Home Run Off a Curveball: Accident Turns Wall Street Trader Into Author

San Francisco Chronicle and SFGate.com, Tuesday, May 21, 2013

Thrown a Curveball, Trader Hits a Home Run, by James Robinson

January 2, 2011:  Joe Peta, a “baseball obsessed New York trader, was hit crossing a street by an ambulance in Manhattan, causing his leg to snap and leaving him in agony.  Peta, a former Lehman Bros. trader, was a graduate of Stanford’s MBA program.  When Lehman Bros. failed, he was hired by Nomura Securities.  Nomura fired him soon after his accident when he was confined to a wheelchair, the injuries still not completely healed.

Later, Mr. Peta, still in his apartment, was musing as “baseball’s Opening Day was approaching–and he still had a great deal of time on his hands.  Making a closer than usual examination of the statistics saturated Baseball Prospectus 2011, he began to get curious why the Tampa Bay Rays had been so surprisingly successful in 2010. Those questions would turn into a quest that would change the direction of his life.”

He began writing Trading Bases, a book about masses of baseball data which turned into a business plan.  “Baseball, Peta says, is a mechanical game.  Unlike other team sports, in baseball one player’s performance does not depend as much on a teammate’s…As opposed to basketball or football, each team in baseball really is a sum of its parts…player performance will not deviate a lot over the course of a season.  

Although baseball analysis of this sort began with Michael Lewis in the 1990s, Peta “might be the first person to use this information to create a pseudo-hedge fund that, instead of stocks, ‘trades’ in calculated wagers on each day’s baseball games. 

Trading Bases concludes with Peta raising $1 million and moving to Las Vegas for three months in 2012 to test his acumen, at his publisher’s insistence.  During the 2012 season, he says, he registered a 14 percent gain…Constructing the system behind Trading Bases has rekindled his youthful appreciation of the simple joys of baseball.”

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