The Hedge Fund Wizard Betting Big on Big Data Research

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Jaffray Woodriff knows a thing or two about data. The investment whiz based in Charlottesville, Virginia, used his homegrown predictive models of investment data to build a $4 billion-plus managed futures firm. Paying tribute to his golden goose, the investor just made a $10 million gift to advance the emerging field of data science.

Woodriffs private Quantitive Foundation recently pledged the grant to his alma mater, The University of Virginia, to endow its new Data Science Institute. a cross-disciplinary center that will focus on interpreting meaning from and using the heaps of data drawn from arenas such as e-commerce, environmental monitoring, and finance. The university will also provide $7 million to the endowment.

I believe it will pay tremendous dividends for the students, the commonwealth and society in general, Woodriff said in a statement.

And dividends are his thing. Woodriff grew up on a farm in Virginia, and after graduating from UVA, taught himself trading out of his apartment. He did pretty well for himself, and with his friend Michael Geismar, co-founded Quantitative Investment Management (QIM), which has since skyrocketed to more than $4 billion in investments and the top of many investors lists of funds to watch. (Fun fact about Geismar: In 2012, he went to a hedge fund conference in Vegas and went home with $710,000 in blackjack winnings .)

Woodriff has been described as monastic, working isolated in a windowless room, monitoring the computer models that lie at the heart of QIMs successful investments. They have staff, but Woodriff makes the predictive models and adjusts them over time by himself. What exactly do they do? No idea! Its dizzying stuff. As one investor told a writer in 2009:

I have had clients visit QIM to try to understand how its models work, but few have ever come back and said they had a thorough understanding of their methodologiesand these are very smart people.

With his $10 million endowment in the Data Science Institute, Woodriff is hoping some other very smart people can help make sense of the river of numbers that increasingly rules all of our lives. Data science research focuses on some major transformations happening in society. We are collecting and storing massive amounts of data from our many systems, and are increasingly able to make powerful mathematical models to make that data useful in science, engineering and other applications. The center will offer instruction and research across such fields as engineering, science, medicine, business, ethics, and computing; the institute is also developing a masters, an undergraduate minor and eventually a Ph.D. Program.

Learn more about Woodriffs foundation here and about the Data Science Institute here. Jaffray Woodriff has a blog. and he’s on Twitter .

Thursday, February 6, 2014 at 10:07AM