Equity futures TCA has many similarities with other asset classes but there are also some key differences. Within equity futures, there is a centralised exchange, deep order books and excellent liquidity in most contracts. Unlike equities, there is no fragmentation across multiple venues and price transparency is less of an issue compared to some other asset classes or instruments. The futures market also engages in rolls which is uniquely measured from a TCA perspective. Pre-trade, market impact and peer models are not as common and can be less detailed compared to equities and this is an area which might benefit from more investment by vendors and brokers alike.

In terms of similarities, the same benchmarks are used to measure performance versus other asset classes, such as IS, IVWAP, TWAP and open/close snaps, with the latter focusing on the equity cash times. Algo wheels within futures are now in full flow with similar structures to their equity counterparts, albeit with potential contract size nuances.

How has the use of TCA in the asset class evolved over the years?

Equity futures TCA has developed meaningfully over the last 20 years, as has been seen with other asset classes. Historically, the focus was on explicit costs, such as exchange fees and commissions, rather than implicit cost measurement. As with other TCA improvements in recent years, that has evolved to include analysis which can provide actionable conclusions.

Market data has improved, and internal order data has become more accurate with the recording of several different order lifecycle timestamps. This led to increased use of TCA benchmarking.

The rise in electronic trading supported more granular order data availability. The current age of increased automation in all areas of the industry has led to more efficient trade handling, more accurate market data and subsequent performance analytics. Market data vendors have been able to remove un-addressable blocks, as well as delayed prints and rolls, to ensure performance is calculated on liquidity which is addressable. Given the infancy of pre-trade and market impact models for equity futures, it’s still lagging equities in terms of available analytics, however that has improved significantly.

What should be front of mind for firms when it comes to building effective, workable equity futures TCA capabilities?

With any analytics framework construction, it’s vital that the market and order data being used is accurate, leading to actionable insights and conclusions. TCA results depend on the quality of order instruction tagging, which can vary significantly. For example, classifying roll orders will improve the efficiency of separating them out and suitably measuring this flow. The ability to measure performance versus each point in the order lifecycle allows information to be provided to portfolio managers and traders on any glaring issues such as delay costs and order profiling. As a result, being able to access this data via an O/EMS allows for a more detailed analysis.

Engaging with the trading desk on the most appropriate methodology for equity futures TCA measurement is essential as they will have specific knowledge of the market structure, which can enhance the analytical framework and resulting conclusions. Splitting results into various categories can highlight underperforming areas to be investigated. When flow is significant, the use of TCA vendors is advantageous. This includes algo wheel orders where contextual market data is provided such as spreads, volatilities, liquidity, and market momentum. These can then be used to normalise slippages versus market conditions, to treat brokers/algos fairly.

How can these tools be improved to best measure trading performance?

Order tagging could benefit from being more consistent in accuracy and population, rather than applying blanket instructions to orders. Even if portfolio managers interact with the trading desk in the office or via messaging services, the resulting TCA performances can only be driven by the quality of tagging available in the datasets.

Pre-trade and market impact models for equity futures are available but can lag their equity counterparts. Investment into these areas by TCA vendors and brokers could therefore distinguish them amongst their peers.

Algo wheel customisations are already available in the market, however they often take a while to complete. This is an area where improvements would again push vendors significantly above competitors.

The post The evolving role of transaction cost analysis in equity futures trading appeared first on The TRADE.

Hinmon has a career history that spans nearly four decades, with the last 10 years spent at her current firm. Originally joining Glenmede in 2015 as an equity trader, she took on her role heading up the buy-side firm’s equities trading business in 2017.

Originally joining the industry as a runner on the trading floor of NYSE Chicago – formerly known as the Midwest Stock Exchange, her career was nothing short of a baptism of fire, igniting a passion for the markets that would lead to her current seat today.

“It was electrifying [seeing] the energy people had and the interest in the companies where stocks were trading. I ran to the bookstore within the first week of working on the exchange and I bought books on the market like ‘Inside the Fed’ and ‘a Barron’s guide to financial definitions’, and I just ate it all up,” she explains.

“S&P used to publish this tiny thing called a tear guide, and the paper was super thin, like airmail paper. I managed to get my hands on one and I took it home over the weekend and I memorised every stock ticker and which specialist traded it on the floor, and what post they were at so I could come armed and know exactly where to run a ticket to or from.

“The more interested I became, the more people became interested in me because I started asking questions.”

Not all traders will have the opportunity to witness the exhilaration of an open outcry trading floor during their career. In the past, the majority of trading has taken place in-person on a trading floor where traders in the flesh would buy and sell throughout the course of the day, and where runners – such as Hinmon – would run between them delivering tickets.

However, given the rising prowess of technology in trading, the way markets today operate has changed beyond recognition. Importantly, stresses Hinmon, so too has the way that traders feel markets and the methods that they use to anticipate movements. With greater electronification and fragmentation, it is sometimes harder to see the entire picture and this poses a new challenge for those starting out in the industry.

