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would see a lot more automation of
trade flow in that space.”
Regardless of the type of security
or the distance between traders
and portfolio managers, commu-
nication will still be a key element
of each particular strategy. Gibson
recalls her time with Bank of
Ireland’s Global Markets division –
her only stint on the sell-side – as
being particularly beneficial when
it comes to managing the role of
her portfolio managers at RLAM.
“When I returned to the buy-side
I very much looked at my portfolio
managers as my clients and valued
them as much as I did my external
clients when I was on the sell side”,
she says. “That was actually a sea
change, in terms of how they were
used to being treated, and it is very
much the culture that I try to instil
in our team; that your clients are
sitting behind you. Ensure there is
segregation and challenge where
needs be, but our end game is
the same, the best possible client
outcome.”
Bringing these types of experi-
ences to building up new trading
desks has helped to smooth out the
transition – Gibson says that the
process of building out the RLAM
desk was a far smoother process
than she or the business believed
it might be – and this was largely
down to the collaborative approach
between the equity, fixed income
traders and fund managers.
Gibson says such collaboration
and teamwork between the dealing
desk and portfolio managers,
reviewing trading strategies and re-
sults, ensuring there is an ongoing
dialogue between both sides and
being willing to learn from each
other has led to better end results,
for example in RLAM’s passive
operations where she says the team
has looked at execution strategies
aimed at reducing tracking errors.
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Gibson recognises that while much of the initial
foundations have now been successfully laid for
RLAM’s dealing desk, or are at least now at the
bedding-in stage, there is still much work to be done
both internally and at an industry level. The wider
ongoing attempts to address the diversity issue have
yielded mixed results so far, but Gibson illustrates her
own challenges with establishing greater diversity
in RLAM’s trading team, namely the “double-edged
sword” of striking a balance between attracting diver-
sity and turnover within a company.
It’s not an easily problem to solve: If people don’t
want to leave the firm then you must be doing
something right, but it becomes that much harder to
introduce greater diversity into a team or company,
particularly for mid-sized firms with more modest
resources than their larger competitors.
Despite this, Gibson believes she has had a success
in this space in her first 15 months within RLAM by
bringing in greater diversity in terms of gender, back-
ground and skill sets; the “stuff you can’t just put down
on paper” that are particularly important for trading
teams when it comes to managing relationships, both
internally and externally. It’s a formula that Gibson is
optimistic about for the future of the company.
In terms of continuing to attract generation of
diverse work force into the industry, Gibson says: “ I
want to drive home to the next generation that this is a
real value-added service that we are providing with a
potential for really positive social impact, whether that
be helping secure someone’s future financial security
or the growth of ESG and sustainable investment,
that’s how I think we can attract more diversity into
this business,” she explains. “I would like to help drive
this through the various different trade associations
and I would be very pleased if we can make some
significant in-roads into the space.”
“What I would like in future is for that to naturally
expand out between the portfolio managers as well,
because we have brought them together as well for the
first time,” she says. “We have one investment floor
with the dealing desk essentially in the middle and
the idea behind that was to not only bring the traders
together, but to bring the portfolio managers across
assets together. The bottom line is that in some cases
they are covering the same names, they are just doing
it from a different angle.”
New conditions
The desire to increase diversity levels on RLAM’s
trading desk is also informed by the increasing com-
plexity of market and trading conditions, meaning new
perspectives or strategies can make a difference in
execution outcomes. Whether executing via electronic
or voice channels, Gibson points out that the sheer
number of factors each trader must now be aware of
throughout the trade lifecycle has greatly increased.
For example, if a trader decides not to get a competi-
tive price on a trade, there will be implications down-
stream from a best execution evidencing perspective.
This, Gibson states, is just one of a host of consid-
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erations traders must be aware of
when it comes to the logistics of
trading from an operational point
of view, as well as how it fits into
the desk’s strategy.
“If you are trading a less liquid
US high-yield bond, for example,
is the bond traceable? If the bond
is traceable, do I really want to
do a scrap of 500K of them when
I know that is going to print in
30 minutes? And if I do that, am
I giving away sensitive market
information? Should I just wait to
get a block done and not let any in-
formation get out there? These are
all decisions a trader has to make
"I want to drive home to the
next generation that this is
a real value-added service
that we are providing
with a potential for really
positive social impact."
in a very short amount of time,”
she says.
While there are utilities to aid
traders in these situations – the
TRAX and TRACE data reposi-
tories in Europe and the US fixed
income markets, for example –
Gibson says that the real value is
having the subject matter expertise
on the desk, because “you can’t
expect one person to understand
the nuances of the entire spectrum
of the market to the same degree.”
The change in market conditions
has undoubtedly been acceler-
ated through the introduction of
Issue 60 // TheTradeNews.com // 45