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Everything you need to know about JPMorgan’s chief investment office and becoming Bruno Iksil

Where is Bruno Iksil?

Where is Bruno Iksil?

On the off-chance that you spent the whole of Easter holed-up in Dartmoor without internet access and have no knowledge of Bruno Iksil, let us fill you briefly in.

Bruno Iksil is purportedly a 30-something French trader. He lives in Paris and commutes in and out of London each week, but spends Fridays working at home.

Bruno spent four years working at Natixis between 1999 and 2003. There was a seeming two year hiatus in his career and then he joined JPMorgan in 2005.

At JPMorgan, Bruno works in the chief investment office in London, where he has become suddenly notorious for enormous trades related to CDS indexes – trades so large they are allegedly distorting the market. The Wall Street Journal says Iksil’s trades involve the Markit CDX NA IG 9 Index. He’s allegedly built up a position of up to $100bn in partially hedged contracts related to this. Over the past few years, he’s apparently made $100m a year for the chief investment office.

Destined to go down in history as another famous French trader, Iksil’s Bloomberg profile details his Frenchness, his interest in walking on water, and his humility. Persons who know Bruno say he’s a “fatherly” character and “not the sort of trader who drives a Ferrari and wears a Rolex.”

But what is JPMorgan’s Chief Investment Office?

The Chief Investment Office (CIO) is big. Ever since Bruno’s story broke, JPMorgan has been at pains to insist it isn’t a proprietary trading operation and is just part of the bank’s treasury business, where it simply manages and hedges JPMorgan’s risks and the assets and liabilities of the firm.

Unfortunately, JPMorgan’s insistence that the CIO isn’t about prop trading seems at odds with this thread written by people who claim to have applied for jobs there five years’ ago.

Back then, the Chief Investment Office allegedly described itself as: “a global proprietary trading business and cross asset-class manager for the Company as a whole,” and that it managed all of JPMorgan’s, “global structural interest rate and forex risk as well as taking proprietary positions in fixed income, forex, interest rate derivatives, credit derivatives and equity derivatives.”

Similarly, in 2007, Derivatives Intelligence reported that JPMorgan’s CIO had just set up a new macro fund to invest in equities.

Today, the CIO describes itself as:

“…responsible for managing structural interest rate, currency and certain credit risks that are created from the day-to-day operations of the firm’s primary Lines of Business across the company. CIO manages a global investment portfolio in order to manage these risks as part of the firm-wide Asset-Liability Management process.”

How can you work there?

If, like Bruno, you work for JPMorgan’s CIO in London, you’ll be reporting to Achilles Macris, who runs the EMEA business. 

Macris was formerly global head of capital markets at Dresdner Kleinwort Wasserstein, and a partner at Cardinal Asset Management, the London-based fund of hedge funds.

Also employed by the CIO is Patrick Hagan, the head of quantitative analytics, who has a PhD in applied mathematics from the California Institute of Technology. Hagan occasionally tutors courses in fixed income modeling. These courses may prove an opportunity to network with him.

The CFO of the business is Keith Enfield, a Cambridge graduate, who has worked across JPMorgan’s private equity, credit derivatives, and treasury businesses.

JPMorgan is currently advertising for a New York-based credit derivatives trader to work in the CIO. The specification reads like it’s looking for a cross-asset prop trader from another bank or hedge fund. Specifically, it wants:

“ 7-10 years financial services/investment management industry experience, with a minimum of 5 years trading/investing experience, preferably with experience in corporate bond markets, CDS markets (both index and single name), or other credit derivatives. A strong understanding of cross asset risks across Credit, Rates, FX, and Equity markets.”

How much will you get paid?

Although the CIO sits within the ‘corporate sector’ of JPMorgan Chase, if you work there you will get paid like a trader in an investment bank or hedge fund.

No one knows how much Iksil is earning, but Ina Drew, who runs the CIO, earned $14.8m last year and was one of JPMorgan’s highest paid executives.

The only downside to the CIO is its new-found visibility: under the Volcker Rule, banks aren’t supposed to engage in prop trading with their own money. However much JPMorgan protests that the CIO is just about hedging and liquidity management, it’s unlikely to have the same freedom to operate in future.

Comments (4)

Comments
  1. “Unfortunately, JPMorgan’s insistence that the CIO isn’t about prop trading seems at odds with this thread written by people who claim to have applied for jobs there five years’ ago.”
    That thread is from 2010…

  2. After hearing about them making a lot of money in 2009 (did’nt everyone), I interviewed with and rejected the CIO on Wood St London recently. Two reasons:

    They are supposed to be a hedging operation, but asking them about their prop positions, one of their traders’ response was ‘well if you have excess cash, what you gonna do with it?’ He then went o on to state where they invest. My take after that was: investing in a very risky illiquid markets (correlation trading, even Private Equity!) for profit when your primary mandate is to hedge just did’nt wash. They said they were working a lot with regulators to convince them that they were not a prop desk and had survived so far. There was and is enough uncertainty in this game these days, but this CIO – a prop desk masquering has a hedging shop – I thought was walking on thin ice, especially now.

    Second reason, their pay was weak. Not being a client-centric revenue-generating group, but part of their treasury, lowers pay drastically. Sure if you lead the group and report to Jamie Dimon then pay is good, but then it is so if you are that level and lead other groups too. Junior and mid-level traders, Ops and IT people are poorly paid. When I asked about their technology, they openly admitted that Ops and IT are fustrated as they ‘borrow technology (and support) from parts of the IB as it is cheaper’; so their support is weak and they do have ‘significant operational issues’.

    Anyway, as the article above ends with ‘its unlikely to have the same freedom to operate in future’, especially now Bruno Iksil has managed to bring major attention to them.

  3. Bruno Iksil is an idiot who has just lost $2B. Thats all I need to know.

  4. Another one bites the dust. And, quant risk-management my donkey.

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