“It [activity on the trading floor] was like a freight train coming. You could feel the rumbling in the tracks. Especially on the New York floor, you can hear the footsteps,” she says.

“You could feel the vibration of people walking faster, and you can hear the momentum pick up. It was really fascinating to me because then your ears would perk up and you’re thinking ‘what do I need to pay attention to?’ ‘What’s happening right now?’ Now, you lose that continuity. It’s all machine-driven. There was a certain psychology that you could feel when people moved that markets lack now.”

Mentors

Hinmon stresses the importance of mentors when asked what has had the greatest impact on her career to date. It’s these relationships that have led her to her current seat, driven by her own desire to keeping asking questions and learning. It was when she was first working on the Midwest floor that she began to become interested in other areas of the markets.

“I went to the head of derivatives and said, ‘could you please explain to me why you’re trading this stock and what it is for?’ He ended up having me come over for an hour a week to sit with his team to learn what he did and why.

“Relevance is important in any business but even more so with the shifts that we see in ours and the constant changes with regulation, product, algorithms, exchanges and trading venues. You have to understand how they function, why they function and what’s the best route for you and your team to accomplish what your portfolio managers’ goals are.

“What may be important last week is less important this week. It may be on the front burner and then that flame goes out. It’s a game of chess.”

Cultivating and respecting relationships is a key mantra she suggests all new traders should follow. When asked what other tips and tricks she would recommend to those starting out in the trading industry, Hinmon highlights some of the most important lessons she’s learnt are remaining fluid, rolling with the punches and learning to admit when you’re wrong.

“Young traders have to recognise that the market is bigger than you are. You have to be willing to admit when you’re wrong. We’ve lived through a lot of different crises. The flash crash, the great financial crisis, Brexit, Russia, and looking back one thing you realise is just as markets don’t go up forever, they don’t go down forever,” she explains.

“If there’s been one thing I’ve learnt, it is that markets recover. They are living, breathing creatures. They have peaks and valleys. Don’t get too rattled when we have drawdowns in the market. Own up to your mistakes and learn from them. I had some pretty big errors back in the day. Whether it was a matter of trying to be too quick on something or flat out doing something wrong, own up to it and learn from it. People respect you more when you do that.”

US fragmentation

Hinmon, who sits on both the SIP and CAT (Consolidated Audit Trail) advisory boards among others, took home the Buy-side Market Structure Expert of the Year Award at Leaders in Trading New York 2024 after multiple industry nominations by peers and clients. The Philadelphia-based director of equity trading confirms she is increasingly keeping tabs on market fragmentation in the US. This, she explains, is one of the market structure themes having the greatest impact on the US equities landscape today.

Fragmentation is no new phenomena in Europe which has three times the number of exchanges as the US, 10 times the number of listing venues and 20 times as many post-trade providers and is an issue that comes up time and time again in the ongoing debate around the health of the liquidity landscape in the region.

Read more – The TRADE announces Leaders in Trading New York 2024 award winners

However, as noted by Hinmon and other market structure specialists, thanks to the launch of new national exchanges, the proliferation of private rooms within venues and the growth of the single dealer, bilateral and off-exchange segments, the US market has become fragmented to the point that many market structure experts are keeping a watchful eye to see how it further develops.

Private rooms have taken off in the US in the last year. Currently the concept – whereby a venue offers a select number of participants the opportunity to create a closed pool where they can interact with one another – is not permitted under EU regulation. However, in the US, as the number of venues increases, so too does the opportunity to fragment things further through more private rooms.

“What will the consequences be of the launch of the four or five new national exchanges?” asks Hinmon. “We already have 16. What does it look like if we have 21? That’s a big deal. It’s something that hasn’t been corrected in years.”

In making her point, the director of equity trading quotes several market structure sell-side partners that have all published data in recent months unpacking the ongoing theme of fragmentation, and what is and is not addressable for US traders.

Among the names is Jenny Hadiaris at Citi. According to Hadiaris, just over 25% of total market volume in the US in 2024 was addressable single-stock liquidity for institutional investors if ETF, sub $5 stock, market making and some wholesale retail activity is removed from the equation.

“It needs to be corrected. I don’t know what the solution is. If I could come up with the solution, I’d probably be able to retire tomorrow,” says Hinmon.

The increased fragmentation is also causing trading flow to become increasingly siloed to a certain number of asset managers dependant on where certain relationships lie, and this is contributing to changes in the buy-side competitive landscape.

“At some point in time, we’re going to be left with maybe eight or nine asset managers in the country. Is that really what we want? The market is becoming increasingly fragmented through bilateral trading agreements the proliferation of private rooms and single dealer platforms. If a select few are getting access to liquidity that others are not, how can we really say there is price discovery in our markets?”

The issue, Hinmon highlights, is the lack of transparency in the US as new venues and forms of trading continuously expand the competitive landscape. If volumes are becoming increasingly siloed into less transparent corners of the market that often do not print on the SIP, traders are faced with a greater challenge when looking to be executed in the market.

Data released by Jefferies’ Anna Kurzrok in a market note to clients found that in November last year, off-exchange volume exceeded 50% on 12 out of the 20 trading days, and on almost all of the trading days in December.

Segmented markets mean there is often less liquidity than an institutional trader might think, posing a challenge for those trying to navigate the execution of their orders. When exploring the growing off-exchange and bilateral segments, Hinmon highlights that this trend is not limited to smaller retail flow.

Quoting data released by Nasdaq’s Phil Mackintosh, she explains that looking at all stocks in the Russell 3000 Index, very few now have off-exchange share below 30%. In fact, the majority are now seeing off-exchange trading range between 40%-50% regardless of stock price or market cap.

When asked what the institutional buy-side can do to navigate this increasingly complex and shrouded landscape, Hinmon confirms that her team rely heavily on their transaction cost analysis (TCA) both internally and externally.

The situation is likely only set to be exacerbated by recent developments in the US that will see equities move to a 24 hour, five day a week model. There are several platform providers such as OTC Markets and Blue Ocean Technologies offering after hours US trading but in recent months the US market has also seen moves from central venues such as NYSE, Cboe, and Nasdaq, all looking to expand some or all of their equities books onto an extended trading hours model.

While the moves have glaring positives such as increased flexibility on trading and greater exposure to other regions around the world, an extended trading period for equities also poses some questions around transparency, operations and retail. Questions that those sitting in Hinmon’s seat must now begin to assess as the markets evolve further.

“What’s that [24/5 equities trading] going to look like?” asks Hinmon. “I can’t imagine institutions are going to be playing that. What’s the advantages for retail playing that? Is it going to cause additional retail fragmentation. Is retail participation going to be elevated?”

Other market structure developments Hinmon is keeping tabs on include the potential for the new administration to do away with the order protection rule (OPR), the expansion of institutional cryptocurrency trading, and whether the US Securities and Exchange Commission (SEC) is going to approve exemptive relief for ETF mutual fund classes.

While there are many potential plates spinning, Hinmon explains that she and many like her are for the time being waiting for the dust to settle following the election in November and subsequent change in administration in the US that took place at the start of this year.

Hinmon, like many in her trade, has learnt that success in this industry follows adaptability. While market structure and regulatory change in the US is currently somewhat dormant, it’s more than likely that with the change of administration witnessed at the start of this year, there is scope for a wide breadth of changes to be made that will echo through North America and into the markets globally. For those less clued up than Hinmon, it’ll likely be a bumpy ride.

The post Building success in a fragmented US appeared first on The TRADE.

Launched in March, the new service is designed to offer automatic price improvement over Xetra reference market prices.

Retail orders are integrated with institutional ones within the Xetra order book, however, central to the new offering launched in March is are retail-dedicated market makers designed to interact specifically with retail orders, with the aim of provides providing price improvement over the prevailing Xetra best bid and offer (BBO) prices when possible.

If this cannot be achieved, then orders are executed at least at the current Xetra price.

“Given the recent surge of retail investor activity in Germany and other European countries, our new retail execution service addresses the growing demand for efficient capital market access at the right time,” a Deutsche Börse spokesperson told The TRADE.

“This service represents an important milestone in our ongoing efforts to deliver first-class execution services specifically tailored to the needs of retail clients. It will also serve as a launching pad for further innovation in the future.”

Transaction fees for retail executions have been reduced by Xetra, subject to the investor’s bank or broker participating in the service. The service applies to all Xetra trading in equities, ETFs and ETPs.

It is supplemented by a free real-time Level 2 market data offering for ETFs and ETPs, launched in April. Registered private investors have access to Xetra ETF real-time push price data. The new retail data offering also includes real-time order book depth data of all ETFs and ETPs traded on Xetra.

The market data offering is also available to institutions for integration into their services, a spokesperson for Deutsche Börse confirmed.

The new ETF retail trading offering builds on the equities service launched by Xetra last year.

“With our new execution service, we aim to reduce both implicit and explicit execution costs for private investors, ensuring best execution in equities – including German, European and a broad range of foreign stocks – as well as ETFs and ETPs,” a spokesperson for the exchange said.

The post Xetra expands new retail trading offering with ETFs service appeared first on The TRADE.

Darragh Mullin, Blair Nicol

The appointments have been made as the firm seeks to expand the reach of its global foreign exchange desk.

Both will report to Nigell Todd, global head of FX, The TRADE understands. 

Mullin most recently worked as an FX trader at BASF, based in Dublin and prior to this served as a senior associate – ETF capital markets at JP Morgan Asset Management in London. 

