Morning Coffee: Why banks can’t decide whether to hire or fire you. Jes Staley’s prankster shares psychological insights

May 22, 2017, 4:07 pm

≫ Next: The former Citigroup MD trying to bring bankers out of the dark ages

≪ Previous: What do analysts, associates, VPs, and MDs actually do in investment banks?

Banking careers are not for the fainthearted. Jobs are typically insecure and finding a new one can involve a tortuous process that ultimately comes to nothing. However, try seeing things from a bank’s perspective. When you’re an investment bank, making new hires – especially expensive ones at the senior end, is fraught with peril.

“It’s an art, not a science,” one senior banker tells the Financial Times of his firm’s approach to headcount. “You don’t want to be too big, there’s a lot of cost to that, but you don’t want to be too small, you want to be able to leverage when things take off again . . . ”

If you’re a bank, deciding whether to hire or fire is also harder than it used to be. In the past, hiring in banks often came in waves with banks adding staff (or jettisoning them) in unison. Nowadays, the senior banker tells the FT things are different: because banks have different strategies with different clients and business mixes, hiring is more idiosyncratic. Each individual bank has to decide whether to recruit in its particular niche, and this can be more scary than stampeding after talent with the rest of the herd.

Even so, the FT detects some herding in Asia Pac, where it claims banks are now adding staff again: Goldman Sachs has just opened a Shanghai office and wants quantitative salespeople, Morgan Stanley wants to hire in Australia, Deutsche wants to hire TMT bankers. Even Barclays, whose new strategy is supposed to be focused on the UK and the U.S. is sniffing at Asian expansionism (again): the FT says both CEO Jes Staley and investment bank chief executive Tim Throsby have been to Hong Kong twice in the past year.

Separately, the 38 year-old web designer who tricked the Barclays’ CEO into thinking he was Barclays’ chairman John McFarlane, has been sharing his tips with the Financial Times. First, he says you shouldn’t be afraid of using a Gmail address (he used john.mcfarlane.barclays@gmail.com): most email software doesn’t automatically show the full email anyway. Secondly: write, “Sent from an iPhone,” after your hoax message to excuse the absence of a corporate email sign-off. Thirdly, “Keep it short to begin with and ideally reference something that will ring true. People accept a bit of bizarre once they feel they’re in the saddle of the communication.” These techniques won’t work at Barclays again though: the British bank has tightened its security procedures and staff receive warnings when they’re emailing outsiders since Staley’s mistake.

Meanwhile:

High frequency trading firm Virtu has completed its purchase of KCG Holdings and is making 10% of staff redundant and closing offices in Singapore and Mumbai. (Bloomberg)

Average bonuses for London-based investment bankers fell to £100,000 this year from £115,000 in 2014, while payments for front line asset managers jumped to £103,000 from £56,000 over the same period. (Financial News)

European supervisors want Deutsche Bank to prepare a fallback plan to lay out how it could shift the clearing of trades from London. (Reuters)

Barclays is hiring 100 new private bankers across London, Dublin, Geneva, Monaco, India, Dubai, Jersey, Guernsey and the Isle of Man. (Reuters)

Morgan Stanley’s stock rose 33% last year. In the circumstances, paying James Gorman an extra 7% is fine. (Reuters)

Mizuho is building its corporate bond business. It wants to hire 10 more people outside Japan this year (market conditions permitting). (Bloomberg)

Two women in pursuit of £3k allowed themselves to be ridden as horses around Poundland for 2.5 hours before discovering they had been hoaxed. (Devon on Line)

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

““

↧

The former Citigroup MD trying to bring bankers out of the dark ages

May 23, 2017, 1:35 am

≫ Next: Meet the equities hedge fund hiring associates from Goldman Sachs and UBS

≪ Previous: Morning Coffee: Why banks can’t decide whether to hire or fire you. Jes Staley’s prankster shares psychological insights

Since quitting his job as head of macro structuring at Citigroup in June last year, Huy Nguyen Trieu spends his time thinking about fintech. He’s a mentor, a lecturer and a prolific attendee of the hundreds of fintech conferences taking place around the world.

He’s learned one key thing – people working in banking are panicking.

“Every day, I get emails from former colleagues, senior bankers or traders who have no idea what the future holds,” he says. “I can’t keep up with them all.”

In the age of automation, quants are taking over. Artificial intelligence, big data, blockchain – all of these are looming over traditional finance jobs and striking fear into the hearts of senior and junior bankers alike.

“There are people who’ve been bankers for a long time who don’t really know where to start in order to adapt to the new landscape, but juniors are also worried,” says Nguyen Trieu. “There’s a huge amount of information out there, but the key is finding out what’s relevant to your job.”

Nguyen Trieu has been involved with various fintech organisations for the past two years including Start-up Bootcamp and Canary Wharf fintech accelerator Level39. He also lectures on fintech at Imperial College London and Said Business School, and also runs his own firm The Disruptive Group, which advises senior bankers on how to deal with new technology.

Now, together with his wife – former UBS wealth manager Tram Anh Nguyen – he’s just launched the Centre for Finance, Technology and Entrepreneurship (CFTE). This is a new online education platform, which aims to equip finance professionals with the tech skills they need to survive.

“People talk about trading jobs disappearing because of AI, or compliance and operations jobs being wiped out by blockchain,” says Nguyen Trieu. “There are threats, but we also think that there are big opportunities for people who can acquire the right skills.”

The courses on offer will be everything from ‘fintech 101’ to very technical courses on how artificial intelligence will impact trading jobs, says Nguyen Trieu. Claire Calmejane, director of innovation at Lloyds Banking Group, and Janos Barberis, founder of Hong Kong fintech accelerator, SuperCharger, are advising on the curriculum. Nguyen Trieu says eight other academics and bankers are involved, but can’t be named currently because of compliance reasons.

Nguyen Trieu says there are two main areas of concern for people who work in finance. For senior executives, it’s about understanding the ‘ecosystem’ and how the company needs to adapt.

“Look at companies like XTX Markets taking FX market share from big banks, or Marketaxcess eating up bond revenues – technology has lowered barriers to entry to these markets. The big investment banks are still figuring out how to react,” he says.

For rank and file employees, the bigger concern is how you can remain relevant as technology encroaches on more and more business areas.

“It used to be that you’d specialise in one area – you could be, say, the best sterling swaps trader, and your technical knowledge was the most important thing,” he says. “Now, you have to understand the technology innovation process alongside this. If you don’t, these jobs will be gone in a few years.”

“There are a lot of people working in finance who are lost – they need to understand technology, and they have to start somewhere,” he says.

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

Image: CFTE

““

↧

Meet the equities hedge fund hiring associates from Goldman Sachs and UBS

May 23, 2017, 2:51 am

≫ Next: Questions to ask at a Barclays interview, by Deutsche Bank

≪ Previous: The former Citigroup MD trying to bring bankers out of the dark ages

If you’re a junior banker looking to move to a hedge fund, you might want to give Alvaro Ventosa a call. The veteran hedge fund manager set up Alvento Capital, a long/short equity fund focused on utilities, renewables, infrastructure and energy back in 2015. In the past month, he’s been hiring new staff from investment banks.

Ventosa just recruited Jon Puckhaber, a former associate in the financial institutions group (FIG) at Goldman Sachs. Puckhaber’s joining as a senior equities analyst.

Ventosa also hired Hugo Liebart, a former associate director at UBS. Liebart was an equity researcher covering the utilities sector and UBS’s lead on renewable stocks. He joins Alvento as a senior analyst.

Before setting up Alvento, Ventosa was one of the founding partners at Cygnus Asset Management and a former adviser at CF Partners, a trading house and asset manager also focused on the energy sector. Several former CF employees also joined Alvento, including Nicholas Frolich, the former head trader at CF and now head trader at Alvento.

