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What makes traders make it - Audy from Credo on edge, hiring, and crypto prop firms
125 Plays1 month ago
Audy joins the Insilico Terminal Podcast to talk about his path from solo crypto trader to operations manager at Credo, how modern crypto prop firms actually work, and what separates traders who make it from those who don’t. The episode covers hiring, track records, discipline, confidence, portfolio construction, market regimes, and why working at a fund can be a much better path than trying to make it alone.
Insilico Terminal Podcast Episode 30 - Audy, Head of Operations at Credo
00:00 Intro, Audy’s background, Bybit competition breakthrough and joining Credo
08:10 Inside the prop desk, remote trading floor, desk calls and trader freedom vs allocations
16:11 Hiring traders, track records, verifying edge and why one year can still be enough
25:42 Portfolio construction, navigating bull vs bear cycles and diversification across strategies
33:14 Why discipline fails, false signals, pressure, journaling and surviving bad periods
42:10 Crypto outlook, altcoin “cleansing”, token alignment and why the market structure is improving
49:02 Leading while trading, staying sharp yourself, handling bad months and trader morale
01:02:22 What edge really means, defining the counterparty, news trading and final hiring advice
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Transcript
Introduction and Guest Introduction
00:00:03
Speaker
you
00:00:12
Speaker
Welcome to a new episode of the InSilico Terminal podcast. Today i have a bit of a different type of guest than usual.
00:00:23
Speaker
um And what I like to do is at the beginning of the episode, I like the guests to introduce themselves. And since I also don't know too much about you, i would like to ask you to introduce yourself. Who are you What do you do?
Odi's Trading Journey
00:00:38
Speaker
Yeah, yeah. I'm glad to be here. I'm Odi. I've been trading perps since 2019. I got straight into crypto, hadn't trading and traded anything else in my life before.
00:00:51
Speaker
Like pretty much everyone, I made some money, lost some money. Eventually i had some ah breakthroughs in 2021. Like that year, I also won one of these Bybit competitions. i don't know if you remember them.
00:01:04
Speaker
In retrospect, that was somewhat of a turning point in the sense that it greatly helped with confidence, getting some more funding back then. And a few months later, end of 2021, it became my full-time job.
Role and Business Model at Credo
00:01:22
Speaker
Roughly a year later, I joined Credo, the fund prop I'm working right now. I've been there for three and a half years. Around the two year mark, aside from trading, I took on this role to manage the operational side, which mainly includes firm strategy, day to day oversight of our traders, the teams, that kind of stuff.
00:01:48
Speaker
So can you tell us a bit more about the Credo? how How does it work? What does it what does it really do? Yeah, so Credo is a prop shop, but like with a definition, more of the, you know, now prop shops is being used mostly for this type of firms that you pay an evaluation fee and they fund you, right? But traditionally, it's more like traders who trade on prop capital means the firm's money.
00:02:14
Speaker
So we hire traders, the traders don't put anything from their pocket, we give them money and there is a profit split. That's the basic structure. And then there are variations um in terms of models um and in terms of, let's say, input.
Team Dynamics and Market Focus
00:02:32
Speaker
So there are some operations which are um very individual based. So they're like, they review your your strategy, they give you the money, research, trading is all on you, good luck. You know, that kind of arrangement. And then there is um more of the style I tried to to do when I started working on the operations, which is ah more team oriented, which of course still has the same foundations, the trading, the strategies have to make sense.
00:03:00
Speaker
But there is um a big focus on the research, on um software also, co-developing the software, um sharing more insights, working in teams, that kind of stuff.
00:03:14
Speaker
How big is the team? Right now we're about 20. twenty um with some you know We have some who are more outside partners, some more inner team traders, but yeah, 20, 25.
00:03:27
Speaker
I see. and We used to be yeah we used to be ah more, around 50 or 60, but it's like you see this in every prop, you know, with a span of time, there is like ah a little bit of a churn rate.
00:03:42
Speaker
Mm-hmm. Do you like only trade crypto or also other markets? um We trade some other markets, but very, very, it's a very small percentage of our operation. Now that we have all these tokenized products, we are looking to expand maybe on this side, but it's still early to to claim something like this. Like 99% operation is crypto.
00:04:07
Speaker
what What is like the difference for ah people that are listening that don't really know what it's like to to work at a fund that have only been... Most listeners, I guess, are just like trading for themselves. So what what would you say is the difference between trading for yourself, being by yourself and working at at a firm like yours?
Advantages and Challenges of Trading at Credo
00:04:24
Speaker
Yeah, um that's a good question. I think it's way better working for a fund like this for many reasons. But um let's say a few of the most important ones I would say is ah research.
00:04:38
Speaker
That can be very useful ah for alpha, for expanding your ah system, for um anything really. Second thing is that you know um your circle is certainly profitable and talented. Like that's very important in the sense that I know so many people in chat rooms or groups which may have, you know, unprofitable people and they can misguide you. um And in prop it's the opposite. Like you know they're profitable, you'll see systems and alpha that's something different from what you do perhaps.
00:05:13
Speaker
You'll get ideas. And for sure, the last big thing is career prospects, I would say. Like um if you're good, the sky's the limit in terms of funding, in terms of while when you're a solo trader,
00:05:27
Speaker
um it's it's you need to be ah exceptional and you also need exceptional market conditions, right? um Like we've seen in crypto from time to time, there are some personalities who fit this category, but they're like a very tiny percentage and in conditions like now, you can't really make a living from trader trading that easily outside of a team as a solo trader, in my opinion.
00:05:54
Speaker
you You have complete freedom. You have no mandates as ah as a solo trader. you But this um it's almost certain to have downsides as well in the long term. um And particularly in crypto, I would say it's easy to fool yourself that you can trade full time for a long time.
00:06:14
Speaker
um Maybe I could see the opposite, like a retired fund guy trading solo. um But yeah, I firmly believe if you've never worked at the fund and you ah are an aspiring trader, you should seek to work at one.