His previous experience also includes a stint in an ETF pricing and trading role at Susquehanna International Group.

Read more: Fireside Friday with… Fidelity International’s Tim Miller

Nicol joins from Fideuram Asset Management where he served as a trader for three and a half years, based in Dublin.

Previous roles include stints as an execution trader at Airain and as an analyst for Jefferies. 

Fidelity was the inaugural winner of The TRADE’s Foreign Exchange Trading Desk of the Year award at Leaders in Trading 2024, presented at The Savoy hotel in London.

Speaking in a social media announcement following the win, Todd enthused: “We were incredibly delighted to have been shortlisted and this win means everything! Our success is on the back of many who continue to support us internally and externally with our banks, custodians and platform partners who work with us on providing solutions.

“[…] This win fuels our motivation to continue making a positive impact and delivering exceptional results for our clients.”

The post Fidelity International appoints two traders onto FX desk appeared first on The TRADE.

While at LSEG he was also a member of the executive committee.

Singh boasts three decades of experience leading global businesses in data and analytics, capital markets, post-trade services, payments, and technology.  

His previous roles include stints as global head of securities services and head of global transaction bank, EMEA, at Deutsche Bank, head of custody and clearing, EMEA at Citi, and global head of sales at HSBC Securities Services. 

London-based Singh has also previously served in senior position at Mastercard and Euroclear.

Read more: Fireside Friday with… LSEG’s group head of analytics, Emily Prince

In his role at LSEG, Singh led LSEG’s global data and analytics businesses which included the Group’s flagship Workspace product – financial and real-time data and news for the financial community, as well as spearheading the development of new offerings through LSEG’s Microsoft partnership.

An LSEG spokesperson confirmed the move and told The TRADE: “LSEG’s data and analytics business continues to deliver strong momentum and, with the progress we have made, is very well positioned to innovate, drive change and grow. 

“Our leading capabilities in data, analytics, insights and news, together with our flagship Workspace product provide a platform for continued expansion.”

The post LSEG’s data and analytics head departs after 18 months appeared first on The TRADE.

Matt Barrett

Speaking to The TRADE, Matt Barrett, chief executive and co-founder of Adaptive, explains: “From simplifying client onboarding to seamlessly integrating order flow when building custom front-office trading systems, the value this will provide to clients can’t be overstated. 

“[…] At Adaptive, we have a long-standing reputation for providing customers with best-in-class trading systems. With this new partnership, we will be able to go beyond the capabilities of standard FIX engines, creating even more comprehensive, agile and robust solutions for capital markets firms.” 

The integration is being made possible through Adaptive’s open-source messaging and clustering technology, Aeron. 

Paul Weiss, chief technology officer, Adaptive, adds: ”Aeron technology is specifically designed to help even the most complex of capital markets firms build fault-tolerant, high-performance trading technology successfully. As Rapid Addition’s platform is built on Aeron technology, we share the same technological building blocks – there are therefore huge synergies between our businesses. 

“Our Aeron expertise and Rapid Addition’s FIX expertise gives clients a greater depth of knowledge and new capabilities that will make a meaningful difference to their businesses.”  

Rapid Addition’s scalable FIX platform can handle thousands of connections and provides support for all versions of the the Financial Information Exchange (FIX) protocol – as well as “custom rules of engagement”.

Owned by the FIX Trading Community, the protocol was designed in an attempt to simplify workflows and reduce error by creating an industry standard adopted by all. Through their new partnership, Adaptive will “build bespoke front-office trading systems with complex, global, high-volume connectivity requirements beyond the capabilities of standard FIX engines, creating more comprehensive, agile and robust solutions for capital markets clients”.

Read more: Fireside Friday with… FIX Trading Community’s Jim Kaye

This collaboration claims to enable firms to simplify counterparty FIX onboarding and order routing workflow and comes as the market continues to see increasing necessity for clients to stay on top of regulatory change and margin pressures, emphasising the need to leverage solutions to up their own responsiveness.

Mike Powell, chief executive of Rapid Addition tells The TRADE: “We view this partnership as a genuinely strategic initiative. One of the key market trends we are seeing is a widespread review of legacy trading platforms with a desire by firms to shift to a more agile, orchestrated approach, combining the best of third-party tech with in-house applications.

“Our collaboration with Adaptive aims to seamlessly bring together our respective strengths in supporting trading workflow, while enabling easy integration to our customers’ broader trading system and technology choices.”

The post Rapid Addition and Adaptive unveil partnership to enhance FIX capabilities appeared first on The TRADE.

Brian Rubin, Dwayne Middleton, Paul Cable

T. Rowe’s fixed income operations spread across three continents, with dedicated teams based in the US, the UK, and Hong Kong. Dwayne Middleton, global head of fixed income trading, is the one responsible for overseeing these teams, developing talent, defining strategic direction, building strong relationships, and integrating increasingly advanced technology.

