data many consider to be the lifeblood of equity-focused hedge funds.
Dave Schwartz, a vice president focused on data acquisition and strategy, is no longer at the firm, sources tell Business Insider. It is not clear if Schwartz was dismissed by Laffont or if he left on his own accord. Coatue declined to comment, while Schwartz did not immediately return requests for comment.  
Schwartz’s role, which nearly all funds Coatue’s size now have, is to vet and bring in alternative data streams that will help portfolio managers and analysts project market moves before more traditional numbers, like earnings and jobs reports, are released. The multi-billion alternative data space has been even more important during the ongoing pandemic, as investors are scouring data feeds for a sign of life returning to normal. 
Prior to joining Coatue in late 2018, Schwartz spent nearly three years in a similar role at Ken Griffin’s Citadel, according to his LinkedIn, and also worked at ITG.
See more: POWER PLAYERS: Meet the alt-data leaders at big-name investors like Point72, Bridgewater, and Man Group
Coatue’s data science team, led by Alex Izydorcyzk, is well-regarded in the industry, with more than two dozen people on it. But it ran into some speed bumps this year when the team’s young quant fund was unable to keep up with the market volatility caused by the coronavirus in the spring. 
The roughly $350 million quant fund relied on its data-driven algorithm to make its investment calls, and the pandemic skewed many of the feeds it relied on. For instance, e-commerce data, which spiked in the spring when physical store locations closed, only showed part of the story of the pandemic reality — sending signals to buy stock in struggling retailers whose physical stores were shut to customers. 
The fund, which lost money in the fourth quarter of last year, pulled back significantly from the market in the months after the pandemic hit, and then in June Coatue closed it altogether to investors and returned its outside capital.
Have a tip or know more about Coatue’s quant efforts? Reach the authors directly at bsaacks@businessinsider.com or amorrell@businessinsider.com. To message them via encrypted chat, visit their author pages. 
See more: Coatue and Fidelity are early adopters of $12.4 billion startup Snowflake’s new data exchange — here’s why they think it can transform Wall StreetSEE ALSO: Coatue is returning all outside capital in its $350 million quant fund after computer-driven trades broke down in extreme market volatility
SEE ALSO: Coatue’s $350 million quant hedge fund pulled money out of the market in a move that exposes the dangers of data-driven trades
Join the conversation about this story » NOW WATCH: Here’s what it’s like to travel during the coronavirus outbreak
Read More

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: