MP: I started on a proprietary trading desk. They used to be much more common back in those days than they are now. I went in as a trainee and, as I gained in experience, I started investing some of my own money as well, so I had a stake. Then I moved to another proprietary trading desk. Then, although I enjoyed trading, I realised I wanted to do something where I could interact more with clients so I moved into broking and sales trading.
My first job in sales trading was at a company called JNF Capital. I did well and they gave me my own team as well as my own trading desk. From there, I moved to Prime Wealth Group and then I moved here. That’s about it. My role changed, as you would imagine, dependent on whatever it was that I was trading. At the proprietary trading desks it was all about futures of mainly government bonds and from there I moved into the equity side for clients. One thing I have learned is that clients, even if they are professional clients, want to trade equities.
More than once, in interviews with investment banks, I was told that women get married and have children and so they don’t belong on the trading floor. Believe me that did happen – in 2008.
HOT: Could you tell me a bit about ZAI’s trading and investment philosophy and strategies?
MP: ZAI was originally a Corporate Finance Business with a Hong Kong brokerage dealing with Chinese clients. The Capital Markets operation here in London is an entirely new part of this business, dealing with advisory trading for professional clients. Our clients come from our brokerage in China and also from Europe and Latin America.
We offer a range of pre-sets which can be chosen either by the client themselves, or on our advice. The advisory side is currently non-discretionary but we are planning to move to discretionary.
Our brokers make suitable recommendations to clients and they make their own decisions based on those recommendations.
As far as the trading strategy is concerned, it’s primarily short term trading on equities and equities CFDs; buy today, and if you have a big enough position then exit tomorrow and if it’s an index then maybe in a few hours. We mainly trade FTSE 100 and 250 equities. Because of their liquidity we can go in and out quickly and easily. We might hold for up to a couple of weeks but no more than that. For longer term investments we tend to recommend cash equities, where we look for dividends and long-term performance. A lot of our Chinese clients have a lot of interest in the IPOs of Chinese companies that are listed on the AIM, particularly as we can now make those trades through Hong Kong. Those kind of trades do tend to be more long term.
The reality of the matter is that you need to be very exact, you need to be very careful, and you need to be sure that both you and the client understand exactly what is happening.
HOT: How much involvement do you have in choosing the trading platform and other technology for the firm?
MP: At the moment, we have one clearing broker with whom we are trading, and soon we’ll have another two. Yes, I do need to approve the trading platform. I need to like it, and I need to like the company. I need to be certain that there won’t be a problem with the clearing broker, that they won’t give us bad trade execution or bad prices and so forth. Over the years I’ve developed an understanding of who I like and who I don’t. Also, I’m the one who trains the traders that we bring in, so I need to like the platforms.
HOT: What was your experience of the 2008 crash and did that experience change your outlook in any way?
MP: At that time I was doing my second masters at an ‘’Ivy League’’ UK university. We thought everyone would get a job but nobody who graduated at that time could get a job, even if you offered to work for free. I started to question whether or not I really wanted to go into the capital markets side of things, if I really wanted to do trading. More than once, in interviews with investment banks, I was told that women get married and have children and so they don’t belong on the trading floor. Believe me that did happen – in 2008.
I find it very warming when people approach me and say, ‘I read this article and it really helped me because I was doing this and it helped me understand that.’
HOT: What impact, if any, are new regulations having on your day-to-day activities as head of trading?
MP: With the advisory clients, we have to be extremely careful. The reality of the matter is that you need to be very exact, you need to be very careful, and you need to be sure that both you and the client understand exactly what is happening. If the worst comes to the worst, and something goes to the FCA, you have to be certain that you have done everything properly. That the client was warned of the risks and so forth. Anybody can ask for money for anything. Yes, regulation has changed things, clearly it has, but I think mainly it’s a positive change. For instance, I think it’s a very positive development that traders now have to gain qualifications before they can give advice.
HOT: How important is it for a Head of Trading to continue to train, and in what particular areas?
MP: I think it’s very important. I always have to keep learning about new products, but also as Head of Trading I have undergone extensive management training. You need to learn interpersonal skills and training skills as well as keeping up to date with all the latest developments in trading.
HOT: You’ve published a number of papers. Is it something you enjoy doing and intend to do more of in the future?
MP: Yes, I really enjoy it. The articles tend to be educational, some of them are on the emotional side of trading but I have also published papers on many other aspects of trading. I enjoy writing. None of us knew much when we started. For me, to begin with it was just manic, crazy. As things started to get better for me, I felt that I wanted to help other people learn the ropes. I find it very warming when people approach me and say, ‘I read this article and it really helped me because I was doing this and it helped me understand that.’ Yes, I really enjoy it.
HOT: Finally, what do you like to do in your spare time?
MP: I don’t have that much spare time. When I do have time I like to go to the Victoria and Albert museum. I go there to view an exhibition and then I usually end up in the gift shop. Apart from that I do all the usual stuff like going out for dinner etc. with friends. I try to travel, but I don’t get much opportunity. I read books. I go to the gym.