Speaking to The TRADE about his career in asset management thus far and how his experiences shape the way he leads the team, Middleton shares that his path so far has not been conventional – and that that, of course, is a good thing.

“My journey to the trading desk has been anything but traditional, and I’m incredibly proud of that. As a person of colour coming into asset management, I didn’t take the most conventional path. Still, my parents – both educators – instilled the value of integrity, curiosity, and hard work from an early age. These lessons have shaped my career and how I approach every decision on the desk.”

“[…] Relationships have been central to my journey. Connecting with colleagues, peers, mentors, and partners across the market has taught me as much as any classroom and reinforced that success in trading isn’t just about numbers – it’s about engaging with people. Non-traditional paths often lead to the most rewarding destinations, and I appreciate the chance to contribute to an evolving and more inclusive industry.”

In terms of what his guiding principle is while performing his role, Middleton highlights integrity above all, further adding: “my approach is a willingness to listen, learn, and deliver results”.

When it comes to who heads up the various desks, Paul Cable, head of international fixed income trading is responsible for the London and Hong Kong trading teams, while Brian Rubin, VP, heads up the US fixed income trading offering.

Cable’s team trades the length and breadth of the international fixed income and FX markets, comprised of a team of nine traders (six in London and three in Hong Kong), while Rubin oversees a desk of 14 fixed income traders from the T. Rowe Price Baltimore base – set to unveil their new HQ at the location in late Q1 2025, The TRADE understands.

Sharing expertise, local success on a global scale

Speaking to The TRADE, the team emphasises that individual responsibility is the key to team success, a core perspective within the T. Rowe Price school of thought, which extends across both internal teams and regions.

“Our international reach allows us to identify opportunities, manage risk, and serve clients across time zones while maintaining deep local market expertise,” affirms Middleton, adding that the firm’s approach is as “an integrated global fixed income trading platform where market insights flow seamlessly across markets”.

“The team is our biggest strength,” agrees Cable, “It’s a strong group of exceptional traders with deep individual subject matter expertise enhanced with a breadth of knowledge across markets that provides insight to the investment process and contributes to great client outcomes.

“I’m now into my twenty-sixth year at T. Rowe Price, the last 16 of which have been as part of our global trading team, and it’s been a real privilege to watch and be part of the growth of our international presence.”

What is notable when it comes to how the team appears to operate day to day is how the role of traders is not solely limited to execution. It also extends further afield to understanding investment theses through working closely with investment team members, allowing them to provide market colour and effectively identify relative value opportunities, explains Middleton.

“Portfolio management and research partnerships drive our competitive advantage […] This integration between trading and the investment platform creates a powerful feedback loop that enhances transaction quality and client investment outcomes.

“This integrated approach proves especially valuable during market stress when our ability to source liquidity and insight across markets enhances the investment process.”

Rubin concurs, adding that the success behind T. Rowe Price can be put down to this approach, with the group of talented traders encouraged to be more than just order executers.

“Our traders effectively partner with analysts and portfolio managers to identify opportunities while analysing both upside and downside to benefit our clients. Traders are involved in every step of the decision-making process which gives them the opportunity to add value.”

Speaking to The TRADE from Baltimore about the dynamic of the fixed income desk, Michael Daley, VP, fixed income credit trader agrees that the lifeblood of T. Rowe Price truly is its collaborative culture.

“The trading desk is fully ingrained in the investment process and is expected to generate ideas and bring liquidity to our entire platform.  Traders work closely and collaborate on a daily basis with portfolio managers, fundamental analysts, and quantitative analysts.

“This collaboration is inclusive and one in which all parties in the investment process respectfully and constructively challenge one another.  This collaborative nature helps ensure best ideas from investments and trading are incorporated in our strategies. All involved parties are key contributors which helps foster continuous idea generation.”

This idea of a level playing field from all those involved is a key contributing factor to T. Rowe Price’s success, the team enthuses, wherein communication flows not just vertically, but also horizontally.

Communication isn’t just top down

When it comes to the desks’ dynamic, it is clear that openness rules, and the willingness to learn and embrace the new is encouraged and fostered.

Communication across the desk, Middleton explains, flows freely across all team levels, with this approach enabling efficient opportunity capture.

“A strong trading team thrives on diversity of thought, seamless communication, and a shared commitment to the firm’s goals. Trust and mutual respect within the team – and with external partners – are critical for success.”

He adds: “A focus on innovation and a proactive approach to embracing new tools and strategies set the best teams apart in an increasingly competitive market.”

When it comes to the most important lessons, adaptability is flagged as key when looking to drive success in trading. Given that markets are dynamic by nature, the continued increase of black swan events, and the rate of technological evolution showing no signs of slowing down, responding quickly and effectively to these changing conditions as a unit is more critical than ever, the team tells The TRADE.

“The desk is a dynamic team who is working towards the best outcome for our clients. We promote a team environment where everyone has a voice and can make an impact,” enthuses Rubin.