Alvento’s only publicly available accounts, for the year ended 31 March 2016, show a turnover of £874k and a profit of £192k distributed among seven partners. At that stage, it wasn’t exactly one of the best paying hedge funds in London, therefore.

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

Photo credit: hedge door by Helen Cook is licensed under CC BY 2.0.

↧

Questions to ask at a Barclays interview, by Deutsche Bank

May 23, 2017, 4:05 am

≫ Next: This hedge fund has just paid its senior staff £3.7m after an amazing year

≪ Previous: Meet the equities hedge fund hiring associates from Goldman Sachs and UBS

Barclays is back on the hiring wagon. Tim Throsby, head of the investment bank, has appointed himself head of the global markets division too and is said to be recruiting 50 to 100 people, some of whom have already arrived.

Is it ‘safe’ to join Barclays now though? In the past decade the British bank has achieved a reputation for hiring and then firing. The FT’s claim today that Barclays is sniffing around Asia again (after shutting part of its Asian business and declaring itself a US and UK-focused investment bank), suggests a continuation of the same old cycle. On the plus side, however, Barclays insiders say things are looking up now that ex-CEO and retail banker Antony Jenkins’ is a distant memory and Throsby has a growth plan.

Nonetheless, if you’re thinking of working for Barclays you might want to ask some pertinent questions about strategy. Helpfully, Deutsche Bank’s team of banking analysts – who were pretty keen on Barclays’ investment bank only a few months ago – have issued a set of questions for Barclays’ management which we’ve parsed below. You could always ask them, gently, at the end of a Barclays interview…

1. How sustainable are revenues in the investment bank?

Revenues at Barclays’ investment bank were ahead of expectations for 2016, with performance solid throughout the year. But the first quarter of 2017 was a miss because of the poor performance of your rates business. What’s the sustainable revenue level for Barclays’ investment bank? Are you continuing to grow market share?

2. What are you doing about Brexit?

What does Barclays plan to do in terms of passporting rights and Europe? How do you plan to maintain equivalent access to Europe if there is no passporting? What percentage of the business in your investment bank is done with European customers?

3. How big do you expect the investment bank to be relative to the rest of your business?

Barclays has been reducing the size of its investment bank in recent years. What’s your intended mix of the investment bank and the retail bank in future?

4. What’s the cost plan?

What proportion of the £1bn of costs associated with your structuring reform programme has already been expensed? How much is to come? How much flexibility do you have with the cost base of the investment bank? Are you expecting to increase investment in areas of the investment bank?

5. How are you coping with the requirements of your US intermediate holding company (IHC)?

What level of capital do you think your IHC needs to hold in the U.S.? Is this a problem? Are you expecting a similar regime in Europe after Brexit? What would be the implications of this for Barclays?

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

Photo credit: IMGP7424 by Matt Buck is licensed under CC BY 2.0.

↧

This hedge fund has just paid its senior staff £3.7m after an amazing year

May 23, 2017, 4:30 am

≫ Next: “I’ve worked in M&A in London & Frankfurt. This is the difference”

≪ Previous: Questions to ask at a Barclays interview, by Deutsche Bank

A lot of UK hedge funds cut headcount in the face of lacklustre performance and pressure on fees last year. Caxton Associates, the $8bn New York-based hedge fund, has been hiring in London regardless.

Newly released accounts for its UK LLP demonstrate why – it made £95.7m in profits last year, up from £15.8m in 2015 and £6.2m the year before. In other words, over the past 12 months, profits in its UK operation have increased by 504%.

Hedge funds usually run as limited partnerships in the UK, which means that any profits are poured back in the form of ‘member remuneration’. All of Caxton’s £95.7m was allocated to its partners’ pay.

However, Caxton, like most London hedge funds, has a number of entities registered with UK Companies House, which form different parts of its business. Caxton Europe Asset Management Limited is the main company that houses the majority of its employees, as well as being the member of the LLP to which it allocates most remuneration, usually to cover general expenses.

Last year, £58.2m went to its highest paid member, which is usually the parent company, leaving £37.5m for the remaining 10 partners – or a £3.75m average payment. Even in the context of partner pay in hedge funds, which usually stretches into seven figures, this is near the top of the pile.

Caxton added two members to its team last year, but has been hiring over the past few months and now has 56 people registered with the Financial Conduct Authority in the UK, up from 49 at this point last year.

Earlier this month, it hired Stuart McQuaid, who was most recently a trader at hedge fund Horizon Asset LLP, but has been adding money managers throughout 2017. James ter Haar and GJ Prasad, both portfolio managers at Millennium Management, joined in March, while Tom Frost, who was previously managing director and head of UK insurance and pensions at Credit Suisse, is its new head of business development for Europe and Asia.

Caxton reportedly gained 2% in the immediate aftermath of Brexit, but across the organisation it hasn’t been all positive. Like most macro funds, Caxton trimmed its management fees from 2.6% to 2.2-2.5% of assets in September last year amid mounting pressure from investors. Still, it remains among the more expensive hedge funds, with a 27.5% cut of any profits it makes.

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

““

↧

“I’ve worked in M&A in London & Frankfurt. This is the difference”

May 23, 2017, 6:23 am

≫ Next: How Madoff inspired an ex-Salomon and UBS investment banker to launch a fintech startup

≪ Previous: This hedge fund has just paid its senior staff £3.7m after an amazing year

If you live and work in banking in London, you probably don’t want to leave. – Especially for Frankfurt, which has a bad reputation among some people in the “City.”

Personally, I’ve worked in M&A for international banks in both cities. They both have their advantages and Frankfurt has more going for it than you might think. Don’t dread a move there, but don’t expect it to be like London either.

1. London’s an international city. Frankfurt’s a traditional town

London’s a global financial hub and a global city. Frankfurt is the second biggest financial hub in Europe, but you can feel the difference. Frankfurt is a lot more laid back and still retains its traditional cultural heritage. It’s also small – much smaller than London. This has its advantages when it comes to meeting up with people. However, it’s not that hard to meet people in London either – most bankers live in Zone One and the tube is a pretty efficient way of travelling.

2. London speaks English, Frankfurt speaks German

This might seem self-evident, but while London is an international city where everyone speaks English, German is still very much the working language in Frankfurt. There are some international bankers in Frankfurt who speak English, but they’re the exception, not the rule.

3. London is a cultural melting pot. Frankfurt is culturally homogenous

London is a place where different cultures come together. There are Britons, Germans, Italians. French, Americans. Australians, Asians and so on….London attracts the smartest and brightest people from everywhere and because of this you can build a brilliant network there. Frankfurt is far, far less international.

4. London is socially varied. Frankfurt is good for socializing with colleagues

London has a huge variety of bars and clubs. You can choose the more fancy West End or the more hipster East End. In Frankfurt, it’s a lot more limited. You can however, have good fun clubbing with a bunch of bankers when you finish work.

5. In London you eat at your desk. In Frankfurt you get an hour to do what you like

If you’re working in London, you’ll probably eat at your desk. For some reason, this is normal. London bankers sit there with their food and browse the web. This isn’t great: the office smells of everyone’s lunch.

In Germany, this would be considered anti-social. One hour lunches, outside the office, are standard in Frankfurt.

6. In London it’s hard to meet people at other banks. In Frankfurt, it’s easy

If you’re working in M&A in London, you’ll probably hang out with colleagues from your own bank after work. Because the finance industry is spread across the city – in Canary Wharf, the City of London and Mayfair – it can be hard to socialize with people from other firms in other areas.

In Frankfurt, this isn’t a problem. Around 90% of the meeting and greeting between M&A bankers happens in one street – the “Fressgass”. Go there, and you’ll meet almost everyone.

7. In London, you’ll pay a fortune to live. In Frankfurt it’s cheap by comparison

If you’re working long days in banking in London, you’ll probably want to live in Zone 1- close to the office. However, you’ll have to pay for this privilege. In my experience a rented flat in Zone 1 can cost double (ore more) the price of a comparable flat in Frankfurt. You’ll also end up spending a lot more in London when you go out to bars or restaurants after work.

