27 year-old hedge fund manager: I live a pretty standard life
The last time we spoke to Nikita Fadeev, he seemed a potential poster boy for premature burnout. Aged only 26, Fadeev was running Fasanara Digital, a quant crypto hedge fund with 13 employees and $150m of crypto assets under management and in doing so he was working all day and all night. One year later, the assets under management and employee numbers have shrunk (they’re down to $80m and 12 respectively) and so has Fadeev’s risk of burning out.
“Though most of my waking hours are devoted to my work, my definition of 'work' has evolved,” says Fadeev of his maturation. “I read a lot of books and watch documentaries, which some people might say is leisure, but I find invaluable analogies there about how teams go through challenging seasons and come back stronger. I’m looking at a lot of things like psychology and sport that might not seem related to trading, but they significantly inform my perspectives on efficiency, innovative decision-making and incremental improvement.”
The parallel between a challenging seasons in sport and running a crypto hedge fund in 2022-23 doesn’t need much elaboration. “Last year has been very difficult for the space,” admits Fadeev. “There were challenges from all directions, and a lot of firms were knocked out and wound down to zero.”
Despite being battered by the storm Fasanara Digital survived and just won best overall digital asset manager in Hedgeweek’s European Digital Assets Awards. “Despite the turbulences, we outperformed the market and the majority of our competitors both in absolute and relative terms,” says Fadeev. “We did pretty well.”
How does a 27 year-old come to run his own $80m hedge fund? The answer is that Fasanara Digital isn’t Fadeev’s own fund but a platform within Fasanara Capital, a $4bn hedge fund founded by former Merrill Lynch banker Francesco Filia. Fadeev, who studied mathematics at St. Andrews University, founded Fasanara Digital in 2018; the parent company offers support.
Despite his youth, Fadeev pushes back on the notion that there are similarities between him and the wild children of the crypto industry. Unlike some of the more notorious young people in crypto, Fadeev says he lives a moderate life and that his existence is pretty standard by British terms. “Over the past few years my life hasn’t changed much,” he says. “Perhaps the only noticeable shift is that I spend more time creating an environment to be in the zone and maximise performance.”
Crypto markets still trade 24/7 though, and there are still times when Fadeev’s existence can be consumed by markets. “Circle, company behind the stablecoin USDC, held a lot of money with Silicon Valley bank and so the weekend it went under there were a lot of opportunities in the market,” he says “I was trading through to 5am, slept for a few hours and then came back on again. In two or three days, I reckon I barely took a break for a total of 10 hours. It was a period of time when the price for ones’ attention was really, really high.”
That’s not the norm. Fasanara Digital places 10s of thousands of trades each day and most of its trading is entirely automated. “Our systems are automated, alleviating the need for a constant oversight, however we tweak parameters, exposures, and the overall risk-allocation quite often” says Fadeev.
If something happens though, Fadeev is there. He likens his role to the teams who change the tires in F1 races: sometimes fine tuning is necessary. For this reason, he never fully switches off. Fadeev still aims to be no more than 90 seconds away from being able to intervene in the system during his waking hours. At night, he aims to be no more than five minutes away: “If something big is happening overnight, I’ll be woken up. That used to happen quite often, but it’s quite infrequent now.”
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