Buy-side trading desks can seem a bit mysterious - even to other buy-side traders. I'm sure it is rare for a head trader at one firm to share technology experiences and strategies with a head trader at another firm, or for them to discuss their ideas about the future. However, sharing that knowledge - comparing technologies, trading desk structures and processes - could lead to better technology and strategy decisions going forward.
That's why Advanced Trading created the Traders Gold Book - a Who's Who of prominent buy-side traders. Our goal is to enable the buy-side trading community to see how its most innovative leaders succeed at their jobs. We interviewed the head traders at buy-side firms of all types - from traditional mutual funds and pension plans to hedge funds - to get a snapshot of each firm's trading desk. And we asked each candidate the same questions so comparing firms' structures and philosophies would be easy.
The result? A special issue that offers a rare glimpse of how top buy-side traders operate, how they work with other executives in their firms, the technology they use, why they develop their own algorithms (or why they don't), what future trends concern them and much more. Since there was only so much that we could fit in our print publication, we also made podcasts of the full interviews available online at www.advancedtrading.com/goldbook2006.
I encourage you to be a fly on the wall and listen to these revealing conversations to get the full flavor of each of the trader's endeavors.
You'll find the traders featured in the Gold Book are similar in many ways - but also very different. Some are the sole person on their firms' trading desks, while others manage large global teams; some trade equities only, while others have traders that are well versed in all product types; some climbed their way to the top without a college degree, while others earned Ivy League diplomas; and at least one literally has scaled the face of a 1,000-foot mountain, while two others prefer drumming in their free time.
However, many of the trends they are watching are common, including Reg NMS, global mergers, dark pool expansion, navigating fragmented markets, commission-sharing arrangements and broker-dealer consolidation, to name a few. You can draw your own conclusions as to what you find most telling.
Finally, I'd like to thank each of the traders featured for their time and candor. And I welcome your feedback as to how we can improve the issue next year.