00:06:31
Speaker
Since like you you also just joined in the beginning as a trader, right? Yes. So you really you know like both perspectives of just being a trader and then also being like the the operations manager. What's what's like the day to day life like of ah of a trader and then of what you do nowadays?
00:06:52
Speaker
um The trading is not extremely different from what you do as solo, but you have to do maybe some more work around it and you have some people guiding or supervising you, right?
00:07:04
Speaker
um Generally,
Trading Styles and Compensation
00:07:08
Speaker
i would say on the operational side, it also depends on what you give way to as a prop. It goes back to what I said about some firms running more individual-based models, some others more around the team. But um aside from some calls to um have some briefing or traders being in calls to simulate some kind of a trading desk, like a a floor I'm in, There is the side work you do depending on your team. So many are working in research on the side when the trading is quiet, some work in software and some others, a smaller amount to little tasks around the operations administrative. Obviously, there is a fundraising based dev side. But yeah, this is many times not traders doing it. So yeah.
00:08:01
Speaker
So you you don't ah have like an office where you're all together, you're you're remote or ah We do, but throughout the years, like ah most of the team now ended up being global. So we do, but even for the guys who are in the office, that this doesn't really change. We just yeah communicate through through voice.
00:08:24
Speaker
I see. So you're just like in ah in a call to like kind of Yeah, that's the feeling of being on a desk. Yeah, that's pretty typical. It's not mandatory. It depends also on the day and what kind of events you're expecting, you're actively working on something. But yeah, it's it's typical to to see this.
00:08:45
Speaker
How much freedom does like a trader have in in your company? I imagine like you you hire someone, you get someone in, and then they like keep their style of what they're doing? Or do you do you have like certain parameters that you give them in which they should operate?
00:09:00
Speaker
um Good question. I think, again, it depends on arrangements. So you can have ah almost all the freedom you want in the sense of what you will trade,
00:09:16
Speaker
um your risk, but of course in sensible limits and it can impact the kind of funding or the kind of allocation you will get. So for example, if you want to trade a very specific way with a very specific drawdown, if that can't fit to our book or it doesn't make sense, then it also makes sense, you know, from the firm perspective to not give you like an allocation to the same allocation you would give to a guy with a tiny drawdown that's uncorrelated returns.
00:09:46
Speaker
You know, so we generally try to be as flexible as possible because you can't really force, you know, if someone has alpha and the system, you know, has a positive, sharp and good data set, it's going to make money. You don't really want to touch that. But yeah. in in the context of um mixing with a book?
00:10:08
Speaker
That's the answer. I don't know if you can speak to that, but like does ah the the compensation depend on your your allocation, I guess, like on on what you've given been given as proprietary funds?
00:10:22
Speaker
um Not really, but um I can tell you what's true for the industry as a whole. like You will see as the funding goes further up,
00:10:34
Speaker
um like on asset management type of vehicles, you will get the like the most standard thing to see is 80-20, which means um only 20% of the profit is like a performance fee for you ah plus management. um So generally you might see this if you have some kind of hybrid arrangement, but no, I would say for prop it's not really that common. But again, like this types of, you know, like you have ah prop, fund management, asset management, sorry, ah this can ah overlap and you see like a lot of arrangements there.
00:11:16
Speaker
So how do you like look at someone when they try to, ah when when someone applies to to work for you and maybe you like scout them or something and see that they would
Hiring Criteria and Track Record Verification
00:11:26
Speaker
be a good fit? How do you go about like the hiring process?
00:11:29
Speaker
Yeah. um Track record is for sure the most important one, right? It's results-oriented industry. You want to see a track record that not only is obviously green, it's profitable, but it it you want it to make sense in terms of stats.
00:11:49
Speaker
um You want to see a big sample. You want to see managed drawdowns. You want to run the usual metrics you would run like Sharp and this type of. um You want to see the correlations ah to know like, is this a strat that you know is just good on a bull market or is this something that would that has alpha throughout all regimes you want to look at that um and besides that there are there are like other factors which would be important let's say more of the how you fit into the culture the business and um how you would do if you the current strategy would run out like the the its ads would run out so you know this is where we come into
00:12:37
Speaker
Again, you can't obviously tell all of this from the from the interviews, but discipline, curiosity, professionalism, experience, confidence, these are all very important i aside from the track record.
00:12:51
Speaker
How do you go about like verifying the track record? I guess it's gotten a bit easier now since yeah with stuff has moved on-chain. but the not like back yeah Before it was dextrating, you used to like check through APIs through centralized exchanges? Sorry.
00:13:08
Speaker
Yes, so you can check um if it's a centralized exchange that the trader has his strategy on, you can simply just get an API key. um And if it's decentralized, you can look on the chain, like all this analytics, you can use those. And there are API key keys there too, right? um Yeah, that's one. But this is not the only um you know precaution you want to take. Obviously, when someone starts, he starts very slow. Like what they used to do, as some are still doing, is you you start on a SIM account.
00:13:43
Speaker
um We don't do that. You start with some small amount of capital right away. um And yeah, you need a few months even just to get used to you know trading someone else money, even if it's a small amount. Somebody's watching you.
00:13:58
Speaker
You've specified your your strat. this is not ah very It sounds simple, but it's not very and it's not a very intuitive change for many people. For some, it can take you know a year to get comfortable, especially as the money gets bigger.
00:14:12
Speaker
Yeah. I don't know if this is maybe like a stupid question, but um technically a track record could be like faked, I guess. Yes. If someone just shows you one account and then then like everything that is like hatched on on another account or something like that. Is that like something you try to filter out during the their interviewing stage then? or Yes, ah for sure. And that's why also I said there is this secondary precaution, right, where you see them trading live and replicating what they told you.
