From Law to Trading Desk (Emma Baron, Executive Director at Goldman Sachs Asset Management)

Emma, absolutely thrilled to have you with us and super excited about this conversation. I know we met in a coffee shop a few weeks ago and it was just— I felt a bit guilty because I think I kept you far too longer than, uh, perhaps, um, was allowed. But so much stuff, uh, that we could cover, and I know we've gone back and forth. We've got it down to a few what I think will be really valuable things for lots of young people, but also women who are considering a a potential career in finance. But why don't we start at the very beginning of your story, which is probably similar to where a lot of the people listening are at the moment, which is in study. Love to get a bit about what you did, what you were thinking career-wise, and then a bit of a summary of your, your career to date. Because I know you've had— one of the most fascinating things about you as an individual, you've pretty much done a little bit of everything. And also you've done the kind of buy-side, sell-side thing the other way around than probably most people would think. So yeah, perhaps when you were a student and we can go from there.

Yeah, for sure. And thank you so much for having me on the podcast. Like really excited to be here. Um, so, uh, as we discussed, and as you know, I'm a complete accidental finance person. That's how I describe myself. Um, so I was studying up in Durham University and I read a law degree and, you know, in high school and at the time of doing that degree, I thought, you know, I'm going to pursue a career here in law, and I had been planning to stay on to do a master's. And then for one reason or another, they weren't able to support my research for an extra year, which kind of left me at an impasse of, oh God, like, well, what am I going to do? I've got a whole year to myself. I need to try and fill that with some kind of work experience. And, you know, at that time when you're sort of in that summer period, sort of post-graduation, pretty much everything for the immediacy is closed. So, I was sort of scrambling around and I was sort of very lucky that there was an informal program going on at BGC Partners, which is the prime broking arm of Cantor Fitzgerald. And full disclosure, I couldn't have told you what an inter-dealer broker was. I couldn't have told you what that involved. I knew what a trading floor was roughly. I, you know, sort of seen it on television, films, books, you get a vague idea of it, but I couldn't really have told you. What that entity was or what the day looked like there. I was lucky enough to be offered a 2-week rotation. I was very excited, so I took myself off to Churchill Place. I know we discussed in the coffee shop, I remember going up in the lift and I could hear this noise, just this noise, and I just thought, "Oh, there must be an event going on or something going on in the building." As I got closer and closer to the 19th floor, I realized, "Oh no, this is actually 'This is actually where I'm going to be for the next 2 weeks.' And that was my first steps onto the trading floor. So, I did a 2-week rotation there, totally abstract and different from anything I thought I would have been doing, you know, even just a few weeks before that, as to where I might end up. And that was sort of the start of it all, really. So, I sort of did my 2-week rotation BGC and around 4 different trading desks and got to know the brokers there. They're sort of explaining what they were doing, and it was sort of like a really interesting environment, you know, even not trading at that time, just watching. You sort of have this kind of visceral reaction to what's going on because there's just so much energy, so much noise in the room. And I just remember thinking like, 'This is really interesting. I really like this. I need to find a way back to this at the end of my 2 weeks.' So, I did my 2 weeks and then I was back on eFinancialCareers or some other sort of internship website scrolling and it just happened that this other placement popped up assisting one of the managing directors and it just said 'first year inter-dealer broker' and I thought, 'Great, I've worked at BGC. I know this business.' I'll give it a go and just by luck it was them again and then I was there for another 3 years. Initially adopted onto the base metals desk there and from that point on I guess I kind of gave up on the sort of law idea. My placement rolled around again for my master's, I turned it down and I stayed and that was the start of my career in finance. From there, I ended up making a really unconventional move, as you say, into the hedge fund world. This is not an atypical sort of— a typical progression that you sort of have in this space. Typically, you go buy-side to sell-side, not the other way, particularly not into being a broker to hedge fund. And, you know, as I said to you, the job that I was actually interviewing for, I didn't get. But they liked me enough that they kept interviewing me. I had no idea what job I was interviewing for by the end of it, and they sort of said, like, we don't really totally know what you're going to do, but we'd like to make you an offer. And I just, you know, Bluecrest, absolutely phenomenal institution, and I think there's something about a company sort of saying they like you as a person as opposed to sort of you've hit a certain amount of criteria. So I just had to go for it, and that was my start on the buy side. So I think really extreme sell side to really extreme buy side in one fell swoop. And from there I was doing a number of things, FX and swaps trading, a little bit of credit, working in the risk team also. So really dynamic role. And from the hedge fund space, I then transitioned into asset management, initially with Wellington Management, looking at emerging markets and high yield credit, and then fully settling into high yield now at GSAM, where I've been for, for nearly 3 years.

