Academia
As an academic at Berkeley in the 1960s, Niederhoffer wrote a number of influential papers on anomalies in stock market behavior. His paper Market Making and Reversal on the Stock Exchange (1966) made Niederhoffer the father of Statistical Arbitrage and of Market Microstructure Studies. He used innovative methods to search for opportunities in stock markets, such as his paper The Analysis of World Events and Stock Prices (1971), which used the font size of news print to determine the relative importance of news events and measure how they affected the stock market. He left academia in 1972 to concentrate fully on his other business activities.
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