00:14:41
Speaker
So obviously, if they told you you know, my system is like this and this, roughly, of course, we don't ask anybody to give their full ah strat on the interview. ah You then verify to see that the edge that it was he described falls along these lines. And obviously, like I think, after you get the experience and talk with many traders, interview some more, you can kind of tell from the get-go if someone really knows what it takes to have a profitable strategy, good risk management, and who doesn't.
00:15:14
Speaker
So we havent we haven't we haven't had this problem almost ever. Yeah. That's nice. That's nice. How long of a track record are you looking for for someone like, is it enough if someone has been trading for for a year and been doing well so far or like do you look for more experienced people?
00:15:30
Speaker
Generally more experienced, but if you come with something that's extremely strong and it makes sense, you know, like there is a system that fundamentally makes sense in the way it it extracts value, ah then even one year can be enough, especially if we are looking to... Like this depends also on what kind of phase we might be or any prop shop for that reason might be. Like, are you are you looking to expand your desk or not? So obviously, even ah if if a desk you know says, OK, we don't want to hire new traders, if somebody knocks on the door with experience on with you know five, six years for funds, has a very strong, sharp, very strong track record, um they will take him you know um most of the times.
00:16:16
Speaker
no
00:16:19
Speaker
the people that like work at at your fund um mostly just like discretionary, manual traders, or are there also quantitative types? I would say they're mostly manual.
00:16:31
Speaker
There are some quants. not Not quants, but there is this semi-algorithmic, some automations. oh We have those, but mainly click traders, yeah.
00:16:44
Speaker
I see. And everyone is like trading directional, so yeah do you don't have like any like delta neutral stuff or farming? We do. We do. Yeah, we we do have that, but it might not be exactly, you know, um quantitative, like in the sense of market making or it might be, you know, an approach that you're always hedged long short, um but you still do it with by clicking.
00:17:10
Speaker
hmm. since Since you're like in crypto, do you also um give people funds to like explore some more exotic opportunities, I guess, like if they want to play on on smaller venues, for example, or like new venues, new DEXes?
Trading Approaches and Evaluations
00:17:25
Speaker
No, we don't generally do this because um mostly because of compliance and because it might not be worth the time. um oh Yeah. I see. So just like trading on on major exchanges.
00:17:39
Speaker
Yeah, that's one of the, and I'd say we move ah relatively fast, like other fund funds can be much slower and it's understandable because the compliance is a big mess. and and Especially if you're in the US, it's also easy to to move between exchanges and yeah, you need to, yeah.
00:18:05
Speaker
We've all ah been been through the pain of many years of of compliance issues in crypto. But I guess it's getting a little bit better now. Yes, it is. it is if If the world doesn't end before all the laws get passed. but yeah so um What is it like when when people start working at your your company, like a new trader starts working there? And them how how do you gauge if he's doing well, if he's adapting to the environment?
00:18:31
Speaker
What do you look for? P&L is the most obvious answer, right? um Again, some of the things we said before about screening, you want them to see they follow what they outlined.
00:18:44
Speaker
um And when they start getting you know some positive feedback from the market, the strategy works, you size them up a little, they you know and you there is this cycle until they're fully ah comfortable.
00:18:59
Speaker
um you're looking So that's one thing. You're looking and then you're looking at um the things we said before about you know discipline.
00:19:11
Speaker
ah are they are they taking losses where they should, where they said they they would? Are they sticking to their edge? um ah do they keep working on this edge like how curious they are this is a big predictor in my experience what makes um a successful trader right people who like to to think to doubt to question a lot they usually do better so that's one thing i'm also looking at like you're you're jumping into a new hub um that has a lot of resources a lot of traders a lot of different things you'll see you should be clicking all day
00:19:47
Speaker
right like one of the most underrated um things i think in crypto is that testing is extremely cheap there are no flat commissions there are no minimum contract sizes you can go and open like ah a tiny position and track you know so many things i always say this and encourage traders to do a lot like just keep clicking on different things not it's it's a different thing than you you have to stick to your ads right but with a tiny size you can test a lot of things and I've seen it do way more good than harm.
00:20:24
Speaker
If you can like give ah give a rough number, maybe how how many people have been evaluated by you? Maybe by the company or but just by you yourself or something like that? um when i When I applied three years ago, which was like a more open round, I think they had like 3000 applications.
00:20:45
Speaker
ah whoa um But now since we like the the rounds are more close, there are much more ah stricter requirements and um also a lot of traders have exit the space. This number is smaller.
00:21:01
Speaker
Yeah, it's not in the thousands ah for sure. um Yeah, so that's the rough answer. Would you say it's more difficult nowadays to find good talent
Market Cycles and Talent Trends
00:21:13
Speaker
compared to before?
00:21:13
Speaker
For sure, for sure. I think they're not, you know, aside from the from the prop, ah there are no traders left. um the balance The ratio between retail and professional traders ah has has swung all the way to professionals, I feel like.
00:21:31
Speaker
we have a very small amount of retail traders left, especially the two perps. Like you might have some people, but they're mostly, you know, in indexes, on-chain stuff.
00:21:43
Speaker
um So yeah, it's it's very hard to to find talented people. I mean, there are a lot of people who apply in these terms, but to find talent, yeah, very rare. And it goes back to what we were saying before that it's very easy, you know, in 2021, 2022, the good years for altcoins, a lot of people convinced themselves, myself included, ah of course, in some ways, right, that they know how to trade.
00:22:12
Speaker
And obviously they did not, um yeah, they did not stay around. It's a very tough, tough market too. So. is Is that like more is that is that condition because of um like the current bear market, I guess, since like October or whatever you you want to mark as the top? Or has this also been like and a symptom in this cycle overall compared to like last cycle, you said?
00:22:38
Speaker
Both. I think both. Like, um obviously, you'll get more interest and you see it also on the trading and it reflects on the P&Ls too. It's easier to make money when you have retail phases. You'll get more applications.
00:22:51
Speaker
ah But also, yeah, with the span of the time, you just, you know there is a ah slow but exodus from the space ah for sure.