I'd just like to know a little bit more about what you're currently doing and all of that learning. Has it crystallized in the, the current company and role that you're in at the moment?

Yeah, so I think GSAM really has— in this role has really sort of been like a sort of really happy landing spot for me. So I'm in a seat now where I get to trade, I'm involved in portfolio management, all sort of levels of that, and get to work with a really sort of strong suite of portfolio managers around the world, which is phenomenal. And there's a real depth of experience across asset classes here. And I think what's been really nice for me here is like just the collaboration with some of those PMs and also the support of sort of, um, I think as an employee, the two things that you're looking for is growth and wanting to feel valued. And those two are probably the holy grail for keeping you in any job in any industry, really. And I think, you know, on a day-to-day level, working with someone like Robert Magnusson on your portfolios, helping him, he's been incredibly supportive and also just a very safe space for sometimes You want to ask what you feel is like the stupid question in the room, but sometimes you just need to ask a PM who's been doing it for sort of 20 years, who knows exactly, who's seen these sort of patterns before, and it's never a silly question, even though you're a little bit afraid to ask it. And then, you know, on a super senior level, one of our co-CIOs, Kai, in London, you know, he is sort of incredibly committed across the board to sort of like growth, growth, and also just sort of ensuring sort of like proper support and development across all the trading, but also particularly is really passionate about women in finance and those sort of events. So it's really nice when you have someone at a really senior partner level who's also championing, championing your progress, and also you feel you can approach because, you know, that's quite, uh, when you're dealing with someone who's sort of like really sort of senior management, it can be a little bit scary to go and knock on their door sometimes and sort of just ask a question about markets or ask for some advice. And I think And, you know, those two people just really stick out as people. If I never ever needed something or wanted to talk something through, you know, there would be always time and space for me to do that.

Wow, so, so many questions I have for you over that explanation. But I guess, you know, one of the main things was that I think a lot of people feel so much intimidation almost that they can't take action because of the lack of uncertainty of not knowing something. And you were saying there, pretty much on every twist and turn, it's completely different and completely new. I just wondered how, how, what are your tactics for adapting in that type of situation?

Yeah. I think one thing that I, if I can take away from all of this, and it's something I think about now, you know, when we help with the interview process here is that Nobody has any clue what they're doing on the first day, and anyone who tells you they expect you to walk in knowing exactly what you're doing or how things work is just— I mean, they're just sort of lying. When you're starting out in a beginner role, that's just not a thing. One of the most important characteristics I think that people look for in an individual is someone they can work with. Realistically, we sit next to our colleagues for sort of 12, 13 hours a day, at least in finance, probably maybe longer when you're starting out. You spend more time with your colleagues than you do with your family. You're looking for someone with a work ethic, someone with a drive, someone who's going to be a self-starter. Everything else you can learn. And it's really hard to not kind of do that sort of place of fear, "Oh God, I don't know this, I shouldn't apply, I shouldn't go for it" thing, and actually just push yourself forward. But actually, I think if you present in a way that's really constructive You shouldn't see a lack of knowledge as holding you back because probably you have the intrinsic skills to do the job. It's just that you need the repetition, you need the exposure, and you need to sort of settle into it.

Yeah. And on that point then, you said, you know, often, probably now you get involved to some degree or at least have an interaction with more junior members. You know, I guess a lot of people listening will be thinking, okay, so what are some core fundamental skills that I can showcase then? In order to convey, like, as you described, that someone's going to want to put in the effort into me or see that I could be taught and therefore have potential to be a really good performer long term?