“Listening is key to success. Sometimes taking that step back and receiving the message helps in not making quick or wrong decisions. Listening is the key to communication and collaboration as if others feel that you are not just hearing but digesting their message it makes things go smoother.”

In an industry where work/life balance and work satisfaction are increasingly being brought to the fore, this collaborative, cross-team approach is not only effective, but also, the team notes, enjoyable.

As Cable explains: “the culture and dynamic on the team is collaborative and supportive which creates an enjoyable environment to operate in”.

Future life on the desk: Traders as architects?

This approach of well-rounded traders who thrive on co-operation across teams  is set to be increasingly important  for T. Rowe Price. As the industry continues to be shaped by ever more innovative technology, so too are the role of traders.

As Rubin points out, the most effective approach is one in which the desk is able to partner with other segments of the T. Rowe team (such as portfolio managers), but he also sees this evolving even further in the future.

“The trader’s role will look very different with fewer manual processes and balance the use of advanced technology to help make decisions. Traders will have more data at their fingertips and will collaborate with not only analysts and portfolio managers but other teams including quantitative analysts and technology to access liquidity efficiently while markets continue to get more complex.”

Middleton concurs, going on to explain that collaboration will remain key, and also that traders will become more interconnected across not just teams but also regions.

He adds: “The trader’s role will resemble that of an architect as the next gen traders design and deploy strategies that blend human insight with advanced technology. Traders will increasingly act as data, liquidity, and market intelligence integrators, leveraging technology to construct execution frameworks tailored to dynamic client needs and market conditions. 

This shift of course comes hand in hand with technology, which Middleton highlights will enable a more immersive and real-time interaction, as well as allowing traders to focus on high-impact, strategic decisions and relationship-building.

When it comes to what this could look like empirically, he explains: “The trading workspace will transform into an interoperable information centre, where advanced visualisation tools and integrated platforms provide a 360-degree view of markets, liquidity, and risk. Desktops will become interconnected workspaces that seamlessly merge data feeds, analytics, and trading protocols.

“[…] An environment where technology amplifies the trader’s expertise, enabling individuals to operate with precision, creativity, and efficiency in an increasingly complex and globalised market.”

Speaking to the future of traders’ roles, Daley also emphasises the importance of relationships, which “will continue to serve as the key driver to market liquidity”, as well as highlighting that “as market structure continues to evolve, strong partnerships and thought transparency with dealers, vendors, and third party trading platforms will be paramount”.

“Relationships are the lifeblood of our business [it’s important to] not to be scared of market evolution, rather, embrace it. Look for ways to serve as a thought leader, value the insight of peers across the industry, and collaborate with both the buy- and sell-side to help push market innovation forward.”

Pressure makes diamonds

No two trading set-ups are the same, and when it comes to what makes T. Rowe Price’s fixed income traders tick, it is clear that co-operation and collaboration built on a strong bedrock of solid relationships, alongside the freedom to speak up and be creative are the main pillars behind the desk’s success.

“The team dynamic on our desk is highly collaborative, fast-paced, and built on mutual respect and trust. Each member brings unique skills and perspectives, cultivating innovative problem-solving and knowledge-based decision-making,” asserts Middleton.

“[…] The best traders combine deep market knowledge with strong analytical and interpersonal skills. They stay calm under pressure, remain humble, think critically, and execute with precision. Curiosity and a willingness to learn are essential as the landscape constantly evolves.”

It is with this strong foundation of co-operation between the T. Rowe Price team that the desk is able to use pressure to create top grade diamonds.

As Middleton affirms: “We thrive under pressure by staying focused and supporting one another while maintaining an environment of constructive feedback. We value individual accountability and team success, creating an environment where everyone can perform at their best while contributing to a greater whole.”

The post The T. Rowe Price fixed income desk on making an impact appeared first on The TRADE.

I was at Bear Stearns through the JP Morgan integration, and I would have been a Bear Stearns lifer had it not been for the intriguing opportunity to join Credit Suisse as a multi-asset and special situations spokesperson across all products. I made the jump to Credit Suisse and we developed this product nucleus within the equities division to facilitate content distribution and market making across all asset classes, including volatility strategies tailored for hedge fund clients.

Mike Simanovsky, the founder and CIO at Conversant, served as a partner at Senator Investment Group, there for nine years before launching Conversant in early 2020. During Conversant’s formative stages, Mike and I had befriended one another while I was on the sell-side. He envisioned Conversant as a platform to capitalise on real estate opportunities across the liquidity spectrum in both public and private and up and down the capital structure including equity and credit. When Mike called me about the opportunity to join Conversant, he emphasised the firm’s long-term, buy-and-hold strategy, akin to private equity. He didn’t need a day-to-day trader, he sought someone who spoke his language, had a long-term mindset, and could be conversant across markets. Mike was building an investment team and process focused on idea generation and creative structuring. I was drawn to the flexibility of this mandate.

