There's no magic behind creative thinking. You're born to do it. Keep asking: "why doesn't it work"…"what should I change to make it work"…Normal thinking is rich and complex - so rich and complex that it can yield extraordinary resultswrites Kevin Ashton, spanning over evolution, philosophy, psychology, neuroscience…Two pages are about Steve Job's "secrets" (be never satisfied?)
Innovation makes our species different
Behavioral neurologists may say: yes, there are talents, but the neurological principles of creative behavior are the same among us - we all have creative minds. I agree. Creativity is a special class of problem-solving…characterized by difficulty, unconventionality, novelty…but it needs (some) competency and I ask: can you buy competency? Yes you can.
Wheels aren't hard to invent, are they?
Original thinkers often look for adventure and start thinking not reading (eschewing algorithmic and technological fruits available). This is great for explorative learning, but it may reduce the value of the innovation - in quality or delivery time?
The innovative spiral drives faster if you push new, validated theorems...into the knowledge base and use them in a next turn. This white box - black box principle is very general, but especially powerful in quantitative fields.
What makes quant innovations work?
What are the units of quant innovations and what are their generic building blocks? IMO, the basic units are functions, the most important units are tasks. Functions create tasks…tasks create workflows and workflows create subsystems and subsystems create the system - the quant innovatio. The structure may be more sequential or nested. In quant finance it's quite nested.
It is my strong belief that a quant innovation does only work, if it is developed the bottom up fashion and that each unit has building blocks that are constructors, management of progressive problems (with critical moments), solutions and their interpretation.
Functions tune the mechanics of tasks, workflows, subsystems, the system and they are the "media" of actors. They define the coverage and the depth of the system. Their programming style shall be symbolic, functional…but their implementations shall combine symbolic and numerical computation.
Tasks have usually a time dimension and they move objects and actors. Tasks shall offer a clear shift (change) throughout its flow. Comprehensive tasks may be: financial market data selection, curation and import...model validation…instrument pricing with xVA...portfolio across scenario valuation... VaR calculations, stress tests…risk data analysis and aggregation…a task is a subject of event modeling…a task oriented language as well as the data representation need to know events…again a symbolic language serves this requirement…
Workflows are responsible for the management of progressive problems. They may deal with the analysis, prediction or control of processes…in workflows we may use generic tasks like, "Create", "Select", "Apply"…Data, Instruments, Models, Parameters, Valuation Methods, Portfolios, Scenarios, Risk Factors…
Subsystems and the system are created by workflows…sub systems are add-ons if they're built atop another subsystem (a platform).
This are the ideas behind UnRisk Quants. Develop a cascade of innovations that work and empower us unfolding creativity based on growing bank-proof systems, technologies…and make the same stack available to the most busy people in quant finance - quants. Help them making their deadlines. Offer new kinds of insight partnerships.
