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Market Maker's Quantum Leap

Traders Magazine, October 2004

Nina Mehta

Meet a former market maker. He's David Wehrle, a veteran of the third market who switched to the buyside. He's director of trading and operations at Archetype Risk Advisors Inc. (ARA). ARA, a quantitative money manager, wanted a trader with traditional sellside tape-reading skills, so it hired Wehrle in March. Wehrle spent about 15 years as a market maker in listed stocks. He started with Trimark Securities, which later became part of Knight Capital Markets. He traded 15 large-cap listed stocks, including Hewlett-Packard, Compaq and Tyco. ARA, which has $75 million under management, was recently reorganized. The New Haven, Conn.-based firm has two managed futures funds and a fledgling quantitative equities fund that was launched in August with $11 million in seed capital. A former equities fund, which had $650 million under management, was closed in 2003. Wehrle oversees trading for all the funds. Many traditional OTC and listed market makers have complained about decimalization. It compressed spreads and took the wind out of many a P&L. Wehrle finds it ironic that decimalization contributed to the quantitative equities strategy he's now executing.

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