The Hedge Fund Atop a Modeling Agency

According to a study by Stanford psychologist Brian Knutson,

When young men were shown erotic pictures, they were more likely to make a larger financial gamble than if they were shown a picture of something scary, such as a snake, or something neutral, such as a stapler.

Which leads to a question from Tyler Cowen:

One question -- and perhaps a more direct test of the hypothesis -- is whether traders in more sexually integrated firms do in fact behave differently. Or how about companies located next to modeling agencies? I suspect in real social settings the effect washes out, for reasons identified by Freud (among others) some time ago.

As it happens, I have a datapoint when it comes to hedge funds located in the same building as a modeling agency: Gramercy Advisors. It was started as a very small operation by a young trader called Marc Helie, who took some office space above the Elite modeling agency in Gramercy Park. Helie made more noise than money, and was eventually forced out of Gramercy by his partners, who then relocated to Greenwich and became much larger and more successful, while taking fewer risks.

Of course, it's hard to demonstrate the direction of the causality here: did Helie rent space above Elite because he was a risk-loving dashing young man, or did he take big risks because he rented space above Elite? Either way, however, it was clear that when Helie left the firm, the headquarters would not remain in downtown Manhattan for long.