What does your role involve?

I oversee the capital markets function and I assist in origination. Our public positions and investments have originated through a rigorous capital markets process. We spend a lot of time thinking about capital markets activity and how that could create potential opportunities on both the public and private investment side. 

There’s been a reopening in capital markets. It seems like a lot of issuers are trying to finance or fund next year’s capital needs and are getting ahead of it opportunistically. It’s been busy. On the equity capital markets (ECM) side, volumes are up significantly, close to double from last year, and even more so since 2022. I maintain constant dialogue with ECM and leveraged finance desks to identify the next potential investment opportunities. 

Taking a step back, our investment team consists of seven professionals, including the chief investment officer, three principals, two analysts and myself. We structure the team by real estate sub-sector. We of course cover the traditional real estate sub-sectors, but also emphasise non-traditional real estate and real estate-adjacent sub-sectors, including digital infrastructure, asset managers, car washes, and student housing, as an example subset. Each investment professional is responsible for covering their respective sub-sectors across public and private markets. We have a lot of go-getters on the investment team which I love. We all sit together in our headquarters, and we emphasise collaboration. There’s a very healthy dialogue at all times at both the portfolio-level and the position-level.

Despite being a smaller organisation, we have a strong institutionalised process. My day may range from trading liquid US stocks to more illiquid European names. We do a lot of bespoke or more idiosyncratic trading when it comes to distressed bonds or structured credit. 

We take a capital structure agnostic approach to our investment mandate and spend a lot of time thinking about relative value within the capital structure. We look for the opportunity that best achieves opportunistic returns on the best risk-adjusted basis, be it in equities, corporate bonds, distressed bonds, bank debt, or convertibles. We do some listed options more on the index side as hedging instruments. We are nimble and agile. 

What is the core skillset for someone in your role?

It’s important to have awareness on cross-market currents and on what’s happening globally across every trading jurisdiction. But even more so locally, whether it is US and Europe and just having a good handle on whether it might be rates or a factor or certain style that is percolating in the market. It’s about being balanced and having a good pulse and awareness of what’s going on across markets. I’m wired to be idea-generative and an idea-oriented person. 

Why did you choose Conversant?

The beauty of what we’re doing at Conversant lies in our ability to be flexible and opportunistic. We pride ourselves on being a flexible capital provider to real estate and real estate-related companies and platforms, investing throughout the capital cycle. We’re opportunistic in nature, looking for situations that meet or exceed our return thresholds on a risk-adjusted basis. We have a synergistic approach to both public and private investments, leveraging insights from the private markets to inform our strategies in the public markets, and vice-versa.  

What are you seeing in terms of market impact following the election?

There’s a lot of copycat behaviour. People have a playbook from the 2016 election, a script for US exceptionalism, deregulation and reflation. I think we’ve come a little too far, too fast. The markets have cheered the new administration coming in and what that means for deregulation, consolidation, tax and tariff policy, but there are still several unknowns. With regards to deregulation, for us, it’s about what it might mean for further loosening in commercial real estate or real estate credit and how that might convert into further capital markets activity and lending. The setup for 2025 is harder. The S&P is at around 22 times earnings. The last election, it was 16 times earnings. The bar to beat is a lot higher. If you’re a company in the US, it’s time to grow or go home and there will be very little margin for error.

We’re not macro timers. We’re not handicapping election outcomes, but a lot of what we do is rate sensitive. We own a lot of rate proxies with duration, so one thing we think about is mitigating those sensitivities. You’re entering a fed cutting cycle, yet rates are 65bps wider since the first cut in September. What does that tell you? Growth is good and clearly there are renewed inflationary/fiscal worries given the new administration. There might be a tipping point soon in the 10-year, let’s say around 4.5%, and we are mindful how quickly sentiment could shift in real estate and more so homebuilders. If we had 5% rates again that might quickly become a market problem.

This might speak to overall more deregulation or banks willingness to lend or make markets, but it does seem like there’s more desire to take risk from the bigger banks who have the balance sheets. In terms of market making or liquidity facilitation, a lot of the bigger firms have the appetite to do it. From my vantage point, you are already seeing more risk bids at tighter discounts in block form. 

What workflows are ripe for more automation?

There’s a lot of analytics already being offered. You’re seeing it from vendors in Bloomberg around portfolio construction and analytics to augment or improve processes specifically to correlation and factor tilts. One of the things that you might see is for deals specifically in the US and Europe, you’ll ultimately see better deal indication streamlining, meaning direct order entry of orders for ECM deals. That’s one thing that I’m focused on. 

Everyone’s obsessed with AI replacing human capital. It’s certainly a unique resource, but in our view, you are always going to need someone on the other end of the phone. Our business is relationship-based and complex whether it is market making or investment banking and origination deal making. Human capital will not be replaced. Will it be improved through AI productivity and enhancement efficiency? I believe so.

