From coffee futures to the coffee table
By Jeremy Grant
Published: November 16 2004 02:00 | Last updated: November 16 2004 02:00
Jason Edwards, 28, moved to Sydney from London a few years ago to work for TransMarket Group, a Chicago-based firm that trades derivatives on its own account.
He heads to the office in Australia at 10pm, where he spends the night in front of a computer screen, buying and selling futures traded on exchanges around the world, including the Chicago Mercantile Exchange - in the city where his employer has its headquarters, many time zones away.
By 8am the next morning, Mr Edwards heads to Bondi Beach for a sunrise breakfast before getting a few hours' sleep. Resurfacing, he heads back to the beach - perhaps with a couple of friends - to catch some waves. "I'd rather be surfing in the afternoon than sitting at a desk," Mr Edwards relates in the first issue of Trader Monthly, a magazine launched yesterday in New York.
The magazine, founded and funded by Magnus Greaves, a Canadian former futures trader, is the first publication to target a new community of people such as Mr Edwards: the professional trader.
Usually male, often in their 20s and 30s and always hungry for the next deal, the members of this group are emerging amid the explosive growth of electronic trading, especially in futures and options.
Whereas the now largely extinct day trader of the 1990s was trading equities in a steady bull market, these players are riding a roller coaster of risk, fed by geopolitical uncertainty, volatile metals and commodities markets and an environment of rising interest rate expectations.
With returns from equity markets low, such an environment has turned derivatives instruments - for instance Eurodollars, which measure expectations of the direction of US interest rates, German government bond futures, wheat futures and options on the Standard & Poor's stock index - into the most traded financial instruments in the world.
These traders are not playing the markets in the famous "open outcry" trading pits of Chicago, where men and women in colourful jackets jostle as they shout out orders. They are plugged into exchanges remotely, from offices across the globe.
Mr Greaves believes that, with the decline of pit trading and the loss of the sense of community that came with it, there was an opportunity for a magazine that could recreate that community for traders dispersed around the world.
He has a unique perspective: when the pits closed at the London International Financial Futures Exchange in 1998, he and some partners set up MacFutures, one of the most successful derivatives proprietary trading firms when it was sold to Refco, a brokerage, for $50m (£27m) last year.
"We had 500 traders at MacFutures and I just noticed one day that on their desks they had men's magazines and trading books. But there was something missing. None of the magazines out there were serving these guys. I thought that while electronic trading was pushing the industry forward, one of the things that was missing was the interaction," he says.
Trader Monthly's aim, he says, is "to replicate the functions of the floor to serve as the central gathering place for traders everywhere to exchange ideas and stories and find out what's going on". An equally important focus of the magazine is the lifestyle of the trader. In the hard-driving world of trading, there is as much an emphasis on how to spend money as there is on making it. That explains the publication's in-your-face slogan: "See it, make it, spend it".
Trader Monthly steers clear of "how to" stories about trading, leaning instead towards features on private jets, fast cars, golf trips and $16,000 flat screen, plasma TVs. Regular features include a column by nine-time World Series of Poker champion Johhny Chan, who dispenses advice on risk; while "Celebrity Trader" charts the fortunes of a celebrity handed $50,000 every month by the magazine to trade as they see fit.
A story headlined "Will My Heart Palpitations Kill Me?" addresses one of the downsides of trading, besides the consequences of a poorly-judged deal: the fact that many traders exist on poor diets, little sleep and too much stress.
"Trading is a lifestyle, it's not just a job," says Randall Lane, editor-in-chief and a former Washington bureau chief for Forbes magazine. "We thought there should be a magazine that treats traders as the rock stars of the financial world."
In a clear nod to Forbes, Trader Monthly's launch issue leads with the first list of the 100 highest earning traders. The eye-popping figures help explain why trading is attracting young people such as Mr Edwards in Australia. Topping the list is Steve Cohen, a 48-year old equity trader at SAC Capital Advisers in Connecticut, with estimated annual earnings of $500m-$550m. At the low end is Margie Teller, a eurodollar trader on the Chicago Mercantile Exchange, with $5m-$10m a year.
"The financial side [of trading] is hugely appealing to young guys," says Mr Greaves. "Your average guy leaving university isn't going to be able to make six or seven figures unless he's going into professional sports or trading."
HOW NOT TO BECOME JUST ONE OF THE LADS With its unashamedly male orientation reflecting the gender tilt of the trading word, what are Trader Monthly's chances of making it where the "lads' mags" have recently been struggling? Magnus Greaves is the first to admit that Trader Monthly, with its launch cover depicting a female model pressed up against a star trader, is for a male audience. But he says: "Who's a Maxim or FHM reader? Potentially it's a huge population - but at the same time it's vague. "After a couple of years, the readers of those magazines are looking for a different type of publication to serve a different interest in their lives, because they are no longer just focused on football and having a laugh - now they're focused on their careers. The focus of Trader Monthly is guys who have decided to be traders for a living and we're addressing issues in that environment." What has Mr Greaves done to get Trader Monthly off the ground?
* Distributed 100,000 copies, produced by a staff of 20, by working with the derivatives exchanges and various trading companies. "They've been very good at uncovering where the pools of traders are," says Mr Greaves.
* A seven-minute appearance last week on CNBC, the US financial TV network. This generated 200,000 hits on traderdaily.com, the magazine's website.
* Launch parties in New York, the magazine's headquarters, and Chicago. These cities are home to two of the world's largest trading communities.
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