Point72 CEO Steve Cohen: It's better to look stupid than be mediocre

Point72's founder and CEO Steve Cohen may have stepped back from investing this year, but he's not stepped back from podcasting. In a YouTube video released by the hedge fund yesterday, Cohen dispensed wisdom on how to succeed as a hedge fund portfolio manager, and what it takes to succeed specifically at Point72.

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Cohen says cultures at hedge funds are, largely, a reflection of their founder. Cohen said you need to be in a "constant state of improvement" and to love the job; he hated his weekends as a trader, loved his Mondays, and "do[esn't] like being mediocre." Cohen took this to extreme lengths in the past, and missed the birth of his youngest child because he was trading, but these days he's apparently more chilled.

To improve, Cohen says you need to learn from other people, despite the risk of looking foolish. He said he's "not afraid to look stupid" if he doesn't know something. "Maybe I don't, that's the fun part." At hedge funds especially, where the talent is "exceptional," Cohen says you should be "soaking it all up" from other employees with fresh perspectives. Point72's now-sole CIO Harry Schwefel said, "in any given room, [Cohen is] the one asking the most questions."

Point72 has been expanding its entry-level opportunities in recent years; this year's internship class was its biggest ever and had a 0.18% acceptance rate, while its KEPL algorithmic trading team has been hiring interns on $25k per month salaries. Cohen says the fund's appreciation for young talent stems from the fact that "they’re open to new ideas and up on new techniques and technologies." 

You can't only focus on shiny new things, however. In one of many sports-based analogies typical of a baseball team owner, Cohen says that if you've got a great fastball, okay curveball and a bad splitter, you ought to "throw your best pitch," regardless of what everyone else is doing. By this, he means you should have a "foundation" in the way you trade that you are passionate about; you should be "constantly refining who you are," but that foundation shouldn't change.

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