Meet Conor McCann, Head of Derivatives Sales at Susquehanna International Group

Meet Conor McCann, Head of Derivatives Sales at Susquehanna International Group

by | Nov 2, 2021 | Blogs


Tell me a bit about your role and what it involves.

I look after the direct counterparty trading at SIG. I work closely with our sales traders who manage the relationships with our direct trading partners.

At SIG we facilitate off order book trading with various types of institution where we aim to deliver competitive prices that fit the needs of these trading partners. I am responsible for the pricing of these trades with a focus on the equity derivative space

A large reason that counterparties come to trade with us directly is our ability to minimise the impact of their large sized trades, we absorb the risks into our own trading book and look to limit the need to offload risk immediately into the market.

Outside of the pricing of these trades a large part of my role is to manage the risk we take on associated with this trading. I work within a group that is active in the inter-dealer broker market and liaise with our electronic market makers to remain plugged in to the trading and potentially avail of any opportunities that present themselves to recycle legacy risk positions that exist from our previous trading.

“A large reason that counterparties come to trade with us directly is our ability to minimise the impact of their large sized trades, we absorb the risks into our own trading book and look to limit the need to offload risk immediately into the market.”

What does a typical day look like?

I like to get into work around 7:15. I’ll spend some time pre-open getting set up complete and ready for the trading day. I try to get a feel for where the markets are, what’s driving them and to get my thoughts together for what to expect of the day, what needs work, what could happen that might change my thoughts.

Then we’ll, we’ll have a series of different meetings in the morning to share thoughts within the team. So we speak with some of our corporate researchers in the morning, we talk amongst the traders as well. I have a meeting with my sales traders to get the expectations of the day, get everybody on the same wavelength as to what’s important for the day. We are then ready to go once the market opens at eight o’clock.

Typically, I am quite busy for the first three hours making prices for direct counterparties. It’s rare that there is much free time during this period each day. Up until 11 o’clock is usually spent working on those core responsibilities of market making for our direct counterparty trading.

The 11 o’clock to two o’clock period is often a lot calmer, we take some time to figure out what’s going on, a little bit of reflection on how the trading has gone early in the morning.

We can use this time to schedule meetings, take some time on any projects that we are working on.

Trading often gets busy again in the afternoon. From two o’clock to 4.30 I’ll often be spending much of my time on the direct counterparty pricing again.

At the end of the day there’ll be a lot of discussion on the desk and with different people about what has gone on and what we think could be important for tomorrow. Preparation for the next day is already beginning. We also take that time to reflect on what has happened and what are the key takeaways. 

What is it that you like about working about Susquehanna?

I’m interested in the financial markets in general, so like the sector that I’m working in. In terms of working for Susquehanna, I like working for a firm that operates in a high-performance manner with a process driven and best practices approach to what we do.  We have a reasonably casual office environment but have a large work force that are all very engaged in the work. I like my colleagues, I think a lot of firms can talk of teamwork being important to them, but in Susquehanna, we certainly do live that. I find the team emphasis rewarding and do think it crucial to our success.

What is it that makes you proud about what you do?

I am proud that we are an important part of the markets that we participate. If we’re trading a product, we aim to properly trade the product, and have a positive influence on those markets.

I’m very happy that we have good relationships with the exchanges and with our trading partners and that my role allows me to have some influence in this regard. We don’t just focus on our own activities-we care about and pay attention to the overall market structure and want to see the market benefit all market users and grow.

 

So how did you get into market making like why did you choose it?

I came to it somewhat late, at university I took a pathway where I studied mathematics and statistics and pure mathematics was probably the largest chunk of my degree.

I was looking at roles that mathematics might be a good gateway into, and I knew of Susquehanna from being in Ireland and they were beginning to build a presence at our college.

I was increasingly intrigued as I learned more about the company, I was very drawn to the real interest in decision making and game theory. It gelled very well with my own interests and background.

  

“We don’t just focus on our own activities-we care about and pay attention to the overall market structure and want to see the market benefit all market users and grow.”


What do you think it takes to be a market maker?

In our office there’s definitely different ways to go about things, I certainly don’t trade in the same way as everybody else and there’s no one size fits all. Having said that there are some key skills you’ll need. Most important is being a clear thinker. Being able to manage a lot of information, make accurate inferences from that information and be comfortable in an environment where you don’t have full information, but still be able to make decisions.