00:23:02
Speaker
um Yeah. i mean, it's it's somewhat expected, not only from a performance standpoint, but also if you look at other markets, especially besides stocks, um the ratio between professionals and retail is skewed to the professionals, especially in terms of capital, of course. Stocks got a little better ah with how popular you know stock trading and investing in an ETF has become, but yeah.
00:23:32
Speaker
We're seeing this trend where the the um crypto industry is getting more and more institutionalized in in all aspects, this included. yeah So you feel like this is like a long term trend and not, I guess it it might reverse a little bit and in the next bull market if if that's going to come around, but it's probably like still on the downtrend overall.
00:23:54
Speaker
Yeah, exactly. I would say so. um Obviously, you know, if we go to 200k, we might get a very strong revival. We might reach um the same highs of activity, but the ah opinions may vary here. But my opinion is that the altcoin space, which attracted the most retail, is in a bit of a euthanasia roller coaster like this. you You know this graph, right? Yeah.
00:24:20
Speaker
How do you deal with that as as a company?
00:24:24
Speaker
How you deal like in terms of um it it doesn't impact us that much because it's not like ah we're not making money off the traders or people who apply.
00:24:36
Speaker
um Like, you know, we have a team now. The prop makes money. If retail comes back, we will make more. But that's it. You know, it doesn't. We we have a strong base to begin with.
00:24:50
Speaker
um But if you're asking like how you navigate, you mean like how you navigate the bear markets and bull markets as a firm, as a
Risk Management and Strategic Adjustments
00:24:59
Speaker
fund? Yes, yes. um Then I guess you would look at portfolio construction and allocations, right? um You want to be cognizant of where you are in the cycle, um for sure, and that should reflect in the weighting you give to strategies that are correlated with the market versus the ones that are not. Another thing ah is the risk. You need to know when to ah you know adjust that valve. So I think, for example, this is um
00:25:34
Speaker
um we We have a good synergy there with our head of trading, Bitbit. I think he's exceptional at telling you when the risk on conditions are here. Like I remember every major breakout, either it was 32K with ah ETFs or elections. you know he's really good at telling you early you know to jump up the risks.
00:25:57
Speaker
And he's also good at telling you when things are getting frothy, to be more patient, to wait lower, that kind of stuff. And on my end, I think like ah one of the best decisions when I took over was to diversify our exposures.
00:26:14
Speaker
um This was somewhat in ah late 2024, start 2025. ah start of twenty twenty five um We had a very frothy cycle with the elections, if you remember Trump. that's um And that was like a good this decision in hindsight, of course, ah but also allowed us to do very, very well in 10.10, which, yeah.
00:26:37
Speaker
So you would these these two variables may mainly you want to to tweak and play around. And also it depends on the kind of ah another variable to this is like edge development and where you get your research.
00:26:50
Speaker
um It's important you keep finding strategies, um optimizing what you have, adjusting, these kind of things. You know you can steer the direction there.
00:27:03
Speaker
um and create an allocation a structure that makes sense ah depending on your goals and the firm the firm's goals lp's goals whatsoever you know when you when you like say diversification does it mean you diversify the strategies that you're running to be like less correlated to each other or how can i imagine that You can imagine it as if you have like if you have strategies, let's say, that are very correlated with the market and the market has been up only for months and you're seeing very strong signs signs of froth, if you're going to have another allocation round, you might want to prioritize strategies that do not correlate with the market, that have no directional bias.
00:27:49
Speaker
ah or you might want to instruct or discuss with the traders of the um ah former strategies is to take some risk off or take money out.
00:28:00
Speaker
this You want to have this high level view um investment strategy guide, you know, the decisions through the traders and the that where you allocate the money.
00:28:12
Speaker
So I guess that's like one advantage that you have as ah as a trader working for you that you kind of have like more, um i don't know what the right word is, like brain power or whatever behind you to like guide you a bit in like a direction of like tell you, hey, this is what I think where the market structure is right now. This is what I think the risk that we should take is right now and give you a bit more edge through that, I guess.
00:28:37
Speaker
Yes. Yes.
00:28:42
Speaker
What would you say is like the ah characteristic of people that um fail a lot or like that that came to to your company to try to apply and that didn't make it?
Trader Discipline and Performance Factors
00:28:53
Speaker
What is like something that that's like consistent that you see there at again and and again where it's like this is why they fail? um these are two separate questions right um if you get in it means we think you have what it takes and somewhere along that road you something did not uh um for the application side is most like what i what i saw and i did not i did not expect at all is that many people just you know they don't even uh
00:29:25
Speaker
ah strong enough of an effort to to when presenting themselves or during interviews they're not super well prepared. I mean this is typical for many jobs right but you would expect in trading which is hyper competitive to see a bigger percentage of people ah but usually you know this goes with a track record like you'll you'll see a meticulous track record usually the guy's on top of everything. Right. um On the side of like getting hired and then um being let go,
00:30:00
Speaker
it's Discipline for sure. um Obviously, you can't keep deviating from from your edge forever or doing things that are outside your risk parameters or against guidelines.
00:30:14
Speaker
and But that's pretty obvious, right? And another thing that's ah more um like a veiled you know obstacle that you're not really going to see coming until it's there. It's what we said before with curiosity. like What I've seen the most successful traders do,
00:30:32
Speaker
um is keep clicking on random stuff and why i'm mentioning this not random stuff sorry i mean random stuff in terms of you know their their main strategy uh obviously they click on stuff they see on the prop and the research but the advantage to this is that um you develop another edge or you have something more you know in some loose form that later can develop in an edge and give you a second strategy or a third one. And why I mentioned this specifically is that usually the most successful traders don't need that.
00:31:03
Speaker
Like they already make good money. Why would they go and try, you know, with 50 or 100 bucks to test how this trade is going to go? Like they don't need this at all.
00:31:13
Speaker
then then The generic advice is if anything, like stick to what you're doing. Do not look, you know, um outside that that scope at all. While some other traders i've I've seen, they're very stubborn with trying to make something work.