8. London bankers are mad about sports. Frankfurt bankers are more relaxed

London bankers have a culture of playing sport and visiting the gym. In the summer, it’s not unusual to run to work. At lunch, it’s not unusual to go to the in-house gym, which can be nice if you don’t mind seeing your colleagues pumping iron. For this reason, most London banks have showers on site. There’s a lot less of this in Frankfurt.

9. In London, you’re expected to drink with colleagues after work. In Frankfurt, you go home

In London, “pub culture” is deeply entrenched. After a hard week, it’s usual to go to the pub with colleagues and have a few pints on Friday evening. There’s no excuse for avoiding this as pubs are ubiquitous in London. In Frankfurt this doesn’t happen – although it’s a ritual that the city could benefit from!

Alex graduated from the University of Mannheim and Frankfurt School of Finance & Management. He worked as an analyst in investment banking in London and now works as an M&A professional in corporate development in London. Prior to that, he gained investment banking working experience in London and Frankfurt. Alex is now dedicating his time to sharing career advice via the ‘M&Academy’ platform, where he discusses how to get into M&A, ECM, corporate development, private equity and leveraged finance.

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

Photo credit: Frankfurt by barnyz is licensed under CC BY 2.0.

↧

How Madoff inspired an ex-Salomon and UBS investment banker to launch a fintech startup

May 23, 2017, 7:06 am

≫ Next: Further reports of big buybacks when people try leaving Deutsche

≪ Previous: “I’ve worked in M&A in London & Frankfurt. This is the difference”

David Shulman was an investment banker for more than 30 years and never came into contact with Bernie Madoff, but he was inspired by the notorious fraudster – as well as his own experience dealing with accusations of insider trading at the start of the financial crisis – to launch a fintech firm that detects the potential for white-collar criminality among new recruits in financial services.

Shulman, who was most recently global head of municipal securities sales and Americas head of fixed income at UBS, now runs Veris Benchmarks, a firm that screens candidates for moral fiber and their degree of similarity or difference to white-collar criminals.

“I was in tune with human resources – I worked very closely with the HR department [at UBS], because I had an interest in the hiring and development of talent,” Shulman said. “I forged a close relationship with HR during that time and led me to my interest in launching Veris.”

“UBS put me in charge of the fixed income department of the investment bank, where municipals were a significant drain, and due to the capital needs for the company, which was going through a lot of stress, the bank decided to wind down the [municipal securities] department,” he said.

Shulman himself has also been involved with some allegations of insider trading. In 2007, Shulman was riding high when his employees started sounding alarm bells about student-loan-backed auction-rate securities. A couple of days later, he allegedly sold off $1.45m worth of auction-rate securities before their market crashed in early 2008, the New York Times reported.

After an investigation by New York’s then-attorney general (now-governor) Andrew Cuomo, Shulman agreed to settle insider trading charges by paying a $2.75m fine, neither confirming nor denying guilt. He was also suspended from employment in the industry for close to a year.

“That was a low point,” Shulman said. “Back in 2008 when the Madoff scandal happened, I had a number of family and friends who were direct investors with Madoff, and I knew one of the Madoff sons, Mark [who committed suicide in 2010], so it hit so close to home.

“Given my involvement in the hiring and HR functions and the management of these global financial institutions, I decided to analyze what companies were doing that were acting in the capacity of a fiduciary in charge of stewarding money or people, basically firms in a responsible position to handle life assets,” he said. “I realized that there was nothing geared toward a higher IQ segment to really address these issues – companies do background checks and drug tests, but unless they really understand candidates and the people who are serving their customers, they couldn’t measure what I call ‘moral fiber.’

Are you more principled than a white-collar criminal?

Currently the Veris Benchmarks’ pre-employment assessment tools include a questionnaire consisting of 149 questions that are scored against a benchmark, which the firm created by testing actual white-collar criminals in prisons across the U.S. Hiring managers and HR executives can use this data as another variable in candidate assessments to understand prospective employees a little bit better and avoid hiring fraudsters or thieves.

“They are able to use this in conjunction with other assessments such as logic tests, background checks and interviews as another input into the calculus of whether you’re going to hire this potential employee,” Shulman said.

“An organization’s reputation is precious and all it takes is one or two bad apples to destroy the reputation of firms that have taken years to build up trust with clients – how could you not want to know that information?” he said.

The traditional Wall Street interview process is overdue for an overhaul

Since launching Veris, Shulman’s views have changed dramatically on the typical interview process at Wall Street firms.

“I’ve interviewed hundreds of candidates over the years, and what I’ve realized after my exposure to some fairly advanced financial services companies, the days of the standard interview questions that drove Wall Street hiring are yesterday’s news,” Shulman said. “Interviews are helpful but rife with bias – the standard interview process is not objective at all – it introduces biases that are not fair to the candidate.

“Unless you have a professional who is skilled in the interviewing, it can be a very biased experience, whereas the technology today can help interviews to be more objective and hold things constant,” he said. “Companies say it’s all about data, so having these employees take competency tests early on makes sense – meeting the person to determine whether they fit culturally in the company should be the last step in the process, not the first step.

“The more information you have, it makes it a more pure decision before that candidate ever walks through the door. Many firms continue to send people around to six or even 10 or more interviews and people say ‘I like his tie’ or ‘I liked her dress,’ ‘We went to the same school’ or ‘We played the same sports’ – that needs to be removed from the process to find thought-leaders and good quality employees.”
Follow @danbutchrwrites

Photo credit: g-stockstudio/GettyImages
““

↧

Further reports of big buybacks when people try leaving Deutsche

May 23, 2017, 9:39 am

≫ Next: The one place to work in investment banking now

≪ Previous: How Madoff inspired an ex-Salomon and UBS investment banker to launch a fintech startup

As we reported a few weeks ago, Deutsche Bank is said to be averse to people leaving: if the German bank likes you and you get an offer from a rival bank, it might bid you back for significantly more than you’re earning currently.

How much more? One DB insider says he got an uplift of 35% on his base salary, plus a guaranteed bonus for this year when he dangled an alternative offer.

Deutsche doesn’t comment on pay, but if true the claims could create a headache for the German bank at the next bonus round. Deutsche has promised its staff that last year’s withholding of performance related bonuses was a one-off, creating an expectation that pay will return to normal for 2017. However, if enough existing Deutsche people resign and are bought back again – or enough new people are hired on guaranteed bonuses – then the 2017 pay pot will be depleted from the outset. Deutsche bankers who aren’t on big guarantees could find themselves at a disadvantage.

Not everyone who leaves Deutsche is getting a big pay uplift though. One NY headhunter, speaking on condition of anonymity, says the bank isn’t being “too aggressive.”

“There’s no doubling of salaries or multi-year guarantees – just enough of an uplift to keep people sitting at the desk.”

One bank targeting Deutsche staff is Credit Suisse. After a miserable performance last year, CS is trying to reinvigorate its equities business with new blood. It’s already hired Stuart McGuire from Deutsche as head of EMEA cash equities sales and trading along with two senior Deutsche equities executives in Asia. Deutsche, in turn, hired a new head of U.S. global markets client strategy from Citadel’s equities unit in April.

Deutsche set out to hire 100 equities trading staff last year, but the NY headhunter said some of the bank’s most desirable Wall Street employees are in its Delta one business.

London headhunters said Deutsche isn’t alone in trying to retain its existing staff. “Deutsche have made themselves a bit of a target, but we’re seeing aggressive bid-backs everywhere this year,” says one macro search specialist. “There’s been so much cost cutting that there aren’t many people realistically left to choose from, especially at the senior end. Because it’s more painful to hire, it’s also more painful to lose people – banks would rather keep hold of them.”

