- Can you introduce yourself?
Hi Everyone! My name is Alain, I'm 23 years old and I grew up in a suburb of the Hague. I have been working at Optiver for about 8 months now where I'm currently an execution trader trainee in the Single Stock Options team. The first three months at Optiver I followed the general trader trainee program that all new traders do. Then I spent a brief time in the Index Options team before landing at my current spot. Before joining Optiver, I graduated from TU Delft with a BSc in Aerospace Engineering and did about 2 years of IBA at RSM. Last year I was part of the 36th board of B&R as the commissioner of Education & Career.
- I see that you have studied both at Delft and RSM. How did these different backgrounds contribute to your career choices/successes?
I think both backgrounds contributed in different ways to where I am now. Doing a more quantitative program like engineering gave me a background in programming and helps to feel comfortable working with numbers all day. On the other hand my time at RSM is what initially got me interested in financial markets as I joined B&R in my first year. Moreso than in Delft, studying at RSM helped me to develop my social skills.
- You started working right after you finished your two bachelors. Are you planning on doing a masters?
When I was applying at Optiver about a year ago, I was actually going for a part-time position while planning to do a premaster quantitative finance at ESE. My end goal was already to hopefully start working at Optiver after completing that masters. So when I got an offer to join Optiver full-time instead, it was an easy decision to make! For now I'm very happy where I am and I have no plans to do a masters.
- What does it mean to be an execution trader at Optiver?
As an execution trader, I am in contact with brokers all day. They get orders from their clients to buy or sell certain option strategies for which they try to find a counterparty. These are almost always so-called block trades; trades that are above a certain size that you cannot easily execute on the exchange. As a market maker, we provide brokers with a bid and ask price for the options they are looking for. After we provide them with this initial market, it's a negotiation with the brokers to get the best price and execution for us. To do this, it's also key to develop and maintain good relationships with the brokers. Large trades like this have good information on supply and demand in the market, and it's up to the execution traders to get the information and share what's relevant with the rest of the team.
- Where do you see yourself in 10 years from now on?
Since I haven't even worked at Optiver for a year, I find it pretty difficult to answer this question! In 10 years, I hope to still be working as an execution trader and enjoying the work. At some point, I would also like to work in one of Optiver's other offices like Chicago or Sydney.
- Which skills do you need to be a successful Execution Trader?
In general as a trader, you need to be comfortable working with numbers and doing quick mental math. During busy days, the work can be very intense and you need to be able to perform well under pressure. To deal with brokers and the traders, it's also important to be confident and critical of what people tell you. Finally, you'll need excellent communication skills. It's your job to get the most information from brokers, and give them the information you want to give and nothing more. Small nuances in how you or they phrase certain things can make a big difference for what information you can get, if you know what to listen to.
- What are some of the most important things that you learned at Optiver?
One of the most important things is that it's really up to you to make the most out of your career. Don't get me wrong, everyone I've met so far is very willing to help you with whatever you want to learn, and the foundation you get from the trainee program is very strong. But once you get on the trading floor, it's really up to you to figure out what you want to improve on and learn.
Another thing that is key, is that there's not always a clear cut right answer for everything. Every trader has their own style of trading, and it's up to you to discover your own style. Finally, it's important to have self-confidence and stand up for yourself. When you start working, it's easy to look up to some of your colleagues with over 10 years of experience and assume that whatever they say is correct. But still, there are moments where they are not right and by challenging them you can positively influence the team.
- Which trends do you currently observe in trading?
Right now, I would say there's a lot of topics and issues that impact trading. Of course there's the ongoing Covid-19 pandemic, stimulus news coming out of the US, uncertainty regarding central bank policies and inflation. And then there's the more unknown factors, like the short squeeze in GameStop earlier this year. On any given day, these stories could have no impact on markets but when some unexpected news comes out for one of these, markets react quickly.
For us at Optiver it's all about being ready for when that happens. Preparing and thinking about possible scenarios, and what to do in those scenarios ahead of time.
- What is your favorite mathematical formula, and why?
As an options trader, the Black-Scholes equation is indispensable to what I do. Although it certainly has its limitations, everyone trading options will use it in some form.
- You have been on the 36th Board of B&R Beurs, can you tell us how this helped you starting your career?
It helped me in several ways. First of all, the freedom you get in a board year to do things your way and focus and what you think is important for the association is great. It really forces you to get creative and think about long-term strategy as well as how to implement things in the short term. Another thing that was great for me, was meeting and speaking with a lot of industry professionals. For me, this was a great way to figure out what career I wanted.
- What was a memorable moment for you at Optiver?
The first trade I did worth more than a million was definitely a memorable moment and it still feels kind of crazy thinking about it. But one thing that's also very much in the mentality at Optiver is that we are always looking ahead to the next trade, so you don't think back on your past trades that much.
- Do you have any advice for students that want to dive into the world of trading?
My first advice would be to make sure you know what you're getting yourself into. Trading is a pretty niche job, that I don't think many students have a good understanding of what we actually do. I would recommend speaking to traders to try and figure out if what it's something for you.
Both in terms of the work traders do on a day-to-day basis, as well as the culture on a trading floor.
If you wish to have more information about trading or Optiver feel free to contact Alain on LinkedIn: https://www.linkedin.com/in/alainfaddegon/