Enthusiasm is incredibly important. I’ve been doing this for 14 years and I’m still learning things, I don’t think anybody ever fully masters market making so you do have that drive towards self-improvement. Self-awareness and critical self-analysis are important tools to have or to develop.

The #WeAreMarketMakers campaign is about highlighting what market making adds to the markets and society. What is your perspective on this?

 The key function of market making is, is to be able to provide a tradable price when it’s needed. The immediacy here is a crucial part of the service we provide. This ultimately reduces costs for investors and promotes liquidity which has the added benefit of reducing the cost of capital for companies. This in turn is a benefit to society.

Increasingly a further value add is for us to help in holding our share of the risk in our markets. The risk ultimately must be taken on, we play our part in this, pricing it correctly and holding and managing the positions through time. This helps absorb price shocks in volatile market conditions and I think this is an important function to provide to help facilitate a healthy, stable market.

To find out more about Susquehanna International Group (SIG) visit www.sig.com

Meet Alex Kieft, Head of Trading at Flow Traders

Meet Alex Kieft, Head of Trading at Flow Traders

by | Oct 27, 2021 | Blogs

Tell us about your role at Flow Traders, what does it normally involve?

Well, I joined seven years ago as a junior trader. After five years I became head of trading. So now I am responsible for about 40 traders and quant researchers that are working at Flow Traders in Amsterdam. I am involved operationally with the trading desks, mainly the equity desks, and I spend about 50% of the time working alongside the traders, motivating them, helping them with trading decisions where needed. From a leadership perspective, my role is about developing talent and therefore I aim to be approachable, open and flexible with the team. And then the other 50% of the time I spend more strategically on the long-term goals that we have at Flow Traders, namely becoming a one stop shop for liquidity in all financial products.

 


What does your day typically look like?

Yeah, so we come in early in the morning between 7.30 and 8.00, then we get briefed on the news that happened overnight in the Americas and Asia. Afterwards, I personally check in with all the desks to make sure there’s nothing extraordinary going on, helping them where needed to make sure we’re ready for the market open at nine o’clock, because then we need to make sure that we provide liquidity in thousands of instruments.

Then during the day, I am still checking in with traders whenever there’s something extraordinary going on, helping them along. And again, spending a considerable amount of time more strategically.


What do you like about working at Flow Traders? And about Market Making?

Everybody is extremely driven, determined to be the best every time. We’re also very tech savvy, so there’s plenty of opportunities to keep learning every day. We focus on fostering a dynamic and collaborated working environment. I have great co-workers, very international and also very diverse.

Market making is very fast paced and you immediately see the results of your actions. I have a background more in theoretical physics, where you can spend years researching something that may yield a result or not, but in trading it’s very binary. You immediately see the results and then that’s something that gives me a kick.

“Market making is very fast paced and you immediately see the results of your actions.”

What is it that makes you proud of what you do?

Two things, the first is that I’m part of this company that is very successful and one of the leading market makers. We’re successfully expanding into asset classes like bonds, currencies and cryptocurrencies, where we have this ambition of becoming a one stop shop for liquidity in everything.

And then, on a more personal and role based level. I feel proud whenever the new generation of traders comes in and I can help them grow and become sort of where I’m at now in my career. Whenever they do well that makes me pretty proud.


How did you get into market making, why did you choose market making as a career?

I had some affinity with trading but not that much. I was particularly attracted to the competitive element that is in there, as well as the people that I met in trading were extremely smart, and I thought to myself that I wanted to be part of this industry where you have an entrepreneurial mindset and people always wanting to be the best.

The impact that Flow Traders has and the relevance of being a market maker is also what appealed to me. Seeing the impact in practice and how we contribute to the efficiency and transparency of the market is really interesting.


What advice would you give to others who might be considering a career as a market maker?

If people have got what it takes and want to work alongside the smartest people, then I can only recommend that they do it, and we at Flow Traders like to create an environment for those kinds of skills to flourish.

We really stimulate people in their career so that they can grow from coming basically fresh from university with just an analytical skillset and not so much knowledge about financial markets yet, and within a short amount of time, we can teach them all the stuff they need, and then they will quickly grow into being successful traders themselves.

 

 

What does it take to become a market maker?

Well, obviously it does start with an interest in financial markets. You should be able to handle a dynamic working environment well, be able to react quickly. Next, you need strong numerical and analytical skills. Also, being able to crunch data.

