Beating the Odds – Susquehanna International – Jeff Yass
A few years ago, a young Susquehanna trader named Alex Mendoza bet around $500, he says — a hundred with one guy, $50 with another, a lot of side bets, just like the trading floor itself — that he could do 300 push-ups in 45 minutes. He didn’t make it. He paid off his bets, and then was quietly told by management not to make that sort of wager again.
Not because of the amount — $500 is lunch money to a trader. Mendoza was reprimanded because he’d gotten ahead of himself. He had made a dumb bet, because he really didn’t know if he could do 300 push-ups in 45 minutes. If you don’t know the answer, betting is a gamble, utterly antithetical to the Yass method.
“Every mistake, every loss, becomes a teaching moment,” Mendoza says. He means both in trades and in how traders think. “When you’re constantly reminded of how the world works and how it doesn’t deviate, you start to think that way.”
How many doughnuts can you eat in 20 minutes? Research! A trader in the New York office surreptitiously went to Dunkin’ Donuts, took the doughnut maker aside, learned which ones are the lightest, have the least filling and sugar and calories, etc. Pocketing a few hundred bucks after winning his bet, he sat back at his desk munching the richest, most sugary doughnut. Just to rub it in.
If you open your mouth, back it up. How many people will know what year — within 20 years, within 10 years, five — Abraham Lincoln was shot? Is Alabama bigger than Wisconsin? One year, traders in the Chicago office bet on snow futures, a made-up security, wagering against (or for) a harsh winter.
This is the place you want to work. You’ll get rich and have a sporting time. Always seeking edge. A couple of giggling traders from the New York office once made a bet on something they figured Yass couldn’t possibly know, and gave a quick call to the Bala office:
“Jeff, who was the last king in the Plantagenet dynasty?”
“Richard the Third!” Yass growled, slamming the phone down. Very well-read guy, that Yass. Dumb to bet against him.
For a long time, Yass didn’t lose the betting bug. A trader named Francis Wisniewski says he kept getting kicked off his computer in the Bala office back in the ’90s so Yass and Dantchik and Greenberg could check the odds, place Pick 6 bets. (The company denies this.) The firm also hosts poker tournaments — Jeff Yass deals — with cash prizes. It’s a way of attracting top-drawer recruits (employees don’t risk their own money) and of vetting them as decision-makers: reckless poker player equals reckless trader. Susquehanna has become renowned in the trading world for its three-month tutorials of new hires, where in-house games of poker are front and center as a teaching tool. After-hours games in the offices — that’s just for sport.