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com
“”

Photo credit: The Golden Cuffs by H. Michael Karshis is licensed under CC BY 2.0.

↧

The one place to work in investment banking now

May 23, 2017, 4:01 pm

≫ Next: Morning Coffee: The quirky $650k job that doesn’t require a degree. How to slap down a prankster with style

≪ Previous: Further reports of big buybacks when people try leaving Deutsche

Investment banks have stopped making massive cuts to their fixed income divisions, but there’s only one place where they’re really hiring – credit trading.

“There’s not a single investment bank that’s not speaking internally about competing in credit trading,” says Amrit Shahani, research director at Coalition. “There’s been strong enough revenue growth consistently to generate hiring.”

Coalition has just released its quarterly index for investment banking, and headcount is still heading down in the front office, despite the stellar first quarter for most firms’ fixed income divisions.

In the first quarter of this year, 300 roles disappeared across banks’ FICC, equities and investment banking divisions during the first quarter of 2017, it says. Overall, 1,900 revenue-generating jobs have gone from top investment banks since Q1 last year, and nearly 13,000 roles have disappeared over the past five years.

Screen Shot 2017-05-23 at 17.27.13

“Generally, banks have stopped cutting, except in equities – particularly in Asia – but a lot of cuts in the second half of last year were booked in Q1 2017,” says Shahani.

Year on year, credit revenues were up 65% year on year across the 12 large investment banks Coalition tracks, to $4.7bn. This is still equal to the revenues generated in Q1 2015, and far less than the $7bn+ in the first quarters of 2012-14.

“Smaller banks like HSBC, UBS and BNP Paribas are staffing up in credit. Everyone is trying to compete,” says another research analyst who declined to be named.

Smaller players have clout when it comes to hiring – BNP Paribas, for example, has just poached Goldman Sachs bond traders Robert Boeheim and Eusta Qin. Isabel Mahony, the former co-head of credit trading at Morgan Stanley, joined Japanese bank SMBC Nikko Capital Markets earlier this week.

Screen Shot 2017-05-23 at 17.21.30

Elsewhere, investment banks are also hiring for their G10 rates trading teams, although Shahani says it’s much more selective.

Kumaran Surenthirathas, founder and managing director at headhunters Rosehill Search, which focuses on FICC, says banks are “hiring but not expanding”.

“One good quarter does not warrant the huge costs of expansion. They’re still making less money than they were ten years ago, juniorisation is still happening and a good quarter means that people aren’t getting fired. Hiring is still very selective,” he says.

Shahani says that banks FX desks continue to shrink because of “electronification and smaller tech savvy players gaining market share”, while commodities – where revenues declined by 29% year on year – is in “structural decline”.

“What we’re seeing now is a general improvement from a very low base,” he says. “The second half of last year was strong, so if we see improvements for the last six months of 2017 it’s likely that banks will start hiring again in more significant numbers.”

Screen Shot 2017-05-23 at 17.27.00

Screen Shot 2017-05-23 at 17.27.06

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

““

↧

Morning Coffee: The quirky $650k job that doesn’t require a degree. How to slap down a prankster with style

May 23, 2017, 10:00 pm

≫ Next: The Brexit effect on competition for banking jobs in London

≪ Previous: The one place to work in investment banking now

Chances are that if you’re working for an investment bank, hedge fund or private equity firm, you’ll be highly-qualified (or at least attended a top university) and towards the upper crust of society. Yes, these jobs are (very) well-paid, but you deserve it, right? You’ve got the qualifications and beat hundreds of thousands of other applicants to the role.

But what if you could be in the top 1% of earners without even going to university. Bloomberg has been given an insight into the ‘wheeler-dealer’ world of London’s Clerks, a role that acts as a kind of broker between solicitors, which provide legal advice, and barristers who deal with the action in court. It’s a Victorian-era profession, which you can get into as a teenager with no formal qualifications. Oh, and earn around £500k ($650k) a year.

Clerks’ role is essentially ensure that solicitors direct work towards barristers – or, as some barristers call it, acting as a pimp. The downside is that these roles are subject to their own quirks and rules – no two Clerks can share the same first name, which means newbies often have to give up their Christian names if it clashes with an existing member of staff. Then there’s the ‘trollies’ – every morning junior clerks lug heavy boxes of legal documents around the streets of London, up and down stairs of antiquated buildings. Still, no slow encroachment of technology here, but also not many women Clerks.

One advantage is that Clerks, often from working class backgrounds, get to exert some power over the private-school educated barristers who rely on them for a steady supply of cases at the right price. There’s also the more unsavoury side – Bloomberg reports incidents of Clerk’s being asked to dress a boil on a barrister’s back, or countless stories of being asked to buy gifts for barristers’ mistresses. Every job has its downsides.

Separately, while the world worries about malware attacks, top bankers should be more concerned about hotmail or gmail. Bank of England governor, Mark Carney, has been duped by the same email prankster who tricked Barclays’ CEO Jes Staley into believing he was having an exchange with the bank’s chairman John McFarlane. This time, the 38-year-old web designer from Manchester pretended to be Anthony Habgood, the chairman of the Court of the Bank of England, by using the fake email address anthonyhabgood@hotmail.com to converse with Carney. After a brief exchange about the drinking habits of Eddie George, the former Bank of England governor, ‘Habgood’ steered the conversation towards a personal party and the use of “dashing bar ladies”. Carney slapped this down: “Sorry Anthony. Not appropriate at all.” Then stopped replying.

Meanwhile:

How Jamie Dimon should have responded to angry shareholders: “I understand why people are upset by CEO pay. We earn a lot. That’s something that our board and compensation committee need to keep looking at.” (Financial Times)

Goldman traders have defected to BNP Paribas (Bloomberg)

Deutsche Bank’s global head of multinational coverage, Robert Snell, has left (Financial Times)

In Q2 Barclays will post the biggest drop, Morgan Stanley may gain, says J.P. Morgan (Bloomberg)

You can buy your lunch using bitcoin at Fidelity (Financial Times)

Time to move into insurance (WSJ)

Aberdeen Asset Management is hiring data scientists (Financial News)

Martin Wheatley, the former head of the UK’s Financial Conduct Authority, has just joined a hedge fund (Financial Times)

People are unusually confident in their abstract perception of time (NY Mag)

“There were certain pieces that if you went from hedge fund, to fund, to fund—they were always there. Always the Warhol dollar sign, the graphic Christopher Wool, ironic Richard Prince, the Robert Longo, and the Basquiat, always a Basquiat; it was like a checklist.” (Artnet)

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

Image: Getty Images

““

↧

The Brexit effect on competition for banking jobs in London

May 24, 2017, 3:34 am

≫ Next: I’m taking the CFA exam next week. This is what I’m doing to get through it

≪ Previous: Morning Coffee: The quirky $650k job that doesn’t require a degree. How to slap down a prankster with style

If you’re an experienced professional looking for a London banking and finance job in 2017, the Brexit referendum result has its advantages. It’s helped dissuade overseas candidates from applying.

Applications to London-based jobs from candidates in Italy, France and Germany are down 15%, 10% and 8% respectively year-to-date compared to the same period of 2016, according to figures from eFinancialCareers. Candidates based in the U.S. are not as dissuaded from applying – applications are down by just 2% over the same period.

The 2016 Brexit referendum took place on June 23rd, meaning 2016’s figures reflect pre-referendum applications while 2017’s figures show applications in the wake of the referendum. The associated decline in the value of the pound is also likely to have tempered candidates’ enthusiasm – although the c10% decline in the value of the pound against the euro since June 2016 appears to have more effect than the c12% decline in the value of the pound versus the dollar.

Brexit hasn’t put everyone off applying for jobs in London though. eFinancialCareers’ figures suggest that overseas applications from junior candidates with one to two years’ experience have actually increased since the referendum, particularly from the U.S., where the number of junior candidates applying for London jobs are up over 10% this year.

