A friend from Chilliwack sent an intriguing clipping from The Province, a Vancouver-based newspaper. The February 21 headline in the newspaper was, Bankers Learn to Hurry Hard, while the sub-head was, Wall Street: Competitive Curling Seen as Great Teaching Tool for Junior Staffers.
Huh? Curling? The Roarin’ Game? Tied to the world of big-time Wall Street finance?
Strange as it may sound that seems to be the case.
Apparently, the original story, entitled, What Bankers and Olympic Curlers Have in Common, was shown on New York-based CNBC and written by Ted Kemp, who, among others, interviewed Nigel Lucas, a New York-based portfolio trader for brokerage and investment group CLSA. Outside of Wall Street, Lucas is also the treasurer of the Nutmeg Curling Club in nearby Bridgeport, Connecticut.
“Curling is fiercely competitive,” said Lucas. “It looks slow, but it’s not. You’re not just thinking what are you going to do, but what is the other guy going to do.”
Yes, curling is a cerebral game. A skip anticipates what the opposition will do if a rock is thrown by his or her team in a particular position on the ice. That’s the charm of curling to Wall Street brokers — the game teaches investors to think about the consequences of buying a particular stock.
Paul Baard, an organizational sports psychologist at Fordham University, told Kemp that curling is similar to Wall Street because of its emphasis on strategic thinking and the ability to make quick adjustments to a changing situation.
With such an analogy, it’s no wonder that the two gold-medal curling teams at the recent Sochi Winter Olympics are headed by skips involved in the world of finance. Winnipeg’s Jennifer Jones, the winning women’s competition skip at Sochi, is a lawyer for World Financial Group, while Brad Jacobs, the men’s gold-medal winner, is a Royal Bank account manager.
“Traders work in small teams, and to close a deal, you work in a small team,” said Baard, when comparing curling to the trading on Wall Street “And there’s major pressure. You either win that game, or you lose it.”
Sanjay Nath, the director of the Institute for Graduate Clinical Psychology at Widener University, as have many before him, compared curling to chess. He told Kemp that Wall Streeters “want to watch the market and anticipate what’s going to happen, and they want to do that before their peers do. You get the same thing in curling.”
As in chess, the initiative can change when one team makes a major error.
Essential, what you get in curling with its four-person rinks is an attack followed by a counterattack. A prerequisite is the ability to manage the resources of the team to the ebb and flow of a game. The focus is on organizing a particular curlers’ talent for the benefit of the team — in-turn or out-turn, hitting or drawing, or a combination of the two — so that it leads to success on the ice. On Wall Street, managing abilities also leads to success on the trading floor.
As in curling, chess players have the ability to determine possibilities, added Nath. Curlers try to close with as many points as possible when they deliver the “hammer,” or the final stone that marks the actual physical execution of the strategy the team has been building toward, wrote Kemp.
“It’s about abstract reasoning — can you think on your feet and get to the next step? said Nath. “But you’re also wanting to see the chances of whether they’ll technically be able to do it or not.”
Raj Mahal, a former trader with the Bank of America, told Kemp that he had junior traders handicap curling teams during the previous Winter Olympics in 2010 in Vancouver.
“I would take five or six junior traders and say, ‘Ok, you have three minutes. Come up with a betting line,” said Mahal. “It was an exercise to see how their minds worked and how they handicapped when they didn’t know anything at first about how the game worked.
“After the third or fourth time, the splits were coming in pretty similar. So I could see that they were getting better at it.”
The goal for the traders was to examine how teams performed in previous match-ups and then use that data to set odds on future outcomes.
“Honestly,” he told Kemp, “I had no idea what the odds really were. Then surprisingly, when I back-tested the traders, they were pretty close.”
Jones, with Kaitlyn Lawes at third, Jill Officer playing second, lead Dawn McEwen and alternative Kirsten Wall, closed the deal at Sochi, clinching the gold medal by defeating Sweden.
Curling has become such an attraction to Wall Street because it has gained in popularity on U.S. television, especially during the Olympics. CNBC, the business-oriented arm of NBC News (officially the Consumer News and Business Channel) carried Olympic curling in its 5 p.m. time slot, when the trading day closes. The games proved to be one of CNBC’s highest-rated shows in that time slot.
Canadians may know that curling is suited to television because a game played on a single sheet of ice is compact and camera friendly with the ability to pan in for close-ups of players and the position of rocks in the house, as well as to quickly zoom out to cover the path of a stone down the ice surface. This makes it relatively easy for a viewer to follow the game, and with the addition of knowledgeable commentators, the strategy behind the game becomes readily apparent to even beginning followers of the game. The strategy of the game is so alluring, as is the skill of the throwers, that it’s little wonder that curling has gained in popularity in the U.S. among television audiences.
Traders switched from barking out sell and buy orders on the stock market floor to watching skips on their television sets bark out sweeping orders on the ice at Sochi.
Indeed, “Hurry hard!” has become the phrase of choice for both groups.
According to Kemp, the skips shout out “coded information to one another on a 140-foot frozen ‘sheet’ over which no one member of the squad can gain a commanding view alone.”
It’s basically the same on the trading floor — coded information is parlayed between groups, which is then interpreted and acted upon. To the uninitiated it may seem like chaos, but it is actually organized chaos with a final goal in mind, which is a successful trade. In effect, a trader tries to edge out a rival vying to take home the “money” by closing a deal.
A skip throwing last rock in an end tries to close the deal and chalk up the most points (money) on the score board. In the end, a curling team’s success is judged by having the most points (money) at the end of the game (deal).
It seems that outcome of a curling game is comparable to an outcome on Wall Street. Now, that’s something new to contemplate and quite fascinating.