Rates traders have had a terrible year. So they're swapping jobs

2024 has not been a good year to work in rates trading. The realized and unrealized gains of Goldman Sachs' macro traders fell 78% in the first six months of this year, and the firm said in October that its third quarter rates revenues were significantly lower. Nor is Goldman the only place struggling: BCG Expand estimates that European rates trading revenues were down 43% year-on-year in the first nine months of 2024. 

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Perversely, or perhaps inevitably, the collapse in revenues has prompted a mass shifting of jobs in a year when rates bonuses are likely to be weak. 

The latest change is at Nomura, where Bloomberg reported today that Ali Khan, the head of EMEA rates and exotics options trading, has left after 16 years to "pursue other opportunities." There are rumours that he's off to join a multistrategy hedge fund. If so, he won't be the only one.  

Hedge funds have hoovered up macro trading talent in the past few years, and continue to do so. Last December, Pushkar Jha, Goldman's London head of inflation trading, Urvashi Chahal, a VP-level rates trader, and Shahil Ghelani a European rates trader, all left Goldman Sachs for hedge funds over the Christmas period, without waiting for bonuses to be paid. Since then, Balyasny has hired Aditya Singh from Goldman as macro portfolio manager in London and Deutsche Bank and UBS have both lost senior rates traders to Verition, among others. 

Headhunters working in the space say top rates traders have used 2024 to position themselves for what are likely to be stronger years of revenues to come.  "There's a clear game to be played in macro over the next 12-18 months. The assumption is that we're still in an inflationary period and that we end up with an even bigger debt bubble," says one senior London headhunter. $6.7 trillion of US government debt needs to be financed next year, which is more than twice as much as in 2024. 

In banks specifically, headhunters say rates traders have lost ground in fixed income businesses. "Credit people got the upper hand in fixed income leadership teams and a lot of senior rates trading people have either been moved internally or gone to rival banks," says the headhunter. Bank of America's recent fixed income reshuffle was seen to favour credit traders over rates traders, for example. At BNP Paribas, Francisco Oliveira, the ebullient global head of macro and credit trading was displaced in September and Arne Groes, who has a pure credit background, has replaced him. Mark Tinworth, a top rates trader at UBS, was unexpectedly let go around the same time. 

Elsewhere, the list of rates movers is long and getting longer as the likes of Khan walk away. In recent weeks, they include the likes of Amarajit Matharu, an ED rates salesman who's gone from HSBC to Morgan Stanley and Moland Talouit, who just moved internally into a front end VP rates role at Citi. 

The big rates moves, however, happened earlier in the year. Barclays rehired Michael Lublinsky to run US macro trading in August. Carl Scott, Barclays' previous head of EMEA rates trading, left in March along with David Cross, the former head of European flow rates. Deutsche Bank hired Pedro Goldbaum from Citi. Gil Holmes, the global head of rates trading at JPMorgan quietly retired in July and was replaced by Matthew Franklins-Lyons, who moved internally. 

The shakeup has paved the way for an interesting 2025, when traders in new seats will be expected to prove themselves. It could also make for an interesting 2024 bonus round - with revenues down, rates bonuses are expected to be sparse, and established senior traders won't be there to argue the case for paying top talent for retention purposes. 

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