Day in the Life: Benjamin Taieb, Foreign Exchange Options Trader
Benjamin Taieb works in Paris at Natexis, part of the Banques Populaires group, as an FX options trader. Initially trained as an aeronautical engineer, he graduated from Essec business school in France as a Master of Finance in 1997.0645 It's time to wake up. I am roused in one of two ways: either my alarm clock goes off or I'm woken up by by three year old son, who wants his morning bottle. It's simply a question of which one gets to me first.
0730 Having fed my son, eaten my own breakfast and got dressed, I leave the house and get the metro to work. .
0800 I arrive at the office and ease myself into the day. This usually involves standing by the desk with a warm coffee while I launch my computer-based risk management and pricing tools. Both are crucial to my job, and are my faithful friends.
As an FX options trader, I trade in options on euros, US dollars and pounds sterling. An option is the right to buy or sell one currency for another at a specific price and a specific date. The right to buy or sell can exist months or even years into the future, which makes my role an interesting one.
It's a question of assessing how macroeconomic and world events will affect foreign exchange prices, and working out what might be a realistic price when the option is exercised.
The risk management and pricing tools help me take everything into account. Nevertheless, trading options and complex products requires a very good background in maths and statistics, because you have to manage a lot of risks at the same time. Trading is a matter of managing and pricing a future risk .Fundamentally, I am a financial market risk manager.
After switching on my computer, I check my existing trading positions against market conditions. Conditions may have changed overnight. Foreign exchange markets are always active, which can make it a bit difficult to wind down and forget about work, even when you should be asleep!
0830 Affter listening to the morning meeting and gaining an update on overnight events on Wall Street and Tokyo, I'm nearly ready to start trading. The new market parameters, such as spot foreign exchange prices and price volatility, are already visible on the screen of my computer terminal.
I am a proprietary trader, which means that I work in close contact with our brokers, who let me know all the supply and demand requirements of banks in the world
0900From now on it's a matter of buying and selling options according to what we expect to happen in the market over the coming days and months. Right now, for example, we are very bearish regarding the value of the dollar against the euro: we think it's likely to fall. We therefore try to build an options portfolio that will increase in value if this happens.
1100 When the chaos of the early morning is over, I move on to the other aspect of my job: working with the sales team. Together with the salespeople, I help devise strategies for the bank's customers who want to hedge their exposure to foreign currencies. …