What advice would you give to yourself or someone starting out in your sphere now?

Be long-term minded and patient. Markets are efficient and if you’re good at what you do and you prove it, there’s natural progression in your seat whether that’s ultimately running a desk or an entire division at a large investment bank. A lot of people look for instant gratification, but my advice is to play the long game. Act instinctively yet take calculated risks. Competency and ability always prevail. 

I was an analyst at the time of the global financial crisis. I was 28 years old and only seven years out of college. It was a frightening time given the unknowns. However, everyone at Bear Stearns went on to do bigger things. I take a lot of comfort in knowing that the best athletes ended up in great seats at some great firms.

The post Trader of the Year Hedge Fund: Conversant Capital’s David Alfred appeared first on The TRADE.

Daniel Shepherd

BTON joins the dots between TCA and order routing and its AI-powered broker recommendation system transforms the traditional broker selection process by leveraging advanced neural network algorithms to predict slippage and dynamically match orders to the optimal broker.

BTON’s users gain immediate access to cutting-edge technology and a continuously improving system powered by aggregated, anonymised insights from across their client base.

Speaking to The TRADE about the firm’s imminent North American launch, Daniel Shepherd, chief executive of BTON, said: “The industry has collectively come to the conclusion that AI is going to revolutionise workflows and optimise outcomes.

“When it comes to talking about the big AI changes set to take place, no one wants to be in a position down the line where they have to say ‘I stood on the side lines and waited to see what would happen,’ they want to be part of it. In the US there’s a real level of optimism in this space, so we’re very excited to be part of this and the opportunities arising there.” 

Read more: OptimX and BTON partner on AI analytics for block liquidity 

As well as its US launch, next month BTON – in collaboration with AI-focused firms MindfulMarkets.AI, Imandra, SIGMA Financial AI, and Gamma Zulu – is launching AI-focused capital markets forum ‘Innovation, Collaboration & Future of AI in Trading’ on 6 February. 

Important market developments, including the UK’s recently published AI action plan, has expedited the need to assess how future adoption of the technology could look and the roundtable is set to examine just this. 

“It will be a dynamic, interactive discussion on the future of AI in trading, exploring the immediate opportunities and the strategic pathways needed to integrate into trading workflows. Most importantly, focusing on the essential need for collaboration among traders, fintech innovators, vendors and liquidity providers globally to reap the benefits of using AI,” explains Paul Brennan, chief strategy officer at Imandra.

This event has come off the back of conversations with the UK government department for business and trade, The TRADE understands. 

It is set to gather twenty industry experts from across the buy- and sell-side, exchanges, and fintech firms for the discussion – held at the British Consulate Residence in New York.

AI is not a niche sport. It’s about mass participation, bringing together collaborative ideas,” Andrew Simpson, chief executive of SIGMA Financial AI, tells The TRADE.

“It’s about organising ourselves so we can compete with firms who already have economies of scale. Partnerships and collaboration, especially in light of more of us opening up into new markets, is more important than ever. We wholeheartedly support this approach.”

The post BTON to launch in the US appeared first on The TRADE.

He is set to begin his new role on 20 January and will be charged with ensuring user needs are fully represented in the CT.

Specifically, he will lead discussions within the ISG on functionalities, fee and licensing models and other tender process requirements. 

Sassan Danesh, chief executive of Etrading Software, said: “We are delighted to have Stephane on-board and leading our stakeholder engagement activities. His leadership will be instrumental in the design of a high-quality tape.” 

Malrait was most recently managing director and global head of market structure and innovation for financial markets at ING Bank, overseeing the financial market innovation strategies within the firm. 

Before joining ING in 2015, he spent eight years at Société Générale, most recently working as global head of FIC eCommerce.

He also previously worked at JP Morgan Chase for ten years, serving in different roles in global FX eCommerce business management and cross-asset eCommerce technology, based in London and New York.

In December 2023, Etrading Software confirmed plans to bid to become the consolidated tape provider (CTP) for both the UK and EU. A move which followed the announcement that the Bloomberg, MarketAxess and Tradeweb JV was off the table. 

Speaking to his appointment, Malrait, said: “The consolidated tape is going to be a major market structure change in the UK and Europe and will impact all market participants. It is important that the voice of the user community is represented to advice and give feedback to CT providers.”

The FCA is set to appoint a bond CTP early this year, with the EU planning for the end of the year.

Read more: ESMA launches first stage of bond CTP selection process

Malrait was nominated by The TRADE for the coveted Industry Person of the Year award at the 2024 Leaders in Trading event in London. 

The recognition is designed to celebrate those individuals who have made a significant impact on their own organisation and, equally, the industry externally, with a commitment to bettering and future proofing the markets for years to come.

The post ING Bank’s Malrait joins Etrading Software appeared first on The TRADE.