00:31:29
Speaker
It might work, it might not. you know At some point, it's more or less certain your edge is going to decay. And if you haven't done the homework that just mentioned, ah you're going to find yourself with no edge working from zero for something else. And you're going to be many months unprofitable. And yeah, I mean,
00:31:52
Speaker
I see. but why Why do you think like people lack discipline? You mentioned a lot that people people aren't disciplined enough and that's why they've been let go. what Why do you think they struggle with that?
00:32:04
Speaker
um It's fundamentally very hard, I think, especially in this today's age. right There are way too many distract distractions. It's just hard to be consistent. And mainly, I would say specifically for trading, it's very hard to navigate behaviorally. like Usually in real life, you know, you do something dumb, you get punished, you do something good, you get rewarded. It's pretty easy to figure it out, roughly. In trading, you have a lot of this that you can do something bad, like you can do a bad trade and you can get rewarded.
00:32:37
Speaker
And you can do a good thing and lose money. And this is hard to navigate. It's hard to, you know, evaluate objectively what was right, what was wrong. And if you don't have this intellectual honesty and this need to be rigorous and objective, ah you're going to struggle a lot. You're going to get failed signals and that's going to slip into your how disciplined you are. Like you might think, you know, you may be working hard, but... um
00:33:08
Speaker
um that it's it's It's a hard question to answer for for everybody because there are many variables here from from personal life to this we just talked about to um desperation. like ah This is another thing. like You shouldn't force. Some people feel pressure in the prop.
00:33:26
Speaker
this This is related to the adjustment period we we talked about earlier and this never goes away. And this was also like me somewhat in the first months I remember.
00:33:36
Speaker
um from the you know I'm generally competitive, so from this need to show good results, it was backfiring. And to the point, you know I was almost you know had a conversation with Bitbit that was... you know He didn't say anything like ah in terms of an ultimatum, but I could get from the vibe of the conversation that you know I need to to make something happen here or and there is not infinite time. Yeah.
00:34:02
Speaker
yeah
00:34:05
Speaker
Thankfully, we've come a long way from that. It's been more than three years, so I do not remember much, but it's, um well, how you would deal with any bad trading period, right? You need to sober up, get to the whiteboard. Review everything.
00:34:25
Speaker
ah Be very objective about what went wrong, what went right. Try to do more of the right things. Be very, very, very disciplined on what you click. um And yeah, that that's it. so you you Obviously, you always want to journal a bit and keep track, but sometimes you have to do these deep dives and figure out what's wrong.
00:34:50
Speaker
How much time do you give people when they're like having a period where they're not doing well? Maybe not even just say where they're not where i like having a drawdown, but also where they're just like breaking even and not not really like doing anything.
00:35:03
Speaker
You would have to evaluate this based on the strategy, right? So for example, if someone has a long buy strategy and he correlates with the market and the market is going down only like now for um half a year and they're break even, they're good.
00:35:20
Speaker
They're not even bad, you know, like they're very good. So that's one big variable. Another variable is how much we think of the values we talked about they have.
00:35:32
Speaker
Right? If someone is very disciplined, like I can see it, or he's very curious, always digging to find something new, very professional, very reliable, we're way more inclined to give more time. If someone is hard to work with and on top of that he doesn't make money, well, that's obviously a tighter window.
00:35:53
Speaker
um And contributions is another. Like, you can have a trader that is not, so didn't have the strongest year or even a bad year, right?
00:36:05
Speaker
But he somehow keeps delivering on the research fronts or some other, you know, venture and this one you're happy to keep, right? um So it's this mix of contributions, values outside the P&L, and what the strategy should do based on these conditions.
00:36:29
Speaker
makes a lot of sense actually it sounds very like reasonable and um i think many many people in in crypto and or encrypted crypto twitter are kind of like long bias long long only and only really like make money when the market is going up mean like yeah good good conditions and um It makes a lot of sense that you kind of like I guess if you had someone at the fund and he was just long biased and he would just lose money since the beginning of the year and he wouldn't really like try to find any other way to to make money, and then he would kind of be like, hey, maybe this isn't working out. Yeah, and I tried try to put some effort into finding something else or
00:37:07
Speaker
Yeah, and also depends on the relative performance, right? Like if if you lose way less than the market, like I said, it's really good. But if you make and lose the same and you're basically like us going and opening up a 1x position on BTC, then what's the point, you know, if yeah there's no point? Yeah.
00:37:27
Speaker
So you want to see this over performance, which is versus a benchmark. Like you could lose money and still be outperforming in some sense. And then um this is something you want to.
00:37:39
Speaker
Again, it depends, right? Like ah the kind of fund you are and what kind of exposure you want to have. ah they're Most of the funds I would say in crypto are very like they're most of them are quant shops like quant shops and VCs. Okay, VCs don't really. Yeah, they have liquid books, but you know, they don't really trade most of the time. yeah Quant shops are very rigid about how they hire what they do.
00:38:05
Speaker
Yeah. <unk> I'd say there are not many funds left, if any, like very, very few like us, because it's objectively, I think, very hard to make ah click trading successful.
Odi's Market Perspective and Optimism
00:38:20
Speaker
Do you think like the, there what do you think about the future of like crypto and stuff like that in general? Right now it's obviously like very bleak and there's like fears like in every bear market, quantum fears and is Bitcoin even worth anything? Are altcoins ever going to come come back and stuff like that?
00:38:39
Speaker
It's ah an interesting question because for all these years I've been in crypto, I feel like I've been very skeptic about it. Like ah not only at the lows, but even at the highs, you know, I have a lot of questions. Nothing really made sense. I mean, in hindsight, this is kind of clear in terms of, you know, valuations, tokens, what they do, right?
00:39:00
Speaker
um And I thought, you know, even if we're having a raging raging bull market, like where is this innovation really going? You know, like it's not going anywhere.