Anecdotally, European bankers at early stages of their careers still see London as the local repository of the best and most career-enhancing jobs. “London is the financial capital of Europe – and that’s still where you can get the best experience,” one young French banker told us late last year. ““Moving banks’ headquarters and thousands of staff from London to other European capitals will be a long process,” said another, adding that it’s too soon to start avoiding the City yet.

If junior overseas candidates are keener than ever on applying to London, the same can’t be said for experienced staff. With a few exceptions (France-based applicants with more than 20 years’ experience and U.S.-based applicants with between 11 and 20 years’ experience), applications from more senior overseas staff are down significantly on last year.

Does this make it easier to find a London finance job in 2017? Not necessarily. Most London job applications come from people already in the UK – some of whom are also EU nationals. Moreover, U.S.-based candidates make up over 50% of the overseas applicants for London banking jobs in our sample, and their enthusiasm for the City is less diminished.

Problems could arise in future though. If experienced European bankers continue to reduce their applications, banks in London may struggle to fill senior jobs requiring key native European language speakers – or to replenish experienced European talent as people return home. Then again, this might not be necessary: post-Brexit, most roles requiring an ability to converse with European clients are likely to move to European financial centres anyway.

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

““

↧

I’m taking the CFA exam next week. This is what I’m doing to get through it

May 24, 2017, 4:21 am

≫ Next: Top traders are leaving BNP Paribas as the bank hires from Goldman Sachs

≪ Previous: The Brexit effect on competition for banking jobs in London

The Chartered Financial Analyst (CFA) exam day is June 3. Here’s some advice from a Level II candidate, a Level III candidate and a CFA charter-holder for what you should be doing right now and on exam day in order to pass.

Incoming investment banking analyst attempting to pass Level II

Sergey Litvinenko is a 21-year old student about to graduate with his Master of Finance from Boston College. He’s focused on passing the Level II CFA exam. He said that he did not find Level I difficult in terms of content, but the challenging part was trying to cover every single topic and making sure he had a solid grasp of the material.

“My recipe was to read every single book from A to Z, do every single practice problem in those books, move on to practice tests, find weak spots, revise, rinse and repeat,” Litvinenko said. “It is quite intimidating to go through thousands of pages and try to keep everything fresh and interconnected in your head, but this is how it works.

Litvinenko is approaching Level II in the same way he did Level I. However since Level II has a slightly different structure, he decided to allocate more time to practice tests.

“I still read every book and do the practice problems, but it is taking a smaller portion of time compared to Level I,” Litvinenko said. “One of the reasons must be that there is some overlap between the exam and my previous finance studies.

“Also, when you deal with ‘short’ cases, it is imperative to pay attention to every single word said in a case,” he said. “If you miss something, you might go in a wrong direction – and again, it is not about the hard content; it is more about being able to consume a lot of information, make sense of it and keep a sharp focus.

Hedge fund associate attempting to pass Level III

Noelle Sisco, an associate at hedge fund Napier Park Global Capital, has achieved the Chartered Alternative Investment Analyst (CAIA) and taking the CFA level III.

Proper budgeting of time is key, Sisco said. Here are her three main tips:

Plan out how you intend to use May for studying and follow it – “Being able to check off my study to-do list helps recognize my accomplishments and increases confidence going into exam day.”
Find something non-work-related to focus on during study breaks – “I play various instruments so they help me wind down after a few chapters…golfing and fishing are other good go-to’s.”
Make her own study guide – “I have found this to be especially helpful. I am going through the full curriculum and writing my own study guide, because it helps to learn the material and I feel it helps to be able to reiterate it in my own words.”

In retrospect, there are a few things Sisco wish she had known in advance or done differently before and during the Level I and Level II exams.

“I wish I had a better idea of what the test day was like for the CFA Level I exam,” Sisco said. “When walking up to the test center that morning, there was a line all the way down the block of people preparing to enter the test center.

“I definitely didn’t realize how big it was, but the excitement of it all kind of made me like ‘game on,’” she said

CFA charterholder says not to overlook ethics – or lunch

Marco Sementilli, a portfolio design analyst at City National Rochdale, the investment management subsidiary of City National Bank, previously worked at UBS. He passed all three levels of exams and is a CFA charterholder.

From now until the exam, candidates’ focus should be on mastering ethics and completing as many practice problems as possible, he said.

“For all candidates, ethics is such an important part of the exam, but it is also arduous and time-consuming to master,” Sementilli said. “Reading through the Ethics and Standards of Professional Conduct section two or three times in May should leave candidates well prepared for the ethics portion of the exam.

“Practice problems will help to reinforce the material learned throughout the candidates’ studies,” he said. “A large part of the game for these exams is knowing how to answer questions accordingly, and there is no better way of doing this than by taking practice problems.

“The last piece of advice that I can give is to relax on the Friday before exam day – you’ve worked as hard as possible to get to this point and you need to have a fresh mind for exam day.”

“If at all possible, pack your own lunch for exam day because some of the larger testing centers, New York City, for example, will be a madhouse during lunch break with other candidates trying to get something to eat,” Sementilli said. “If you need to use the bathroom during the timed portion of the exam, raise your hand and do so.”
Follow @danbutchrwrites

Photo credit: AntonioGuillem/GettyImages
““

↧

Top traders are leaving BNP Paribas as the bank hires from Goldman Sachs

May 24, 2017, 6:04 am

≫ Next: Meet the ex-Goldman Sachs strats trying to tackle the biggest problem facing investment banks now

≪ Previous: I’m taking the CFA exam next week. This is what I’m doing to get through it

BNP Paribas is losing senior traders as it swaps staff with Goldman Sachs.

Headhunters say the French bank is parting company with Asa Atwell, its global head of G10 FX trading. At the same time, BNP has supplemented its existing stock of ex-Goldman Sachs traders with Robert Boeheim and Eusta Qin, a former Goldman sterling corporate bond trader and investment grade financials trader respectively. Bloomberg reported the latter moves early this week.

Atwell was promoted as global head of FX options trading at BNP in 2012 when the previous head of the business departed. The reason for his exit is unclear, although he’s not thought to be joining another firm.

The flow of talent at BNP goes both ways, however. While BNP is hiring in traders from other banks, it’s also losing them to rivals – Goldman Sachs included. GS is understood to have hired Darren O’Meara from BNP’s rates desk. Paul Mehta, a senior loans and distressed debt trader at BNP is said to have gone to Aberdeen Asset Management. And Paul Crawford, a senior sterling credit trader at BNP is said to be the latest arrival at UBS.

After cutting 233 London jobs last year, BNP Paribas has plans to expand its investment bank in Europe. Under ‘Strategy 2020′, BNP plans to achieve compound annual revenue growth across the CIB of 4.5% over the next three years.

Traders at the French bank had an excellent 2016. This may be helping to attract talent from elsewhere and encouraging “upgrading.” Goldman Sachs in particular appears to be losing sales trading staff this year, with UBS, Nomura and now BNP all poaching its people. As a result, and following layoffs last year, headhunters say Goldman is hiring. It already recruited Miran Serdarevic, Deutsche’s head of real money sales in London and is thought to have more senior hires lined up.

BNP Paribas declined to comment.

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

Photo credit: UK Headquarters of BNP Paribas, Harewood Avenue,. London UK by Roberto Herrett is licensed under CC BY 2.0.

↧

Meet the ex-Goldman Sachs strats trying to tackle the biggest problem facing investment banks now

May 24, 2017, 9:30 am

≫ Next: Do you really want to be a C# developer in a bank now?

≪ Previous: Top traders are leaving BNP Paribas as the bank hires from Goldman Sachs

Leo Labeis spent his final year at Goldman Sachs leading the bank’s efforts to comply with the long and sprawling requirements of MiFID II for its global markets business.