Then on softer skills, here we really value teamwork, because we need to rely on each other on the trading floor and when we collaborate with different departments and regions effectively.

And finally integrity is a very important value for our traders.


The #WeAreMarketMakers campaign is about highlighting what market making adds to the markets and society. What is your perspective on this?

Flow Traders and other market makers serve society by improving the markets. We provide liquidity in many financial products which contribute to more efficient flows of money and capital, we lower the overall trading costs for any sorts of investments. We make sure investors, big and small, can trade at any time in the product they prefer,  for example, if they want to invest in green energy, market makers make it possible for them to do that at reason or at the lowest possible transaction costs.  We have a warehouse function as well. Every investor can trade any financial product under every circumstance with us. Even during real stressful times like March 2020, market makers made sure the financial markets were available and provided the necessary relief for investors in need for liquidity.

As a market maker we respond to whatever the needs are of investors. And we see increasingly that investors are focused on the ESG segments. There are now in Europe over 400 different kinds of ESG ETFs. And we trade on a yearly basis over 50 billion euros in such ETFs. We try to make sure that it’s as efficient and as cheap as possible for investors to invest in these segments.

“We provide liquidity in many financial products which contribute to more efficient flows of money and capital, we lower the overall trading costs for any sorts of investments.”

If you could tell people, one thing about market making and what it is that you do, what would it be?

As a market maker we provide liquidity so we make sure investments are possible, and people don’t have wait to do business. For example, hypothetically, if you have an illiquid asset, it can take you days or weeks  to sell it and you probably need to make a lot of phone calls to find a suitable buyer. With market makers in between, we make sure that at any given time, people can transact in these products and don’t have to wait until there happens to be interest on the other side.

A key impact of a market marker is also creating efficiency and transparency across the market.

 

 

To find out more about Flow Traders visit www.flowtraders.com

Certainty amidst uncertainty: How the Covid-19 pandemic catalysed a paradigm shift for market makers

Certainty amidst uncertainty: How the Covid-19 pandemic catalysed a paradigm shift for market makers

by | Oct 15, 2021 | Articles

Interview with Piebe Teeboom, Secretary General at FIA European Principal Traders Association (FIA EPTA)

 

Q. FIA EPTA’s latest thought leadership report, Liquidity in the Time of Covid explores how the Covid-19 pandemic changed the role and reputation of market makers. In your opinion, how significant has this change been?

In recent years, market makers have been playing a growing role in liquidity provision within European capital markets. But it’s fair to say that this has been an ongoing evolution, not revolution, and has been happening somewhat under the surface.

However, when the pandemic hit, all of that changed. Many more market participants needed to quickly change the way they accessed liquidity, and market makers offered a reliable and very efficient way for them to do that.

Covid-19 catalysed a paradigm shift in the way people perceived market makers’ value; and in the amount of added value market makers were able to bring. To the markets and to wider society.


Q. What were market makers offering during the pandemic that others were not?

The short answer is certainty. Whether you are an asset manager or a retail investor, the fact that market makers commit to being always present in the markets means you can always buy or sell when you want to, and at the best price. You’ll never have to wait to make a transaction.

You can imagine how important that certainty was during the Covid crisis, when all around there was so much uncertainty and trading was , incredibly choppy. It’s why the pandemic created a real light-bulb moment for asset managers in terms of the way they view and engage with market markers.

“The pandemic has the pandemic created a real light-bulb moment for asset managers in terms of the way they view and engage with market markers.”

 Q. Now that the initial uncertainty created by Covid has passed, do you think the more central role market makers have carved out will continue?

I think we are entering an exciting new chapter for the market making community because they are now being seen more as a genuinely viable and reliable option when it comes to liquidity provision. They have shown the benefits that cutting-edge electronic trading can bring to the markets, especially in the bond space.

The buy side asset managers interviewed for the Liquidity in the Time of Covid report were clear that they are keen to have more diversity now in the way they access liquidity, with market makers emerging as new liquidity partners in the wider market mix.

I think that what the last year or so has taught market participants is that greater diversity of options makes for more resilient financial markets that can weather unexpected storms. And that is good news for market makers and good news for everyone else, from nest-egg investors to asset managers.

“The last year or so has taught market participants is that greater diversity of options makes for more resilient financial markets that can weather unexpected storms.”

