Pine River's Rapid Current: CTO David Kelly

“Our developers in the US finish up a change, complete integration testing, package a new release, sling it to Beijing for a litany of tests, and by morning know what the risks are, whether to remediate them, or push on toward a final release plan. It helps, leaving the office with 80 things to do, and have 68 of them addressed overnight. Following the sun through Beijing is a tremendous advantage and when I arrived last year, all of that was already standing up. In the past, it’s something I’ve had to build,” Makhija says.

Half a Step
It comes back to foresight. Larger organizations can swallow up wasted IT energy. As a hedge fund technologist, Kelly’s objective is to remain precisely “a half step” ahead of where Pine River is going—no less, no more. A trio of benefits emerges from a measured, meticulous approach.

First, he anticipates that more TBAs (to-be-announced) and agency mortgage bonds—the bread-and-butter of Pine River’s mortgage-backed security (MBS) investments—will see increased automation via execution venues like Tradeweb. Much like its collaboration around swaps, robust technological capacity will help the firm take faster advantage of the scaling opportunities those advancements present, he says.

Blurton points out the second advantage—that, in addition to Kelly, several members of his original BarCap cohort have gone on to major buy-side CTO roles, giving them serious credibility to engage with the sell side, both at a broad level and in the weeds. “In my travels going back to Barclays, Pine River and similar buy-side firms can greatly determine what prime brokerage offerings look like, on the condition that the technology requirements and proposition are articulated clearly,” Kelly says. “Being cost- and optimization-conscious, we have a huge vote.”

Finally, in an ultra-competitive environment, technology becomes the differentiator on two matters that, for an asset manager, count most. “Increasingly, hedge funds are keen on having superior technology to their peers, to the point where the strength of platforms should attract investors on their own,” the CTO says. “What we’re seeing now is that technology is absolutely a factor in portfolio manager recruitment, too, and will become only more important over time.”

Those would seem lofty expectations, but they’re standard where Kelly’s come from, and in Pine River, he’s landed—one more time—right where he belongs. Taylor counts on it. “David simply won’t be pigeon-holed, and that is why we brought him on,” Taylor says. “His is a rare blend.”