Wall Street’s heavy hitters have a secret: the performance coach.
While still rare, money mentors are slowly becoming a trend in the world of finance. They teach traders to remain calm, not panic and be confident. Much of their work has been confidential, until now.
Billions, the new high-stakes finance drama that debuted on Showtime last Sunday, has shone a new light on their secret world.
The fictional performance coach at Billions’ Axe Capital is played by Maggie Siffs. Her character, Wendy Rhoades, is part HR, part therapist as well as the wife of district attorney Chuck Rhoades (Paul Giamatti). If you are a trader at Axe Capital, one session with Wendy Rhoades can turn your luck around. They call her Dr Mojo.
For Wendy Rhoades, helping anxious traders find their alpha and providing support to female traders in the mostly male profession is just a part of a typical day. The hedge fund, where she works, was founded by Bobby “Axe” Axelrod, who also occasionally needs a Mojo makeover.
“Your value to this firm is absolute,” he tells her.
‘Go back to your Bloomberg and cut bait on your losers’
One of Axe’s underlings, Mick Danzig, is played by Nathan Darrow. Darrow’s favorite scene is when Siff’s character tells him: “Go back to your Bloomberg and cut bait on your losers.” In the scene, Darrow’s character – sporting the typical Wall Street uniform of a fleece vest – tells Rhoades that his performance has been slipping. “You don’t need meds. You are just listening to the wrong voice,” Rhoades tells him.
You are tuned in to the one yelling at you over the loudspeaker that you are fucking stupid and your performance blows and you are ignoring the quiet one, inside, telling you where the alpha is. Now, that’s the voice that got you here and it’s still there if you are willing to listen. What’s that voice telling you?
“Stand up,” she orders him, shortly before making him beat his chest while repeating out loud a figure that he brought in last year: $7.2m.
In real life, there is less chest pounding and more reassuring. Many traders question whether they belong, whether they are smart enough or good enough, Shull says.
“Everyone thinks that these guys are super confident and have no self-doubt, but that’s not true. You are always as good as your next trade. There is always an element of continuously wanting to improve themselves.”
Without the need to improve, they and their firms might not make it, she said.
“As the competition is increasing in the industry, to be on top of your game, you need to be serious and to be serious about what you do,” says Boris Pilichowski, consultant and trading coach who runs London-based coaching firm Axis Minds. To him, “being serious” includes spending time evaluating one’s performance and trying to determine how to improve. “If you are not looking at your practice and you are not in the mindset of continuous improvement, you aren’t going to make it.”
Coaching is still rare on Wall Street
Coaching, especially at hedge funds and other financial firms, is still not common. It is, however, a market that’s developing fast, says Pilichowski. Shull estimates that about one in five firms has worked with a performance coach.
“A lot of firms don’t get that there is a psychology to trading and working with it and using it as strategy can be a real benefit,” explains Shull, who gets hired by individuals as well as firms. “Just as often I get individuals at firms who say they want to work with a psychology coach but they are afraid to bring it to the firm or their [chief investment officer].”
Probably the most well known example of a performance coach working with a hedge fund is Ari Kiev, a psychiatrist who spent more than a decade working with traders at SAC Capital Advisors. A couple of years after Kiev’s death, Shull interviewed with SAC to replace him as the executive coach but did not get the job.
Many have speculated that Giamatti’s character on Billions is modeled after US attorney Preet Bharara, and chief Axe man Bobby Axelrod (Damina Lewis) is the fiction version of Steve Cohen, founder of SAC. Andrew Ross Sorkin, the New York Times reporter and co-creator and co-producer of the show, denies that the characters have been modeled after Bharara and Cohen. But the Kiev-angle is only likely to increase speculation.
Cohen hired Kiev in 1992. Just months before he died, in January 2009, Kiev announced that he was going to launch a consulting practice. “This consulting practice effectively allows me to broaden my reach and offer customized services to an increasing number of fund managers who are recognizing the importance of a psychological perspective in managing investments,” he said at the time.
Pilichowsky, a former trader, says he works with a small team of hand-selected coaches. Their jobs is not to judge their clients, but rather to work with them and help them improve. Often time this means working with clients on handling stress and raising awareness of how they behave in certain situations.
“It’s psychological, but I don’t put people on the sofa,” says Pilichowski.
“When you come to a competitive market, it’s all about the emotions because there is nothing that the other guy doesn’t have. If everyone has the same information, everyone has the same power of calculation, everyone has the same spreadsheet, the difference between me and that guy is going to be about the way we manage it emotionally. Don’t panic. Don’t go too fast. Don’t be jealous.”
The most common emotion experienced by traders is the fear of missing out, says Shull.
“People are afraid to just cut their losses because they are afraid the trade will come back. It’s usually not even about the money. It’s about: ‘If I get out now and the trade comes back, I will look like an idiot’.”
As a former trader, Shull says she knows how it feels when traders are “afraid to get out of the loser”. It’s the same problem that Mick Danzig, Nathan Darrow’s character on Billions, struggled with.
Shull, who had seen the pilot at the time of the interview, said that she looks forward to watching the first season of the show.
“I like Damian Lewis. Obviously, I like the fact that they’ve got a coach on the show. The dominatrix piece of that coach is, you know, kind of interesting,” Shull laughs, referring to Wendy Rhoades’ evening hobby.
“I think it will be entertaining.”
This article was written by Jana Kasperkevic, for theguardian.com on Sunday 24th January 2016 12.30 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010