As the deadline looms next year, Labeis says one thing is clear – investment banks’ compliance teams are stretched.

“Compliance programmes are under very tight deadlines, in a rapidly shifting regulatory environment – it’s incredibly hard to keep up,” he says. “Technologists are consumed by individual projects, then immediately go on to work on the next thing. There’s little room to think strategically about how you tackle regulation, and this is even the case at Goldman where the programmes are well-run.”

Labeis spent 13 years at Goldman Sachs, working in senior roles across its strats division, including heading up its EMEA emerging markets trading strats team. Latterly, before leaving last year, he was global head of macro CVA and FX trading quants. He oversaw a team of dozens of quants and developers, taking responsibility for regulatory capital requirements and ensuring MiFID II compliance in its sales and trading business.

Most investment banks have been throwing people at the problem and hiring in people. Technologists who would have previously focused on innovative front office programmes have been shifted across to regulatory projects.

The sweep of MiFID II alone on banks tech teams is huge. Banks have to reengineer everything from algo engines, order and execution management systems to reporting and record keeping – just to keep the lights on.

“Investment banks have massively increased the number of people working in technology and control functions, but this just keeps pace with regulatory momentum,” says Labeis. “There’s also the question of cost – the entire industry is beholden to shareholder cost-control. They don’t have a free rein – there’s only so many people you can hire.”

Labeis, together with Pierre Lamy, a former managing director in FICC technology at Goldman Sachs, has just launched a new regulatory technology start-up called REGnosys.

The idea, at least initially, is to solve the problems large investment banks are facing complying with MiFID II on the trading floor. It provides a “canonical representation” of business processes – namely converting them into a standard format – across all investment banking markets divisions. It then converts them into programmable code that’s easily auditable for regulators, and also makes them available on an open source domain, so that compliance is fully transparent.

This is one of the main issues that banks face when it comes to compliance. There are teams working across divisions and functions in “parallel streams”, says Labeis, which means that technology around regulatory compliance has become “too complex and opaque to be auditable”.

So far, it’s attracted a lot of industry interest. The two founders raised $900k in private funding – largely, according to Labeis, from senior investment bankers and private equity professionals. The firm is currently speaking to “most bulge bracket banks on the street”, says Labeis, initially with the aim of confirming the technology with a product around MiFID II compliance.

REGnosys currently has four employees and is likely to start recruiting for business development roles in the future. Labeis says that 70-80% of staff will be software engineers. So far, most have come from investment banks. Jim Wang, a former executive director in interest rates technology at Goldman Sachs, joined earlier this month, while Minesh Patel spent 15 years in banking technology – latterly at Mercuria – before joining REGnosys.

“We want experienced technologists who have seen it all and done it all in investment banks, are regulatory specialists who understand the problems banks are facing,” says Labeis.

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

Image: Getty Images

““

↧

Do you really want to be a C# developer in a bank now?

May 24, 2017, 10:05 am

≫ Next: Morning Coffee: The 27 year-olds getting 3 hedge fund offers a week, and how to become one

≪ Previous: Meet the ex-Goldman Sachs strats trying to tackle the biggest problem facing investment banks now

Once upon a time, C# developers in investment banks were it. Banks used windows-based systems for their user-interfaces and they used window-based systems for their servers. If you could code fluently in C# within the .NET framework, you could work in either the front end or the back end. Nowadays, C# is very slowly being displaced in both.

“Most banks primarily use C# only for front-end development,” says Peter Wagner, a former VP in credit derivatives technology at Morgan Stanley and managing director of search firm Affinity North. “- The majority of their server side software is Linux-based. At the same time, front end development is quickly migrating to Javascript and web-based technologies, so C# in this context is quickly falling out of favor. ”

Goldman Sachs is a case in point. Of 21 technology jobs currently being advertised by the bank in London, 50% require familiarity with Javascript and Angular technologies. Just three require knowledge of C# and .NET.

Mike Baxter, a consultant at London-based tech recruitment firm Caspian One specializes in recruiting C# developers for investment banks. “Three years ago, you had very high paying contracts for C# developers writing interactive user interfaces for banks’ risk systems. Now that UI layer is increasingly being written in web technologies,” he says.

The upshot is that the “sexy” user-facing roles in finance increasingly use Javascript and HTML five. The less sexy roles maintaining the servers still require C#. However, recruiters say this is changing, particularly at U.S. banks, which are switching to Java and Linux server environments.

The laggards are the European banks. Credit Suisse, Barclays, SocGen and BNP Paribas are understood to remain wedded to C#.NET for both their front and back end applications. “European banks can’t afford to move away from their .NET systems,” says technology director at a Swiss firm. “They might want to, but you have huge existing systems and moving is just too expensive.”

For this reason, Baxter says you’ll always be able to find a C#.NET job with a bank, and that this job will usually pay well. In London, £550 to £750 a day is common for contract C# programmers working on “business critical systems” or developing user interfaces. Global macro hedge funds are also a repository of C# jobs: tech systems are less important in global macro and most funds have been slow to switch their systems across to angular technologies.

For the most part, however, recruiters say Javascript and HTML 5 are the future for front office finance roles. Moreover, with tech start-ups also recruiting for this talent, banks are being forced to pay-up.

So what do you do if you’ve built a career as a coder in C#? Baxter says the best option is to chase one of a new class of “hybrid” role requiring people with both C# and Javascript as banks make the transition. “There’s a lot of competition of these roles,” he says. “People want to upskill and stay employed.”

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

““

↧

Morning Coffee: The 27 year-olds getting 3 hedge fund offers a week, and how to become one

May 24, 2017, 3:56 pm

≫ Next: The perfect CV for a career in trading

≪ Previous: Do you really want to be a C# developer in a bank now?

Is it a while since someone called you to offer you a new job? Since a recruiter gave you a special gift? Since your employer gifted you tickets to a sold-out show? You’re in the wrong area of finance. If you were in a highly quantitative role, you’d be getting all this and more.

So suggests the Wall Street Journal in the latest instalment of its series on the resurgence of quants.

Nina Kuklisova, a 27 year-old quant associate working on risk systems at the Bank of Tokyo Mitsubishi in New York, tells the WSJ that she’s fighting off the recruiters. Between three and five of them call her every week, touting offering jobs at “other finance firms” and tech companies.

A recruiter tells the WSJ that he “love-bombs” quantitative candidates with golf lessons and “private dinners” with tech firm founders.

And it also reports that hedge fund Citadel is gifting its quantitative employees with tickets for Hamilton in Chicago and New York.

For a breed of finance employee widely vilified for causing the financial crisis not so long ago, quants have become inordinately popular. And as Kuklisova’s case shows, it’s not just banks who want to hire them. It’s also hedge funds. And it’s tech firms like Google and Facebook. Along with every other company with a need to analyse data.

“Google is trying to hoover up every data scientist in the world,” the chief executive of Man Group confides to the WSJ, adding that even Man can’t compete with Google in terms of pay. If you’re looking for the most sought-after spot in finance and tech, the data scientist/quant is it.

Separately, and more pertinently, how do you become one of these people every bank wants to hire? The traditional route has been to do a PhD, but a growing number of Masters courses prepare students for data science jobs too. Kuklisova studied Maths at Chicago and Columbia, followed by the comparatively new Master in Information and Data Science degree at Berkeley.

If you’re based in Europe, however, you might want to consider Imperial College. The Financial Times reports that the London University College started an MSc in business analytics three years ago and has already achieved some exciting things – including a visualization depicting a tendency to accumulate senior staff at the Royal Bank of Canada.