00:39:12
Speaker
yeah But surprisingly now, like I found myself changing this attitude even here at the Lowe's. because I see some good potential with like certain initiatives of certain tokens or platforms that ah want to align more value to the tokens. So some things make more sense. Obviously, stablecoin tokenized payments, all this makes more sense.
00:39:38
Speaker
So generally, i would say my view has improved. ah But I also hold this view. I told you earlier earlier that ALT have entered some kind of ah euthanasia cost a roller coaster and they don't have a reason to exist, most of them. I think we're going through a phase of clearing up, which is very, very good to see. um It's unfortunate that some exchanges started listing so many products.
00:40:06
Speaker
ah you know It started from one or two, i want to mention any names, but then pretty much everybody had to copy, right? to miss out on market, sir. And we got into a situation where you have 500 contracts or more ah per exchange. And that objectively is not good for business because if you had 100 assets and 100 billion in bids aggregate, random numbers, obviously, it's much easier to move these assets, right? But if you have to spread the same amount of capital to more assets, it's like simple math that you're going to have a much smaller return and we're trading a market where the average correlation between assets is like 0.96 so you're listing more instruments you're just diluting you're not achieving anything.
00:40:54
Speaker
ah But thankfully, now we see some trends of the listings. I think this should continue. ah Token alignment should also continue. It's a very positive change. um So yeah, I don't have the I have a positive view.
00:41:11
Speaker
um And I think it's a good time to, well, I don't want to give any sort of advice, right? But it's not a terrible spot to have a positive outlook. Let's put it like that, right?
00:41:27
Speaker
I was much more like a few months ago, just seven, eight months ago, where this we had so many dots, for example. This was one of the main red sign. you know it sign It made all the bells ring that you had dots that immediately flopped, basically buying insane amount of tokens, mostly locked tokens.
00:41:54
Speaker
ah Some investors made money by being very early in the funding rounds. It was all like, a a yeah, I don't want to say too many things, but this was the opposite of what's happening now with the cleansing and yeah. making yeah
00:42:11
Speaker
I think that's ah that's a nice ah outlook. It's very difficult sometimes to to stay positive during during bear markets when everything is kind of like not not doing that well, but it's good to have some positive voices too. I think like what you mentioned about um having so many contracts and stuff is like very interesting because um One of the the things that I've seen in Silicon talk about back in the day was that if you buy altcoins, you like kind of kill the the Bitcoin trend because that's like all the money that's going into into an altcoin is like not going into into Bitcoin to make the price go up.
00:42:46
Speaker
And back in the day, at least during 2021, there was like an environment where there was enough liquidity, there was enough like helicopter money, and then people were at home and everything was going around. And there were also a lot less coins, so we could like sustain everything going up at once, pretty much.
00:43:02
Speaker
But nowadays, like this cycle doesn't have that. And then it also didn't didn't have like the fewer number of coins. But as you said, 500 different contracts on all the venues and then meme coins as well. And like everyone can make a coin extremely easily. And we just have like probably a hundred thousands of coins if you count like every every single meme coin or whatever now. So it's like way way more difficult for liquidity to accrue to a couple of things and actually push push like things upward.
00:43:30
Speaker
Exactly. ah we have It's basically what you said. We have less money, less capital, more assets. So it's a lose-lose in terms of how much you can move ah coins up.
00:43:42
Speaker
Mm-hmm.
00:43:44
Speaker
Do your traders um usually trade like majors or like bit Bitcoin or ETH do they also like trade a lot of altcoins or it like dependent on markets market structure?
Trading Strategies and Intuition
00:43:55
Speaker
Yeah, I would say they trade them anything. There is not a certain trend there. Anything that's on the venues we are trading on, they will trade.
00:44:07
Speaker
And are there like more ah low timeframe traders or are there also people that are taking like huge timeframe swings? um i would say here the bias is more towards actually it's um it's again a mix like the directional traders will tend to take shorter trades some hold the day there are some who hold seconds and then on more um delta neutral approaches you will see like longer horizons usually
00:44:38
Speaker
ah I mean, it makes sense if you're entering some kind of a hedged bet, you are not looking to close it in 10 seconds or a few hours, most of the time at least. So you would say like directional betting makes more sense for for the short term in general?
00:44:55
Speaker
I would say that's generally um what makes sense um from from the perspective that if you, let's say, long Bitcoin now, right, and you're looking to hold a year, it's very hard to define what's your edge. You have infinite variables that can impact you. You know you you have all these headlines, you know the war that's happening now. um So what's your ads? It's very hard to isolate it.
00:45:26
Speaker
And yeah, i mean, if you don't really, i don't we we don't have anybody really who trades, like to take a swing, I feel like it's mostly the type of trading, you know, that you're trading with lines, you know, TA, don't really do this.
00:45:42
Speaker
Like I said, we do it on ah on a broad level with the investment strategy, right? You want when you see fraud to divest from the long exposure, but in the sense of an edge that's repeatable. And also if you trade like this, you'll have a small sample.
00:46:00
Speaker
So it's also hard to end up at a prop or a fund. Obviously, there are big big managers who do this kind of thing with the long funds, right? um But yeah, it's not very common on this yeah intersection between retail and big funds.
00:46:21
Speaker
When I think about it, that actually makes a lot of sense because I feel like the when when you know about these legendary fund managers that have like longer term positions or whatever, they also have like a lot more capital and then they also have like like they trade different markets and I guess if if you have like billions of capital, then you're kind of a bit more forced ah to have longer term positions as well because it's just like so much more difficult to like scale in and out of stuff than if you're just trading crypto where it's just like much smaller market and there's like different liquidity constraints and stuff like that.
00:46:55
Speaker
Exactly. Plus, surviv for survivors, it's biased, right? Like if you started, if you were lucky enough to start your fund that's long only, you know, 20, 25K, well, it's not hard to be a prodigy, you know, but if you started at 120, good luck, you know, you've been dealt a very bad hunt and most will fail, underperform, etc.
