D. E. Shaw didn’t seem likely to feel much impact from the troubles. By 1998, the hedge fund started by former Columbia University computer-science professor David Shaw with backing from investor Donald Sussman had grown to several hundred employees. Building on the statistical-arbitrage stock strategies Shaw had developed at Morgan Stanley, his company claimed annual returns of 18 percent on average since launching. On some days, it was responsible for about 5 percent of all trading on the New York Stock Exchange.
