Porter threatens to quit...from the Globe and Mail...
Toronto traders cope with life at ME
BERTRAND MAROTTE
Quebec Bureau
Monday, April 24, 2000
Montreal -- The welcoming party was held to give the Toronto stock
option traders, freshly arrived in Montreal, a taste of some of the city's
multicultural offerings.
To celebrate the final step in the move of all equity options trading from
the Toronto Stock Exchange to the Montreal Exchange, beer was
served in cups emblazoned with the famous red-white-and-blue logo of
the storied Montreal Canadiens hockey club. Smoked meat was
carved by staff from legendary Schwartz's delicatessen on the Main.
And as a parting gift at last month's bash at the ME, the uprooted
traders were each given six bagels to put in their empty refrigerators.
Kidding aside, the Toronto traders who decided to make the leap to
Montreal in the wake of the national realignment that shifted all
Canadian derivatives (options and futures) operations to the ME are
experiencing a kind of forced migration.
Stress levels from the upheaval are high.
Leaving family and loved ones back in Toronto and returning on
weekends, which many of the traders have chosen to do, is tough.
But there appears to be little culture shock in adjusting to a society that
is majority French-speaking, not to mention the dicey political situation
arising from the separatist threat. Within the protected confines of the
ME's busy trading pits, business is conducted in English anyway.
And many Toronto traders have simply avoided the potential hassles of
la vie en fran‡ais by keeping their houses back home, taking a
bachelor apartment in Montreal, and commuting home on weekends.
They plan to split their lives until fully electronic trading comes into
effect within two or three years, which will allow them to trade from
anywhere.
That said, any fears of resentful Montreal traders treating the
newcomers from Toronto like second-class citizens or "maudits
anglais"from the evil city by Lake Ontario haven't been borne out.
Systems shock is more like it, as the 15 or so new arrivals in stock
options try to cope with slowdowns caused by the surge in trading
volumes since the arrival of the TSE options market.
Helping to cushion the aggravation is that for some time the
stock-option business has been terrific, with many traders pulling down
seven-figure annual incomes. The buoyant market even helped
convince some reluctant Toronto traders to make the move to
Montreal or postpone early retirement, said Alon Farkas, an equity
options trader.
Mr. Farkas had been at the TSE for 1« years before coming to
Montreal on March 27.
"Most of the traders are having maybe their best year ever," he said.
However, independent traders -- those not affiliated with a brokerage
-- are not pleased with hefty fees they must pay and equipment
purchases they must make to work at the ME.
As for technical glitches: "The system just wasn't equipped to handle
the increase in volume," said Mr. Farkas, a Toronto native. "It was a
big fiasco. The system immediately went into a state of overcapacity. It
was jammed with too many orders."
(A stock option is the right to buy or sell a security at a specified price
within a specified time. Futures involve contracts in which the seller
agrees to deliver a commodity or financial instrument at a set price
sometime in the future.)
The frustrating delays in getting correct quotes and executing trades
have for the most part been corrected, said Mr. Farkas. But one
brokerage firm employee, who did not want to be named, said the
slowdowns -- up to one hour -- continue.
"We're trading blind in a fast market," she said.
One transplanted Toronto trader posted an angry missive on an
Internet chat site threatening to quit Montreal if conditions don't
improve.
ME spokesman Andrew Molson said most of the problems have been
addressed. "There were some difficulties in getting quotes from the
trading floor to third parties using screens," he admits. But now, "it's
business as usual on the floor."
The 126-year-old ME -- with its traditional open outcry system -- is
now Canada's only remaining trading floor. Chicago, Montreal's big
derivatives rival, also has retained its trading floor.
Paul Lee, coming off his first week of trading at the ME, said he's over
the crushing loneliness he felt on his first day in the city -- his wife and
12-year-old boy and nine-year-old daughter stayed behind in Toronto.
"It was very hard to cope the first day and the first night. You don't
know anybody in the whole city. You're all by yourself. I wasn't sure
I'd be able to continue," confesses Mr. Lee, 39, who views the
upheaval as brightened considerably by the prospect of enrolling in
McGill University's topnotch Faculty of Music this September to
improve his operatic singing.
Nonetheless, he views the move as a tryout. He hasn't yet decided on
a long-range plans, including whether to have his family join him in
Montreal.
His lack of French -- so far -- is no drawback, he said. He gets by fine
in English.
Mr. Farkas intends to take French lessons. But he said the political and
economic uncertainty are not a major concern for him or his fellow
displaced Torontonians. After all, he explains, traders have a
notoriously short-term perspective.
"I don't think many of them see Montreal as their new long-term
home." They figure they'll be gone within two years, he said.
"They're not thinking of the long-term future of the province or even the
city." |