Meanwhile:

Magnetar, a hedge fund once known for its discretionary investment strategy, has “gone quant” and is now 20% comprised of technologists. (WSJ)

At Google: “A male Googler drank excessively at an offsite event and touched a few different female Googlers in a manner that made them uncomfortable, made inappropriate comments, and followed two women back to their hotel room and told them ‘I’m following you.'” (Bloomberg)

If you want to be a tech entrepreneur you must do your MBA at Stanford. At the typical business school, some 3% of recent MBAs start a business upon graduation. At Stanford, it’s about 16%. (Bloomberg)

The worst thing about interviewing at tech firms: “Imagine being brought into a room with a complete stranger, being handed a mysterious algorithm, then being told to implement and analyze it within 45 minutes while said stranger evaluates your ability to do it.” (Business Insider)

Blackrock’s begun benchmarking its benefits against tech companies. (BenefitsNews)

Bank of America’s been shaking up its U.S. high-touch equities trading business. (Bloomberg)

Rothschild’s new U.S. boss, Jimmy Neissa, keeps hiring. He just added three new senior M&A bankers in NY and one in LA. (Financial News)

Crispin Odey still thinks UK stocks will slump 80% after Brexit. Too many Britons have borrowed money they can’t pay back. (Bloomberg)

Your brain will eat itself when you’re chronically sleep deprived. Literally. (New Scientist)

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

↧

The perfect CV for a career in trading

May 25, 2017, 3:00 am

≫ Next: As Credit Suisse rebuilds in equities, its best traders eye Blackrock

≪ Previous: Morning Coffee: The 27 year-olds getting 3 hedge fund offers a week, and how to become one

If anyone needs a highly polished CV these days, it’s traders in investment banking. Juniors are taking over the trading floor, and even recent increases in revenues haven’t resulted in much more recruitment. The traditional jump into a hedge fund is becoming tougher as more look to train their own staff and increasing numbers fold altogether.

As an experienced trader, you’ll need to adapt your resume according to the products you’ve traded and the risk you’ve run. But as a junior in an investment bank, or trying to get into the industry, there are some simple rules to follow regardless of the desk you want to end up on.

1. The perfect trading CV must be no more than one-page in length

You’ll be up against thousands of applicants and if your CV makes it on to the desk of the trading team, they’ll want to be able to see the relevant points quickly.

“Traders have very limited time and even more limited attention spans,” says David Hesketh, COO of trading simulation platform TradingHub. “Keep it concise and relevant. Good punchy sentences are much better than long emotive paragraphs.”

2. The perfect trading CV will highlight brand-name universities and relevant coursework

If you’re up for a trading job, there’s a strong chance that you will have studied maths, economics or physics at university. You will have done this at either an Ivy League or Russell Group University and will demonstrate impeccable academics from school through to your eventual graduation. This is the reality of the competition.

“Many of the bank recruitment teams work off a list of the best (top 20) universities and business schools. This makes a big difference,” says Victoria McLean, managing director of CityCV. “But you also need to highlight any coursework that was capital markets, statistical, financial model related, in addition to anything that demonstrates your knowledge (and understanding) of the macro environment. You should also highlight any projects coursework or modules for which you scored a particularly high grade – especially if you led the project team.”

Hesketh says that you need to highlight education most relevant to the type of trading job you’re applying for – an FX spot trader should “emphasise anything relating to central bank policies and inflation” whereas, say, structured credit trading candidates need to make the most of their analytical skills. “Good candidates would have natural science or maths degrees and show a keen interest in programming languages,” he says.

“Try to portray that you are at least in the top 10% academically,” says Peter Harrison, an ex-Goldman Sachs trader who now runs Harrison Careers. This, unfortunately for the majority, means a first class (or at least 2:1) degree or a GPA of 3.7-4.0.

3. The perfect trading CV will demonstrate revenue-generating capabilities

Like any investment banking job, the quickest route into a trading job is to intern with the division you’ll eventually end up in. In fact, these days graduates securing markets jobs usually have at least two internships under their belt. But getting directly relevant experience isn’t the only thing to emphasise.

“Highlight any client experience and your ability to generate revenue – this could be in any sector,” says McLean. “If you have worked in any revenue-creating or client-expansion capacity then try to lead with the outcome and think carefully about targets you have surpassed, budgets you were set and volumes. Think achievements! What was the result and what role did you play in achieving this? What kind of volumes of calls or clients or products were you dealing with?”

The work experience section of your resume should not just be crammed with as much relevant experience as possible – you need to emphasise an interest and capacity for trading as well as evidence of leadership and teamworking experience. You could have taken part in a trading simulation game or competition that shows your prowess, or been part of an investment society where you can demonstrate your trading ideas.

4. The perfect trading CV will suggest some trading ideas

“Mention your three best trading ideas,” says Harrison. “For example ‘I would short Tesco – in two years its market value will half.’ or ‘I would go long oil with a $X target because demand will be rise to X million b/d by end 2017’. Or highlight a successful call – firms that you discovered were undervalued and recommended investing in based on long-term earnings growth, for example.”

5. The perfect trading CV will show an ability to handle pressure

You’re not shouting across a trading floor anymore, but the job is still loaded with pressure and requires quick-thinking and an ability to handle decisions that don’t go well. At a graduate level, the best way to demonstrate this is through extra-curricular activities.

“Mention hobbies that demonstrate the criteria the banks are seeking – for example the banks like sportsmen – they want to hire individuals that are competitive, aggressive, confident, disciplined and importantly believe in themselves,” says McLean.

6. The perfect trading CV will mention poker

Poker skills are a big plus, says Hesketh: “Games like poker also show traders that the candidate is good at estimating probabilities and multiple outcomes in a short space of time.”

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

Image: Getty Images

““

↧

As Credit Suisse rebuilds in equities, its best traders eye Blackrock

May 25, 2017, 5:46 am

≫ Next: Senior Goldman e-trader returns to the bank after eight years at J.P. Morgan

≪ Previous: The perfect CV for a career in trading

2017 is a year of change for Credit Suisse’s under-performing equities business. In Mike Stewart and Stuart McGuire (and now Michael Di lorio) the Swiss bank is bringing in three well-established, well-liked industry heavyweights to turn things around. But, as the cash equities business is given an injection of new leadership, Credit Suisse risks losing top traders in other areas to their former colleagues at BlackRock.

The most prominent among the latter is Tim O’Hara, the former head of Credit Suisse’s global markets business. O’Hara left Credit Suisse suddenly in September last year and Brian Chin was appointed in his place. Last month, O‘Hara joined BlackRock as head of global credit, with a mandate to boost the credit investing business at the world’s largest fund management firm. He has company. Also at BlackRock is Philip Vasan, the former head of Credit Suisse’s Americas private banking business and – more importantly – the architect of the Swiss bank’s prime brokerage business. Vasan joined Blackrock last July, as head of investments and solutions for the wealth advisory unit, with a mandate to look at ways of combining actively managed mutual funds and index tracking products.

Credit Suisse insiders say O’Hara and Vasan represent the latest link between the under-performing Swiss investment bank and the thriving global money manager. BlackRock bought Credit Suisse’s ETF business in 2013. Andy Stewart, a former head of liquid alternatives at Credit Suisse is co-head of BlackRock’s alternative investing business. But while Stewart was only at BlackRock for three years, Vasan and O’Hara were CS lifers: the two men spent a combined 50 years at the Swiss bank. If anyone knows where the best traders and salespeople are buried at CS, they do. And most Credit Suisse traders would be only too happy to shift to BlackRock at a moment’s notice.

“There’s a close association between Credit Suisse and BlackRock now,” says one senior CS equities banker, speaking off the record. “Anyone who can get a chance to move to BlackRock, will go,” says a headhunter, speaking on a similar basis.

Both O’Hara and Vasan are based in the U.S. So far, there’s little sign that they’re eyeing up people at their ex-employer. Robin Ferrett, a former equity derivatives structurer at Credit Suisse in London joined Blackrock’s quantitative finance business in San Francisco in October, but this looks like mere coincidence. Ultimately, if O’Hara hires from anywhere, it’s likely to be from Credit Suisse’s successful emerging markets or high yield businesses. If Vasan hires from anywhere, it’s likely to be from Credit Suisse’s equity derivatives business, although his focus on marketing to retail investors at BlackRock could preclude recruits with an institutional bias.