Yeah, so I think, I think, I think work ethic is, is number one. And that doesn't mean that you're working 15 to 20 hours a day. I mean, I mean, you're working efficiently and effectively. And, uh, I think the self-starter piece is hugely important, particularly when you're starting, you're joining a team, everyone's busy, everyone's got other priorities. Priorities and things that they're trying to juggle as well as teaching you. If you can take a little time, even if it's a case of you're in a meeting, say, for example, you don't necessarily understand everything that everyone said, write it all down, research it, find out what it is, rather than sitting there and going through 40 points and saying, "Can you explain each one of these to me line by line?" Get a base sort of sense of what was going on, ask informative questions, and I think that really sort of brings people in and that warms people to you because you've tried to do some of the work yourself, you've shown some initiative and forward, of like you are actively trying to teach yourself and progress there. It's not just you sort of sat there and done nothing. I think that's like a real point of differentiation where someone has actively gone out and tried to teach themselves something or learn something as a starting point and then come to you and said, "Hey, I kind of get this bit, but these next steps I'm not 100% so sure." I think that's a really good sort of stepping way forward going into it.

Cool. And given the changes that you've made, uh, I guess this is something that comes up in your early career because sometimes you, you take that first role cuz it's an, the opportunity presents itself. Is there like a, a, a balancing act though between having the confidence to go, okay, maybe this isn't right for me and actually I need, I feel like I need to change up. How do you go through that process? A, to identify I'm not being completely fulfilled, B, seeking out what's the alternatives. Like, you've done this a couple times in quite dramatic changes. What was the process there? Like, how did, how did that work out?

So I think when you're first starting out, you— at least in my case, I had no idea which market I was going to have a natural affinity for. But there are some things that you intuitively know about yourself, for example. So if I described myself as a person, particularly 21-year-old Emma fresh out of university, I was relatively quiet, relatively shy, relatively introverted. It is not a natural thing for that version of Emma to have wanted to go around cold-calling a bunch of people trying to drum up trading business. I wouldn't have said my personality at that time lent itself to a sales role. I didn't really need to have to go through a sales role to tell you that maybe I wouldn't have felt super comfortable doing that job. I kind of knew that about myself as it was. What I did know was that I liked being proactive, I liked making decisions, I liked analysis. I think so when I came into a buy-side seat and we're working on portfolios, we're making those active trading decisions, we're making risk calls, that sort of process and analysis was a lot more in tune to the skills that I had in my degree and naturally the things that made my, my brain tick. So I think that was like a really informative piece for me of like, hey, this is the side of the road that I need to be on. I'm not a natural sort of sell-side person. And then I think in terms of the asset classes, that was a little bit trial and error. I think after a while you get more and more exposed to markets and you start to trade a bunch of different products and you start to get to feel— get a feel for them. And, you know, there's a huge difference between social size in G10, G20 rates and social size in emerging market rates and nuances in how things trade there. And I think one of the things that I like from base metals, one of the things that I liked from trading EM, one of the things I like from trading credit is the tangibility it's you're inherently just dealing with people and what people on a macro and micro level are doing. It's very, very tangible to me. And I like the opaqueness. I like the relationship-driven nature of the dealing there. And I like that it's a little bit illiquid. That sort of challenge to the execution I also really enjoyed versus some of the more liquid products. So I think as I've tried different things, as I came up through my career, sort of BGC, you know, I kind of knew I liked best base metals. I like, I liked, I like, I like that sort of style of product, idiosyncratic product, you know, those sort of traits I sort of found in all my asset classes. And now in sort of lev-fin high yield, this is like the happy, happy seat for me. Um, you know, I absolutely love my asset class.

Yeah, it's really refreshing to hear actually, because a lot of the interactions I have with students thinking about their career, they're always thinking, right, what I do next is going to define me for an entire 40-year career sort of thing. But what you're saying is that actually two parts. One, if you possess the right hunger and motivation and consistency and curiosity to learn, and then put that in with putting yourself into new environments to see whether or not it works, then you, you can kind of find your way like that. It doesn't have to be perfect day one. So I think that's a really good message.

I would 100% agree with that. Yeah.