00:47:18
Speaker
um yeah Do you still trade yourself? Yes, for sure. ah Maybe I'm misrepresented, but still a ah bunch of my work is trading. um ah it's It's not, I wouldn't say it's two jobs because they have like a lot of intersection and overlap, like, you know,
00:47:39
Speaker
um If I'm reviewing research or doing research, I will use it for my trading. So, you know, this is kind of, it's easy to ah tap in and out from the trader and ah the operations role, but definitely i do a lot of trading myself. And I think it's um paramount to do that. Like it's it's very hard, if not impossible or, you know, irrational to lead a trading operation if you don't make money of yourself. Like, yeah. if you don't have this kind of intuition or like, how do you know what's right or what, what, what the direction should be. So I think this is like a, you need to do this.
00:48:20
Speaker
Um, yeah.
00:48:24
Speaker
So you always ah kind of like stay on top of your game and then be a good example for all the other people that you work with. Yes, I generally try to, it's not always possible and the ah the team is very ambitious, but I try to work like more than everybody in that regard to catch up with both sides and yeah give a good ah example.
00:48:47
Speaker
I mean, what's the point of asking people to work hard hard if you're just there, you know, just overseeing in very broad terms like that? That's not very. Yeah. So so what do you do you do when you have like a bad bad time in the market?
00:49:03
Speaker
Yeah, that sacks because you have to, you know, chalk it up and basically ah put on a, ah not a brave face, but I mean, we we try and I think especially in this context, like after many years, that having a bad month, ah having a bad week is very normalized.
00:49:24
Speaker
right and we i don't know if you've heard this kind of quote like good traders are good losers doesn't sound fancy at all but it's very true and uh so it's like there is no there is a lot of stigma for some reason quote unquote stigma right on on twitter about taking losses or not making money in a particular trade or environment you know but If you've worked for many years inside a prop and you've seen, you know, a bunch of traders and you've seen competitors, you've seen everything, you know, that's like totally normal. So it's not the end of the world, but generally, obviously, it it has a it reflects on your mood and you need to just, you know, tell yourself, you know, you trust your system at this point and you just know this is temporary.
00:50:12
Speaker
So you keep going whatever you
Evolving Trading Styles and Advice for Aspiring Traders
00:50:14
Speaker
would do. But, the you know, it's it's like, for example, ah you i would tend to not bug traders who have a bad day to do something.
00:50:25
Speaker
You know, I'll give a little leeway there. Or if someone is having a good day, he's more inclined to work really hard at something, finish it, you know, in one, two days. so it's something to keep in mind. But it's like, ah like I said, normalized. It's not going to impact our operations like deeply.
00:50:42
Speaker
If you can speak about that a little bit, just like in in general terms, maybe how does your own trading look like or how does it look like compared to to what you did when you were still a solo trader or like a couple of years ago? how did it change over time?
00:50:55
Speaker
um i don't think yeah like i don't think i can speak to the first question like to to the first question uh but for the second question uh what's interesting is that um my trading style changed completely like uh when i started i was borderline you know um let's just say extremely sad on trading just Bitcoin and now it's much, much different. I trade a lot of things, different things. I try to follow this advice i told you to always experiment. So that's the the one thing I can say there. But yeah, couldn't go into many specifics about the strategies.
00:51:38
Speaker
But just like maybe like but what what you're also like a shorter time frame trader than I imagine. um No, i I wouldn't say so, except maybe some news and headlines. um Yeah.
00:51:52
Speaker
Yeah. I'm not in that bucket. but What are like some of the the lessons or maybe also the mistakes that you've made like over the years as your role expanded?
00:52:05
Speaker
Good question. I think... I would need to to reflect on that more, right? um Sometimes it must be hard to, like, you know, if trading is very, very busy, it's hard to keep in touch with all your traders to the point they should. yeah So generally, while I try to speak to everybody on a very frequent basis, sometimes it's just not possible. That comes with trying to do both things, I guess.
00:52:37
Speaker
um some other mistakes maybe early uh in the when i took off over like the new role i could have pushed for some things to happen faster maybe but uh you know it was like trying to figure out the balance and uh
00:53:00
Speaker
yeah I mean, when you're coming into a new place or a new role, it's always kind of like, yes i would not how would that easy to just like take responsibility from the start. Yes, but you know the gi off yeah the difference here though is that I had, like I worked there as as a trader for two years. So I was very familiar with the environment and the individuals. I obviously made a lot of mistakes, right? I'm not trying to sound like I made no mistakes, but It was more of a day-to-day, kept reviewing. i mean, you learn as you go. It's it's also not like a role you can have a ton of experience in.
00:53:39
Speaker
um but yeah
00:53:44
Speaker
I know you said earlier you don't really like ah when they want to give people advice or whatever, but what what would you say to someone if they're like interested in in working at ah at a prop firm or if they're like interested in working at your you're firm?
00:53:57
Speaker
like What what's what's sort of would you tell them don't trade at all, don't even try or like No, i wouldn't better conditions I wouldn't say that. Yeah, that would apply to to most people, right? I think objectively trading is very hard for a long period of time and regime like a market environment plays a very big role, especially to crypto.
00:54:21
Speaker
But what I would say to people who are looking to work for a fund like us is that generally, unless you you know we are talking about top five names, that your track record can you can get you further than you think.
00:54:36
Speaker
um like um there is this notion you know that um i guess propagated by certain names and very big players that it's extremely complex what's happening inside the fund and you can never get in if you're not from an ivy league but that's like the quant swap the top 20 names quant shop pipeline right like In general terms, for mid-sized firms, small-sized firms, very strong or a strong track record can get you very far, especially if you get lucky with with the timing. Like I said before, you knock on 30 doors and you might just get lucky in the sense that a particular desk at that time is looking to hire juniors.
