Morning Coffee: Citadel Securities' enthusiasm for hiring teenagers on $200k is unabated. A hedge fund gets heavy with its quants

Things go in cycles. Not so long ago, people were bemoaning that the smartest young graduates were all going into finance rather than creating the technology of the future.  A bit later, top talent started to prefer Big Tech, and the same people were bemoaning that the geniuses were all spending their time trying to target social media ads rather than creating the technology of the future.  And now it appears that finance has got the juice back; after a short period of time creating the future at SpaceX, 16-year-old prodigy Kairan Quazi has taken a job at Citadel Securities, where he will be a developer using his talents to helping to match securities buyers to securities sellers.

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Kairan is the real deal in terms of youth and intellectual prowess – described as “profoundly gifted”, he started an undergraduate degree in California at the age of 9, before interning at Intel Labs and an AI firm. Aged 14, he was already in charge of production-critical software projects for Starlink communications satellites. 

Kairan came from a financial family – his mother was an M&A advisory banker, which is not a job particularly adjacent to quant trading, but might mean he grew up with a more positive image of the markets than other 2010s kids.  He also appears to understand that the big benefit of working in quant development, compared to rocket science, is that you get immediate and direct feedback about whether your ideas have actually worked.

And now he’s going to be a quant developer, working for Peng Zhao. Kairan will probably be the youngest quant in the building, although not necessarily by as many years as you might have guessed.  Zhao seems to have a habit of recruiting very young people – last year it was Michael Khaykin, a robotics enthusiast who had just graduated at the age of 19.  And the Citadel organisation in general doesn’t seem to mind paying extraordinary amounts of money to people who aren’t old enough to drink in bars – the sister hedge fund was paying more than $5k a week to its 2025 internship class. 

Peng Zhao was a child prodigy himself – like Kairan Quazi, he went to university as a 14-year-old, after having had to dig through a garbage heap in order to find his ticket to the mathematics Olympiad which won him entry to a top college. So he might be predisposed to believe that if you’re good enough, you’re old enough. 

Elsewhere, it seems that the hedge fund Man Group is the latest employer to start trying to change employment contracts to make it more difficult for staff to leave. And the staff don’t like it – according to one insider speaking off the record, several of them responded by immediately seeking other offers while they were still subject to the shorter notice period.

It’s a trend we’ve also seen in hot areas of the investment banking market, like private equity secondaries.  It’s likely to reflect the current state of the labour market, in which “natural attrition” rates have fallen to historically low levels. This has two consequences.

First, it’s a symptom of a market in which it’s difficult to persuade anyone to move.  When recruiting good people is difficult, holding on to the ones you have becomes more important.  And second, there are two types of “attrition” – employees that you’re happy to lose, and ones that you wanted to retain.  In uncertain conditions, mediocre people are much more likely to stay put and try to avoid being noticed than stars.  That means that nearly all the remaining churn in the market is likely to be seen as “bad attrition” by the employers.

Meanwhile …

He’s back with a SPAC! Chamath Palihapitiya is launching the “American Exceptionalism Acquisition Corp”, and there is to be none of the kind of negativity that accompanied some of his previous gifts to the investing public.  The accompanying letter warns investors that “if they do lose their entire capital”, they ought to “embody the adage from President Trump that there can be “no crying in the casino.”” (FT)

Not quite everyone in New York financial circles is scared of Zohran Mamdani.  Elizabeth Simons, daughter of the founder of Renaissance Technologies, has donated $250,000 to his campaign PAC. (Bloomberg)

If Kairan Quazi had been born a girl, he might have taken a different career path.  Female graduates in maths and physics are more likely to go into teaching than finance or tech, accounting for a large gender gap arising quickly after leaving university. (FT)

John Toomey of HarbourVest defends the secondaries industry as a useful partner for private equity and says he doesn’t expect the continued flood of money to reduce returns in private markets.  He also thinks that AI will “place a premium on softer skills than maybe there had been”, and that the lines on CVs that catch his eye these days are those which demonstrate leadership. (Semafor)

Goldman Sachs’ new Mumbai office is 50% larger than the previous one, and has height-adjustable desks. It’s also growing its back- and mid-office centres in India. (Bloomberg)

Rocco Milia was about to start an investment banking job in September, but a last minute phone call has sent him back to college, as he’s been given a dream offer to play linebacker for the Michigan Wolverines.  Luckily for him, his boss is also a former college football player and has allowed him to defer for a year. (Detroit News)

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