With a district championship medal around his neck, 17-year-old Santa Monica High School junior Evan Hiltunen is a tennis prep star. He’ll be competing in the CIF Tournament this week along with his doubles partner, Nikola Hatch.That however, is not the most impressive thing on his resume.
What stands out among anything else Hiltunenhas done in his high school career is starting up and running an actual private hedge fund along with fellow 17-year-old junior Nick Gottlieb. If that’s not an indication of either one’s own genius or educational institutional success, what is?
Both kids grew up with a family background in the business world. Hiltunen’s father hasWall Street experience and also managed bonds for TD Ameritrade for 20 years. Gottlieb’s father was also a hedge fund manager and the example in which the two teens looked at as the template for their success.
After his bar mitzvah,Gottlieb was sitting on $3,500 cash and at didn’t know what to do with it. Heeventually picked up business traits and became a natural at it with small ventures of his own.
“It was actually really funny,” Gottlieb said. “I remember going to the post office when I was 16 years old to file my tax return, and having everyone there surprised that I was already paying taxes.”
Their true education steamed from their entrepreneurial endeavors. Hiltunen made his first stock market investment in the seventh grade and saw it grow by 25 percent. Before that, he ran his first business selling electronic accessories online that he would buy in bulk from Chinese wholesale companies for cheap.Business is in his bloodand hewas always the mathematical standout in his class since elementary.
Hiltunen and Gottlieb met in their sophomore year through their fascination of the stock market. In April of 2014, they decided to join forces and start their own hedge fund that they now call Alpha Bay Capital.
They got their company incorporated in Delaware with the help of Gottlieb’s father, who took care of all the regulatory and legal matters since the two are still minors. Then they got sponsored by TEDx youth for their own home office in the ROC (Real Office Centers) in Santa Monica. Hiltunen’s described his role in the hedge fund as the account executive who brings in the customers and keeps them up to date. He even takes them to dinner.
It may sound farfetched and even quite possibly a burn at the egofor an adult to trust a kid with their hard earned money to go invest in the stock market with the expectations of achieving capital gains. However in Santa Monica, fortune favors the bold, and investors of all ages have sought out these two wonder kids for both their brains and their boldness.
“Our customers like to invest with the younger people because we’re willing to take risks,” Hiltunen said. “So we’re investing in stocks that have a higher beta, which means they move up a lot faster than the market does. For example, if a stock has a beta of two, the market moves up 100 points, this stock will move up 200 points but also if it goes down 100, it’ll go down 200. So we like to mess with those and we’re really confident in what we invest in.”
Despite not even being old enough for happy hour, Hiltunen and Gottlieb have a wealth of trading experience and claim the track record to back it up as well.
“The numbers is what makes it count,” Hiltunen said. “It does not matter of the age. You can invest with someone who is 50 years old and doesn’t have the numbers but you would invest in him because you think he has the experience.”
“I was always good with numbers and [Hiltunen] has always been great with graphs,” Gottlieb said.
“This has made us an amazing team, we get both sides of the analysis. In recent months, Evan has transitioned into account executive. This means that his main job is gaining new clients making sure that they want to keep investing with us. I manage more of the accounting and analysis side of things, as I have a lot of experience with that.”
One could only imagine how far their business will go by the time they both go to college. Each have family legacy at the University of Michigan and both share a dream of going there. Their other top choices are New York University and Boston University.
Hiltunen said he’ll likely go into finance to learn some much needed traits in business. The purpose of college for him is the experience and a chance to finally get a break from California where he has spent his whole life.
With their small business growing, Hiltunen and Gottlieb ran entrepreneur clubs in school teaching others the art of the trade as well as holding a paper trading contest to see who is worthy of interviewing for a position for Alpha Bay Capital.
Even that is not enough. The two are working on new business ideas that will soon hit Santa Monica. If Hiltunen could get products from China, slap a logo on it, and sell it online before growing out of Pokemon, it may not be long before he becomesSanta Monica’s next business tycoon.
Tony Capobianco started the SMDP column “Cap Space” just in time for the 2014-15 Clippers season. You can contact him via email at firstname.lastname@example.org.