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“The role of hands-on head of
trading has been diminishing
to the point where that role is
basically a quasi-compliance/
client sales role.”
FORMER SENIOR EQUITIES TRADER
encompassing.
“Regulation has actually shown
how important the head of trading
is now, as they can own a signif-
icant amount of responsibility
for oversight of execution, team
management, budgets, processes
and everything else that provides a
service to portfolio managers and
external clients,” says Paul Squires,
global head of trading and secu-
rities financing, AXA Investment
Managers. “It is completely natural
in that structure therefore that
the head of trading doesn’t do any
execution which generally requires
full concentration on markets.”
“I have a global team of 70 with
38 traders, executing over €750 bil-
lion notional of assets per year. The
appropriate execution platform is
increasingly about scale, operation-
al efficiency, technology, workflow
and strong governance, and that is
what the global head of trading is
responsible for. So should they be
responsible for trading? It really
depends on the size of your execu-
tion team and arrangements.”
This is not to say that the head
traders are totally absent from the
trading process.
For some asset managers that
break down their management
structure by regions and/or asset
classes, those head traders are
more involved in the physical exe-
cution process.
Those head traders interviewed
said that regulation has become a
duty that has become incorporat-
ed with their day-to-day trading
responsibilities. One head trader
argued that he has to trade in order
to understand the challenges his
team are facing.
“If you don’t get under the bonnet
you can’t fully appreciate the
challenges your team face,” one
head trader highlights. “That could
be technological, regulatory, flows,
coverage etc. you have to have
exposure. The trading landscape
changes so fast that if you are not
close to the detail of the business it
can get away from you,”
Another head trader comments:
“Head traders are, to some extent,
expected to be market structure
experts. However, time spent
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