'Braveheart' trader brings his game to Canada
Makes Montreal base of operations
By SINCLAIR STEWART
Friday, January 06, 2006 Page B1
He's known as one of the world's best -- and ballsiest -- traders. He rakes in as much as $15-million (U.S.) a year buying and selling futures contracts, and his name appears in the annual Sunday Times list of the richest Brits. Oh, and he's 28.
But you won't find Andy Priston plying his trades on Wall Street. You won't find him in London, for that matter, or even Bay Street. Oddly, the man known as "Braveheart" for his fearless play in the markets is staking his lucrative bets in downtown Montreal.
Mr. Priston, a former trader at bankrupt U.S. brokerage Refco Inc., is setting up a new futures trading boutique in Quebec's largest city with a handful of ex-colleagues, and expects to open some time next month.
Montreal may not seem like an obvious location for this kind of business, but the city has several advantages that are beginning to lure foreign financial players away from major markets in the United States and Europe, Mr. Priston said.
"You don't have to be in New York or London to earn big bucks," he said. "Montreal is such a clean, fresh environment. It's the best of both worlds."
For one thing, the cost of living in Montreal is relatively cheap -- an important consideration for young traders just embarking on their careers -- and the wealth of universities provides a stream of potential recruits.
Perhaps more importantly, the province has introduced generous tax breaks for financial companies looking to set up shop here. Through an organization called the International Financial Centre of Montreal, companies that specialize in international securities and brokerage services can save 75 per cent on their provincial taxes. Their non-Canadian employees also save 75 per cent on their provincial tax bill for the first two years, 50 per cent for the following two years, and then 37.5 per cent thereafter. Canadian workers receive a 37.5-per-cent break.
"Obviously, international financial companies are going to say this is very beneficial to have," said Mr. Priston, adding that the tax breaks are "a big reason" that this industry is growing so quickly in Montreal.
Five years ago, IFC had approximately 70 foreign players accredited in Montreal.
Today, that number has more than doubled to 134, said Enrico Riggi, the organization's director of business development. The Quebec government has promised to keep the program open until at least 2008, and IFC expects it will be continued beyond that date.
Mr. Priston's new firm is a joint venture between London-based CFT Financial Ltd., a futures trading company, and First Continental LLC, a Chicago company with trading, clearing and alternative investment arms.
A London native who broke into the trading world when he was 22, Mr. Priston arrived in Montreal 15 months ago to train traders at Refco Canada. When Refco was pushed into bankruptcy last fall, amid allegations its former U.S. chief executive officer hid $430-million in debt, its operations were purchased by British hedge fund Man Group PLC. Mr. Priston declined an offer to go with the new owners, and opted to start afresh in Montreal -- the home, not coincidentally, of his fiancée.
He will be director of trading at CFT's fledgling Canadian operations, as well as a partner. The firm will initially have about eight proprietary traders, and is aiming to increase that number to 25 or 30 by year's end. There are also plans to open an office in Toronto, possibly as early as this fall.
"Prop" traders, as they are called in the industry, trade their firm's cash and sometimes their own capital, often with high amounts of leverage, as opposed to a trader who trades on behalf of a client's account. The CFT traders will focus on futures, which are essentially a contract to buy or sell a security at a specific date. These securities could include commodities, bonds, interest rates or any number of things.
However, the firm is restricting its focus to the U.S. and European markets, and will not be trading Canadian futures, which tend to be much less liquid.
Whatever he is trading, Mr. Priston will likely be doing it his way: aggressively. Senior traders quickly dubbed him Braveheart because of his bold style as an up-and-comer, and he's only now getting used to the name.
"It used to drive me crazy," he confessed. "But in a way, it kind of gets me going in the morning now. It feels like I'm going into battle." |
