One of Brevan Howard’s longest serving traders seems to have messed up.
Bloomberg reports that Brevan Howard has had some problems with its commodities fund. The fund, which was opened in 2010 with $200m in assets under management, had $630m in assets at the last reckoning. It was run by Stephane Nicolas, a veteran trader whom we profiled when the fund opened. Nicolas joined Brevan in 2004 and was made a partner just three years later. Before joining London’s most prestigious hedge fund, he worked for SocGen, BofA and DRW (a prop trading firm) and graduated from a French Grande Ecole. None of this seems to have helped him navigate this year’s complicated commodities market. – The Brevan commodities fund reportedly lost 4.3% between January and October and has now been shuttered.
Usually, Brevan Howard is extremely intolerant of employees who make losses. In Nicolas’s case, it seems to have made an exception. – His fund also lost 4.2% last year and for the moment at least, Nicolas is still listed as a Brevan Howard employee on the FCA Register.
Separately, banks ought to hire more 53 year-olds. According to a study by academics at Harvard University, 53 is the optimum age for financial decision making. This is reportedly the moment at which the combination of ‘crystallized intelligence’ (intelligence and skills derived from experience) and ‘fluid intelligence’ (the ability to solve new problems) is at a peak. Beyond 53, however, financial decision making declines as fluid intelligence wanes and crystallized intelligence doesn’t increase enough to offset it. When banks pick up 53 year-olds, they may want to do so on short term contracts.
Sexism is a problem in fund management. “I can’t dress like I would in another job and I purposely don’t wear make-up.” (Financial Times)
Banks’ compliance functions need ex-traders and data mining experts to deal with the psst-fixing scandal world. ““If an average trader’s been hitting the same benchmark or better than peers on their desk but the volume of messages they’re sending on internal messages is significantly less, that’s a red flag.” (Financial Times)
Could Goldman Sachs go private? (Benzinga)
The fundamental knowledge you need to become a UK telecoms banker. (Guardian)
Even female Harvard graduates with high earning spouses are less likely to work than those without. (NYTimes)
Now that banks aren’t holding or making markets in bonds, it now takes seven times as long for investors to liquidate bond portfolios as in 2008. (Financial Times)
“I was at a conference with a few institutional FX managers and everybody had this grin on their face. Finally, finally, volatility is back.” (Bloomberg)
Innovation is still permissible in retail banking. (Guardian)
How to disagree with your boss. (HBR)
London Business School would like to admit more non-bankers onto its MBA progrmame. (PoetsandQuants)