00:55:25
Speaker
So like you said, you can have one year of track record and you fall, you know and you you get lucky and you get in So ah from what I've seen, people don't tend to do that. Like they're very, I don't know, ah not exactly not proud of the results, but they are not very confident. Right. And this is maybe another big thing that we didn't touch at all about, you know, trading qualities and predictors of success. But confidence is. yeah huge thing. um
00:55:57
Speaker
If you don't have confidence, especially in click trading, you you won't get far um because a big component is knowing when to stick to your like when to stick to your positions. Usually, you will if you don't have confidence, you will make mistakes under pressure, which are usually the most critical spots.
00:56:17
Speaker
Same kind of goes for, you know, more generic and from from a more generic life perspective approach to applying, to having the confidence to knock on doors.
00:56:28
Speaker
um Yeah. And I've i've seen, you know, some people can get very far just from this and some others can stay behind because they just like to stay sheltered or yeah.
00:56:39
Speaker
Obviously you need a good track record. So, but yeah. Like I'm not sure sometimes what's missing more are people not so confident or are just a ton of people LARPing and there are no good track records, you know, probably a mix of both, but yeah.
00:56:58
Speaker
I mean, I think especially in crypto, you probably that never run out of a supply of people LARPing. Yeah. It's like very, very common here, but I guess... ah but yeah it's not yeah and But these people won't apply to you. like They won't reach out because they do something else.
00:57:18
Speaker
Trading is not a core business. Yeah. Sorry, go on. I guess you could you could say it like that. Yeah, but like ah the confidence thing is very interesting that that you're saying that like people don't have enough confidence to really like apply themselves. or I think it's good also that you said that you need to understand that what you're doing is kind of like very different from a quant shop, I guess, where it's kind of...
00:57:41
Speaker
I mean, I guess it's possible if you're like a retail person to just like teach all of that to yourself and like eventually you get into it in like a very... Yeah. likelihood But like, I mean, if you're not a... ah Like, it's not, I've talked about this often on the on the podcast here before, because like there's always coming, this debate coming up of like quantitative traders versus directional traders and quantitative traders are like, hey, directional people just shouldn't trade at all. It doesn't make sense. And then there's counter examples and stuff like that. But yeah.
00:58:14
Speaker
Just because you you can be like very smart and look at the market from like a very smart perspective and like have all these math equations and have a PhD in physics or whatever and then you work at a quant shop doesn't mean that you also can't just like mike make money with like a lot simpler stuff, I guess.
00:58:31
Speaker
Yeah. um but Both things are true in the sense that the proliferation of QuantSoaps is based on this idea that it eliminates the human factor, right? And generally it's hard to make ah ah click trading work at scale, you know, because also the scale the the stakes change when more money comes in, there is more pressure.
00:58:52
Speaker
um it's It's objectively hard to navigate behaviorally like we said before. But um when you do something for a long time and you see it working over and over again, eventually you build this confidence and it just has a very high impact. Also, let's say for myself, even outside the prop context, if I wasn't, I think, honestly, if I wasn't very lucky in 2021 winning this competition, i I would have way less confidence and perhaps this would have impacted my trading, my decisions.
00:59:25
Speaker
um it's you know luck is a big factor too many people don't like to admit this because they want to you know generally i think most people are not very comfortable with the idea of not having full control over their outcomes but for sure it's a big factor um in trading and in and in life in the sense of you know this career's prospects we've been talking about um But yeah, um I guess ah to make it more practical, um one thing that can give you confidence is also your system. Like I remember one of the most um dumbing questions our head of trading had made when I first joined. It was like, okay, write me two, three paragraphs. What is your edge?
01:00:16
Speaker
And this question alone, it's not, um I mean, you have some things, but when you, but many people and or junior traders and retail traders, it's very instinctive and intuition based and it changes a lot. It's not, I'm not talking about going fully systematic, but if you don't have like a theory as to what why this works and like it's not directly linked if it's the if it's a correlation type of and it's not causal like you're you're not gonna objectively have confidence in this system you yeah
01:00:58
Speaker
So working on your edge. What would say edge means like in in that sense, if you can like explain that a little bit. Like what what is the difference between having edge and just being like lucky, I guess.
01:01:12
Speaker
I would say that you would need to define who is your counterparty and why they're losing. Like when you're taking a trade, who is on the other side and why do you think um you're taking value from them and they're not taking from you.
01:01:30
Speaker
Like quant shops can do this very well because they rely on models, like latency. mean, a lot of quant shops are just about latency, right? um But yeah, if you can't really define, like that's how you spot a good trade as well. Like you're entering the trade and you know the other side is just misinformed. A very simple example of this is in news trading, right?
01:01:56
Speaker
You click on a headline considering you're early enough, right? that The people who sit on the book just didn't see the news fast enough. So you're that's the value you're extracting. That's how your counterparty is wrong.
01:02:10
Speaker
So i would say this is the central question. There are more, but yeah this answer is like 90% probably.
01:02:19
Speaker
I think that's a good answer. Yeah, that makes sense. Is there anything else that you you would like to touch on or anything else? Maybe some some wisdom that you would like to give people? I think you already give did give some good wisdom, but Anything else you want to No, I think we covered a lot, right? um I think if anything else, well, now we're working a bit more on our um public side. You know, we, i don't know if you saw, we're trying to get a bit into the news, break some headlines. We had some progress there. We also try to share some of our research work that's not super sensitive or, ah you know, proprietary.
01:03:01
Speaker
um We are exploring some other options regarding hiring funding, but like i I would say like, can't say something meaningful here. If just follow the page, you will get any update on that note if you're interested. Yeah.
01:03:17
Speaker
So people should like, ah just follow your your Twitter page or if they want Not mine, but yeah, Credos. That's where if any material update will come through, not my page. Yeah.
01:03:29
Speaker
Good. We'll link that below. and I guess ah this is a good good point then to wrap it up. We touched a lot of stuff. Thank you very much for for coming on. This has been interesting. and but Thank you. Thank you for having me, man. Yeah, it's been a pleasure. Of course.
01:03:43
Speaker
And goodbye, everyone.