#GenerationTrader: The path to multi-asset trading

Published on 21 March 2022

In our #GenerationTrader series, Natasha Lauder of Schroders tells us how her career as a multi-asset trader evolved, from a background in physics which built her coding skills, into a data insights and analytics team.

Her experience in technology and consultancy provided great experience in supporting trading through technology and analytics, leading to a start in FX trading. Understanding of the market and data allowed her to understand rates and emerging market credit.

Significant differences in FX versus rates markets has further expanded her skills, applying her understanding of how data and applications can support different styles of trading.

Dan Barnes: Welcome to Trader TV Generation Trader where we explore the increasingly diverse backgrounds of traders and the effect that has on investors. I’m Dan Barnes and joining me today is Natasha Lauder, Multi Asset Trader at Schroders.

Natasha, welcome to the show.

Natasha Lauder: Hi, thanks for having me.

Dan Barnes: So what’s your background before you started trading?

Natasha Lauder: I bought my first share when I was eight years old. I used to save up and whenever I won money at a chess competition, I would watch the stock market in the evening while we were having dinner at home, and I’d ask my parents to buy some of the stocks for me. So I’ve always had a love for numbers. I decided to do a physics degree at UCL and that was actually my first taste of coding. So I did MATLAB there on my lab course. And then of course, as you’d expect, the physics degree, lots of analytical skills and numeracy skills as well.

And then I applied for the internship at Schroders. Managed to get onto that. And then thankfully also managed to get asked to come back for the grad scheme as well. I started the grad scheme in the Data Insights Technology Unit, learning how to use Tableau, which is a skill that I still use to this day, and I was producing dashboards for the distribution heads while I was in that team. And then I rotated into a business consultancy, so Schroders Internal Management consultancy team. And what they do is produce operating models for all of the different functions across the business whenever they’re required.

And then while I was in that team, the opportunity came up to go on a trip to Asia. So I actually went to Singapore, Indonesia and Taiwan for six months. And while I was over there, I was working with the traders. So we were just setting up Aladdin for our new order management system. And I had to teach the traders how to use Aladdin and that was my first taste of it, really.

So after that, I found a job opportunity and trading support. In that role, one of the first things that I wanted to do, probably because of my consultancy background, is do a high level flow of how trading works, like a front to back. So I sat with every single trading desk that we have and basically went through the lifecycle of a trade from picking it up to sending it to the platform to picking it out, all the different systems used. And then after that, I produced some dashboards, and I worked really closely with the FX team. So that was producing internal dashboards, basically showing how wide is a spread for each of the different currency pairs and different sizes as a good reference for us. You could identify which counterparties were strongest in those areas. And then also producing quarterly reports that are used in our counterparty reviews. And after doing that, I was fortunately asked to join the desk as a junior trader.

Dan Barnes: So then how has your role evolved?

Natasha Lauder: So my trading career started on the FX desk and I’ve learned how to trade every single instrument that we trade, focusing on, ‘where is it liquid? Where is it not liquid? What’s a sizable trade to stick down RFS vs where does it need to be traded voice?’ And then our FX desk also trades money markets.

What we do every single morning is we provide an update to portfolio managers on what’s happened in the market the day before and anything they might need to know. So in doing that and providing the update for FX, it’s obviously quite interlinked with interest rates. So that was my first taste of interest rates and then learning about that. And then after I’d been doing FX for a year, I started shadowing our rates traders, so that’s for the developed market. I’m also now learning to trade emerging market rates and emerging market credit.

The primary difference from what I’ve learned between those markets is with FX, you can basically always get a price, like if it’s a trying market, it’s going to be a wider spread, but you’ll always get given a bid and an offer, whereas in the rates market, it’s very, very different. Quite often it’s bidless. Or if they don’t hold the paper, then they can’t sell it to you. So particularly if you want to buy a bond, it’s a lot more difficult. So naturally, rates is a lot higher touch, even in really, really small sizes.

Dan Barnes: What new skills has that required you to learn?

Natasha Lauder: Predominantly, I think, risk management, just because the second you pick up a trade, you take ownership of that trade. So you need to make sure that you’ve got a strategy in place, depending on what the market’s going to do. Counterparty relationships is also very important. You need to know who to go out to and who’s strong, particularly in maybe different currency pairs, who you know is going to be executing in the way that you want it to be executed.

Dan Barnes: Very much so. Now do you think that trading desks are becoming more diverse and if so, in which ways?

Natasha Lauder: I do believe they are becoming more diverse, particularly around the skillset of the trader. Nowadays, I would say most people that are going to get hired will have a background in analytics or coding, and you don’t have to take the standard economics route. I know, I haven’t taken that route myself.

There’s more and more data now available, and we’re using more and more when we’re trading. We’re going to need to start utilizing that, particularly for having a look at our TCA. And if you have a look at how many trades are going electronically vs being traded voice, going forward; it’s definitely going to be a lot more multi asset trading. I think it is becoming more of a prerequisite that you have an analytical or coding background, because people are liking to bring that in house onto the trading desk. They don’t want to have another team working it out before them and having to wait two weeks for a report to be built. You want to be able to build it yourself, if you can.

Dan Barnes: What advice would you give to somebody who was looking at having a career in trading?

Natasha Lauder: I’d say you genuinely have to have a love for it. If you don’t, you’re not going to succeed in it. And I think, don’t get too stressed if you don’t take that route straight away, like it’s taken me six years to get here. I’ve taken a roundabout route and everything I’ve learned along the way has been helpful for where I am today. So enjoy the ride.

Dan Barnes: Natasha, thank you so much.

Natasha Lauder: Thank you.

Dan Barnes: I’d like to thank Natasha for her insights today, and of course, you for watching. To catch up on our other shows or to subscribe to our newsletter, go to TRADERTV.NET.