Area of work
Fixed Income Trading, FX Interest Rates, FX Hybrids Trading

Studied
Masters in Mathematics, PhD in Theoretical Physics, Cambridge

Joined
July 2007

Working in
London

I had heard that BNP Paribas were specifically looking for a graduate to work in FX hybrid options who had a maths research background. I studied maths and physics to quite a high level, so wanted to work somewhere that I could use my mathematical knowledge, but also I've always been attracted to trading, so this opportunity seemed perfect for me.
It has really lived up to my expectations. There's a great combination of quite technical academic stuff, and then the specific pressure of getting the price right and beating the competition. The job is a combination of making client trades, whereby we trade specific structures with clients like banks or hedge funds, and then eliminating the resulting complex risk exposures as much as possible through hedging. I learn a lot from the people I work with; they've been in the business a long time and have developed a strong intuition for the way the products and the market behave.

While the bank does hire people straight from university to work in options trading, a more usual route in, for the sort of thing I do, is through research or structuring This particular field moves very quickly, people don't really have time to write things down and if they did it would go out of date so quickly that learning on the job is really the only way. It was very difficult for the first couple of months, a bit of a trial by fire, but it got much easier very quickly after that. It's immensely satisfying when things start making sense and you can see yourself contributing to the team.

I think the learning curve was particularly steep for me because I'm working in such a technical area of the bank. Many teams tend to price structures with only one underlying, whereas with the hybrids desk we're judging much more complex structures with often several underlyings, sometimes from different asset classes, so our models need to be more sophisticated. Within my area we tend to price more advanced structures than other banks, rather than trying to be ultra-competitive with large flow trades.

Traditionally many of our products revolved around the carry trade, where the client wants to take advantage of high interest rates in emerging markets such as Turkey and Brazil. However the challenge since the crisis has been to produce new, lower-risk strategies which can offer the client a good return but where the risk is more diversified. We are focussing more now on products which where the client can invest in baskets of currencies, as well as offering indices based on trading algorithms designed to be able to ride out turbulence in the market.
Working on the trading floor is different to how I imagined it would be. I thought it was going to be more stressful, but it hasn't worked out that way at all. You're constantly surrounded by people talking, making deals, or laughing and there's always streams of information coming in for you to analyse. We all get on together and there's lots of banter, obviously we work long hours and it can be intense at times, but I very much enjoy working on the trading floor.