 
Q. Did you launch the #WeAreMarketMakers campaign as a response to the changes brought about by the pandemic?

The catalyst for the campaign was actually much closer to home. This year marks the 10th anniversary of FIA EPTA and, just as we have evolved as an organisation over the last decade, so the market making community that we are proud to represent has further matured in that time too. We wanted to do something to mark our 10 year anniversary that would also show the contributions of modern market makers to European capital markets and wider society.

One of the key aspects of the campaign will be putting a face to the innovators behind the code. You’ll see lots more of them over the coming months. We’ll be launching more thought leadership reports exploring different aspects of why liquidity matters so much to well-functioning markets. And we’ll be tackling some of the common questions those in the market making community receive about what they do, and how they do it. Perhaps addressing some myths head-on too.

While the pandemic wasn’t the reason for launching #WeAreMarketMakers, it has created a timely conversation about the market making community and its often unperceived benefits to markets and wider society. Today, the campaign feels more relevant and important than ever.

 

THE ‘LIQUIDITY IN THE TIME OF COVID‘ REPORT IS AVAILABLE TO DOWNLOAD HERE.

Paradigm shift as market makers take center-stage

Paradigm shift as market makers take center-stage

by | Sep 28, 2021 | Press releases

Paradigm shift as market makers take center-stage in European liquidity provision during Covid-19 pandemic

  • New research report reveals independent market making firms becoming trusted partners to European buy-side after stepping up to support institutional investors during pandemic
  • Surveyed asset managers appreciate market makers’ continuous presence in the markets
  • Recognition accelerated by adoption of technology and screen-based electronic trading during lockdown

The ability of independent market making firms to provide essential liquidity to Europe’s pension funds and other asset managers during the Covid-19 financial crisis has accelerated their recognition as a vital part of the European capital markets eco-system.

A new research report surveying European buy-side participants reveals for the first time how market makers stepped up to help the asset managers when some of the traditional providers of risk capital partially withdrew from certain market segments in Europe in the early stages of the pandemic.

As asset managers – particularly small and mid-size funds — were seeking additional sources of liquidity the independent market makers were able to step up. This was made easier as the increasing electronification of the markets enabled asset managers and market makers to engage whilst working from home.

Now, clear signs are this shift is becoming permanent as asset managers better appreciate what market making firms’ offer as liquidity partners, including greater transparency and continuous presence in the markets.

These benefits mean investors can trade instantly and with certainty, enabling them to adjust their investment strategies and manage their risk.

The insights are published today in a new study called Liquidity in the Time of Covid. It Is based on detailed interviews with 30 EU and UK-based Global Heads of Trading at asset management firms holding $35.6 trillion collectively.

The study is written by independent financial services research group Redlap Consulting. It was commissioned by FIA EPTA, which represents Europe’s leading market making firms, to drive greater understanding of what independent market making firms do, and their contribution to both financial markets and the wider economy

Report author Rebecca Healey, founder of Redlap Consulting, said:

“Covid-19 continues to redefine the trading landscape as the pandemic lifted the veil on the role market-makers can play in liquidity formation.

 

“Liquidity challenges in bond markets early in the pandemic created a vacuum forcing the buy-side, to find new trading partners and access points to liquidity – and market making firms stepped up to fill the void.

 

“Now as asset managers continue to partner more directly with these firms, they have been able to benefit from a wider, more diverse pool of counterparties in how and where they can execute investment strategies; while liquidity providers have the opportunity to re-position themselves and build new partnerships.”

 

One Head of Trading at a large global asset manager interviewed for the report said: ““We definitely engaged more with [electronic liquidity providers]; as [some sell-side firms] stepped back, they stepped up.”​

Piebe Teeboom, Secretary General of the FIA European Principal Traders Association, said:

“The clear message from this report is that asset managers have developed a far more detailed and positive understanding of market makers and the liquidity provision they offer.

 

The pandemic and, in particular, the lockdowns accelerated a longer-term shift towards screen-based trading as people were forced to find new ways of working. This created a watershed moment as the buy-side engaged more with market making firms – and consequently became more appreciative of the benefits of better and more transparent prices, the constant liquidity provision and optionality the firms offer.

 

“That reappraisal and recognition – similar to a light-bulb moment – has now cemented the role of market making firms as mainstream actors in the capital markets ecosystem.”

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