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Ben Wright

@ben.variance

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@variance.tech & @cfcycletrading – CEO & Co-Founder
Building institutional-grade trading infrastructure for serious traders and asset managers

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Most strategies fail because they’ve never been properly tested. Most systems fail because they were never properly built.
We work with traders, funds, and developers at every stage, from validating an idea to building the infrastructure around it.
Backtesting. Strategy review. System builds. Product development.
If you’re serious about what you’re building: link in bio. taken in Leeds, England, UK by @ben.variance

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7 months ago

A strategy designed to make Britain’s pensions safer nearly helped break the bond market.

In September 2022, gilt yields surged and pension schemes using liability-driven investment strategies suddenly faced huge collateral calls.

They needed cash quickly, so they sold gilts.

That pushed gilt prices lower and yields higher, triggering more collateral calls and even more selling.

The result was a vicious cycle. Everyone was trying to protect themselves in the same way, at the same time.

The Bank of England eventually stepped in with temporary bond purchases to stop the fire sale and give pension funds time to raise cash.

The real danger wasn’t one reckless bet.

It was a crowded strategy where everyone needed the same exit at once. by @ben.variance

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a day ago

$7 trillion.

That’s how much was traded in the foreign exchange market every day in April 2022.

To put that into perspective, FX isn’t mainly people exchanging money before a holiday.

It’s banks, funds, businesses and governments constantly moving capital, funding transactions and managing currency risk.

And sitting at the centre of it all is the US dollar.

It appeared on one side of 88% of all FX trades.

Most people never see the machinery behind the global financial system. But every international payment, currency hedge and cross-border investment depends on it.

It’s the plumbing that keeps global money moving. by @ben.variance

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3 days ago

One of the biggest stock positions on Wall Street was hiding in plain sight.

Bill Hwang’s family office, Archegos, used swaps to build huge exposure across several banks.

The problem was that each bank could only see its own piece of the risk.

When the underlying stocks began to fall, Archegos couldn’t meet its margin calls. Every lender suddenly wanted out before the others.

Credit Suisse was too slow. The result was a loss of around $5.5 billion. by @ben.variance

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5 days ago

Dublin ✅ First time in Ireland, won’t be the last. Solid dinner with some killers thanks to @andrew.brennansmyth no better reason to show up. taken in Dublin, Ireland by @ben.variance

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7 days ago

Peter Lynch became one of the most successful investors of his generation by paying attention to what was happening in everyday life.

A busy shop, a product everyone suddenly wanted or a company quietly gaining loyal customers could all provide an early clue. But Lynch never treated observation as a replacement for research. The idea still had to survive the numbers. by @ben.variance

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10 days ago

The 2010 Flash Crash is a reminder that markets can move from orderly to disorderly in minutes.

In 2015, the U.S. Commodity Futures Trading Commission charged Navinder Singh Sarao, alleging “spoofing” in E‑mini S&P 500 futures and stating that the alleged conduct contributed to the market conditions that led to May 6, 2010.

Whatever your view on causality, the structural lesson is clear: interconnected, automated markets can amplify stress when liquidity pulls back. by @ben.variance

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10 days ago

In 2016 the BOJ pushed rates below zero, bought massive amounts of bonds and pledged to keep the 10‑year yield around zero. That promise anchored borrowing costs for banks, pension funds and the government, but it also forced the BOJ to stand ready to buy any bonds needed to hold the line.

When markets tried to push yields higher, the BOJ had to intervene, risking huge balance‑sheet exposure. If it stepped back, confidence could crumble, sending shockwaves through portfolios that had come to trust the cap.

For traders, this created a new layer of policy risk, the possibility that a central bank might abandon a promise or be forced to act at unfavourable prices. by @ben.variance

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13 days ago

Great day at Foxhills in Surrey with Softwire connecting with people across financial services, even if my golf game had other plans. by @ben.variance

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15 days ago

Warren Buffett’s biggest edge wasn’t picking stocks.

It was building a structure that could keep compounding.

Berkshire Hathaway began as a struggling textile company. Buffett initially bought shares because they looked cheap. But after taking control, he turned the business into something far more valuable: a permanent home for capital.

Profits could be reinvested instead of paid out. Insurance businesses added float, giving Berkshire more money to invest for longer.

That combination helped turn a failing textile mill into one of the world’s most valuable companies. by @ben.variance

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16 days ago

Cathie Wood is not a case study in conviction to copy blindly.

She is a warning about what happens when a compelling story becomes more important than price, risk and changing evidence.

ARK built its identity around disruptive innovation. That made the strategy easy to understand and easy to market. It also encouraged concentrated exposure to companies whose valuations depended heavily on growth arriving years into the future.

When conditions changed, conviction did not protect investors from volatility.

A bold thesis is not enough. You still need valuation discipline, position sizing and a clear point at which you admit the original idea may be wrong.

Otherwise, “long-term thinking” can become a convenient excuse for ignoring short-term evidence.

Cathie Wood did not prove that conviction always wins.

She showed how expensive conviction can become when it turns into dogma. by @ben.variance

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a month ago

The Godfather of Quant: Jim Simons by @ben.variance

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2 months ago