Credit Suisse’s cash equities traders won’t be joining Blackrock. Not only do they fall outside the scope of the two ex-CS lifers, but they’ve got a bad image in the market and are unlikely to be of interest. “Credit Suisse’s cash equities business in London is mostly awful,” says one equities headhunter. “It’s the electronic trading business, run by Chris Marsh, where the strength is,” he adds. Headhunters say Marsh’s business has been well-looked after, but Mike Stewart may still need to offer reassurances when he arrives next month: Ksenia Ozdoeva, a VP-level electronic equity sales trader at the bank is understood to have recently quit for Bank of America Merrill Lynch.

For ‘good’ CS equities insiders, the arrival of Stewart, McGuire and Di lorio, each of whom is widely held to be exceptionally good and exceptionally personable, represents an opportunity to undo years of neglect. Stuart is the big, transformational hire: he’s joining in June as global head of equities, based in New York. McGuire is expected to join in the third quarter as head of EMEA equities client execution strategy, based in London. Di Lorio is joining at the end of August, as head of EMEA equities, also based in London. Insiders say the Swiss bank is now aiming to be in the top five globally in equities. In the U.S. it’s ranked around sixth, but in Europe it’s fallen to eighth or even ninth.

“The strength in Credit Suisse’s equities numbers always came from electronic side and the rest of equities at CS has been under-invested in for years,” says one CS equities professional. “The worst time was in 2010 when Brady Dougan [the former CS CEO] decided to build out in fixed income. The equities floor was this low-ceiling dingy sort of place and Dougan created a big, high-ceilinged, fantastically decorated new fixed income trading floor and hired in hundreds of people – most of whom weren’t even the best in the market. Bit by bit, the fixed income people then took over.”

The balance of power at Credit Suisse won’t change with three big equities hires – the whole global markets business will still be run by Brian Chin, whose background is in securitization. All the more so as Chin is orchestrating the current rebuild before Stewart arrives. Even so, Stewart, McGuire and Di lorio might help tilt things back to equities – especially if some of Credit Suisse’s senior fixed income traders leave to work with O’Hara. This, quietly, is the hope.

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com

“”

↧

Senior Goldman e-trader returns to the bank after eight years at J.P. Morgan

May 25, 2017, 7:39 am

≫ Next: Why quants don’t (always) want to work for banks

≪ Previous: As Credit Suisse rebuilds in equities, its best traders eye Blackrock

Can you ever go back to Goldman Sachs after you’ve left the ‘firm’? Yes, actually.

The head of electronic trading for J.P. Morgan’s commodities business, who joined the bank after 20 years at Goldman Sachs, has just returned to his former employer.

Scott Weinstein has just re-joined Goldman as a managing director in operations engineering in its securities business after eight years in senior electronic trading and quant roles at J.P. Morgan.

Weinstein last role at J.P. Morgan was leading the team developing its commodities automated trading systems in commodities, but was previously head of quantitative research at the bank and technology for the commodities division. He also sat on J.P. Morgan’s Electronic Trading Management Committee, which was formed in 2013.

Weinstein’s latest role represents a return to the ‘firm’ he spent over 20 years at in various senior jobs, predominantly around commodities. He was co-head of U.S. power trading at Goldman between 2002 and 2005 before moving on to a role as a bank loan trading strategist until his departure in April 2009.

Weinstein is the second senior former Goldmanite to return this year. Johnny Vo, the former head of insurance research at Goldman Sachs who left in 2011 to reinvent himself as a financial institutions group investment banker, returned to the bank in February as a managing director in research.

Investment banks’ commodities divisions made just $800m in revenues during the first quarter of 2017 – a 29% drop on the same period in 2016. However, Goldman Sachs was ranked number one last year for commodities, according to figures from Coalition. J.P. Morgan, which dominated the league tables last year, was second.

Follow @paultclarke

Contact: pclarke@efinancialcareers.com

Image: Getty Images

““

↧

Why quants don’t (always) want to work for banks

May 25, 2017, 9:07 am

≫ Next: Why wealth management is moving away from “sink or swim” to target millennials

≪ Previous: Senior Goldman e-trader returns to the bank after eight years at J.P. Morgan

Chung (a pseudonym) is leaving Goldman Sachs’ strats team. After several years with the firm, he’s had enough. He’s going to try his luck with a hedge fund, or a fintech. Anything but a bank.

Chung was a sales strat (the Goldman Sachs term for quants) at Goldman: his role was to structure deals and analyze trades. If a client wanted to put a hedging strategy together using options, that was him. If a client wanted an analysis of the correlation between volume and relative value, that was him too. “I was basically a quantitative salesperson,” he said. “I used my quant skills to drive revenues, but it wasn’t easy. It only ever felt marginally useful to the franchise or clients and it didn’t feel like a sustainable career. The more senior you get, the harder it becomes to prove your value.”

Chung’s withdrawal from the Goldman strats team is quiet compared to the most voluble exit in recent history. That of Antonio Garcia-Martinez, a former pricing strat on the credit derivatives desk. Garcia-Marquez left Goldman in 2008 and wrote a vehemently anti-banking blog about the whole experience two years later. There, he argued that Goldman’s quants were a group of failed scientists working alongside “complete tools” in sales and “bat wielding gorillas” in trading. “We were basically the trader’s little bitches,” claimed Chung, adding that the embattled quants tried to maintain their sense of cerebral superiority by writing, “academic papers on the more theoretical aspects of their work,” – although their names were erased whenever they left to do something else.

The quants we spoke to said Garcia-Martinez’ experience applies to a lost past. Banks today are a lot less raucous: there are none of the food eating competitions he complains of. But there’s still a shortage of the rarefied academic pursuits that make quants feel special. Andrej Karpathy, a Stanford PhD and research scientist at OpenAI has just calculated the key institutions whose research papers have been accepted by ICML, a top machine learning conference coming up in Australia. The top twenty include Google, Microsoft and Facebook, as well as leading universities like Berkeley, Stanford and Princeton. There are no banks on Karpathy’s list. There’s not even a hedge fund. If the list is a proxy for institutions engaged in original research into artificial intelligence (which is what Karpathy suggests), finance looks pretty dire. This might by why David Ha, a former co-head of Japanese rates trading at Goldman, quit for a sought-after residency at Google Brain when he wanted to learn about machine learning.

Some quants aren’t even working at the algorithmic coal face. As a sales strat at GS, Chung says part of the problem was that he wasn’t actually writing code: “I might’ve stayed longer if I was.”

Garcia-Martinez didn’t respond to a request to comment for this article, but when he left Goldman he spent long hours coding. First, he created AdChemy, a bid management tool for online media exchanges. Next, he coded AdGrok, a search marketing tool. The latter was sold to Twitter and Garcia-Martinez went on to work for Facebook. Since 2015, he’s been writing a book about Silicon Valley; things have worked out very well.

For Chung, the future is less assured. He’s hopeful about hedge funds, although they’re more interested in data specialists that in quants who’ve worked in sales jobs. Maybe this is a bad time to leave Goldman anyway? Marty Chavez, the new Goldman CFO, is a former strat himself and the bank’s own jobs site is filled with strats roles as the firm pursues Chavez’ vision for a “data lake” overlaid by machine learning. If he were to stay at GS, which he won’t, Chung says he’d probably angle for a role coding the whole derivatives process. “That workflow is receiving a lot of attention – the entire, ‘client calls sales, asks for quote, sales calls trading desk, trading desk prices it, tells sales the offer, sales relays to client,’ thing is just begging to be automated.”

Follow @MadameButcher
Contact: sbutcher@efinancialcareers.com