Cool. Well, there's a couple other things here that I do distinctly remember you mentioning that I thought particularly interesting when we first met. Uh, and one was by nature probably of having worked, as you described, kind of picking up the phone, selling, trying to facilitate, generate trades, things like that, to then being on the other side where probably they're calling you and you're having to pick and choose, or, uh, and the relationship's quite different. You mentioned the kind of idea of empathy, and I think empathy is a really interesting concept in the sense of, um, trying to get the best working relationships and outcomes for what you need as a trader or an asset manager or a broker, and about how it's important to be considerate towards others. So I wonder whether you could kind of explain your, your take on that.

Yeah, so I think there's a couple things as part to that. You know, I said this is a sort of a people business as a trading asset class. It's also inherently just trading is just a people business, full stop. You know, regardless of how electronic your product is, you have to have some kind of relationship with the person on the other end of the screen. You know, and people generally, any employed person is tired, sometimes grumpy, has other life stresses going on. Sometimes, rightly or wrongly, you can just be the person who gets caught in the crossfire of those sort of things. So I think, you know, one thing that I sort of tried to pick up was not to internalize it. A lot of the time, that's, that's not personal. In terms of actual trading now, I think there's two parts to this. One thing, the way you conduct yourself in the market is an inherent extension of the brand and the product and the company that you work for. You always want to be perceived, I think, as being constructive, reliable, and trustworthy, and that's the best way that you should be representing whichever company it is that you trade for. You should be striving, you know, you're always striving for best execution, but you should be striving also to be one of the best counterparties on the street. And I think particularly when you're, you know, I found through Lev Finn trading trading less liquid products, you know, that trust element is hugely important. As much as the Street is there to facilitate flow and work with us on that side, they don't have to trade with me. There are other buy-side institutions, right? And the same way that I don't have to trade with certain counterparties on the Street, but they should want to trade with us. The relationship should be constructive. I think there's so many caricatures of what trading is, and quite often it's people screaming at each other. There's lots of expletives and lots of shouting, and you don't need to shout to be firm, and it doesn't necessarily guarantee best execution. So I think, uh, for us it's— and well, for me, it's, it's just not a zero-sum game. These are long-term relationships. The way you get best execution isn't— isn't a whole— as a whole period of career it's not on one trade. So I think a little bit of courtesy, collaboration, respect on the street, I think it goes a very long way.

One of the things you mentioned there was about, you know, kind of, let's say, critical feedback that you might get, particularly, I guess, early in your career. Do you think you have changed your approach? Do you think no one can really learn that until they're in that environment? And I imagine your first experience being on a broking floor was a pretty good introduction to that type of situation. So yeah, just to get a bit of a feel for that, do you think you've evolved and that adapts, but you have to really have those experiences, they're really pivotal to be able to grow from them?

100%, 100%. Like, I have never seen a working environment sort of like that, and you know, those kind of big broking floors are a totally different beast. To, you know, what you would experience in an asset manager or even in a hedge fund, just on the volume basis, right? If you think about how deals might be constructed, and you know as much as I do from your career, it's just very different when people stand up and you're physically shouting a price over a desk. So everything that is happening, whether that's a discussion about lunch or some critical feedback, tends to happen at a slightly elevated volume sometimes, and it comes immediately. I'll be totally honest, it was shock of capture for me. It was initially like, I was like, oh, oh gosh, that's a different way of sort of communicating things than I was sort of expecting. What was, I'll be honest, like sometimes can be initially jarring, I think that comes back to the empathy point of when there is a huge amount of pressure, which there is, to be clear, in any trading seats, It is a job that requires basically 100% or complete perfection most of the time, so you don't make mistakes. When things go wrong, people will get angry or they may be slightly upset, and sometimes that doesn't come out in the right way. It is really hard not to internalise it, as I said initially, but you sort of come to a point of, okay, if you can recognise the stress and the pressure that everyone is under, you realize that actually it's not about you, and that is the feedback that anybody who was in that situation would have, would have also received. It's not personal, it's just a matter of that moment in time and how you were receiving it. I think the older I've gotten, not to say you develop any kind of immunity, for it, but you just sort of take it for what it is. It's not the be-all and end-all. Doesn't mean you're getting fired. It doesn't mean that the person doesn't like you, and it doesn't mean that you're bad at your job. And I think that's the most fundamental thing. When you're, when you're really young, you assume like, oh God, I must be terrible at my job if this is happening to me. Doesn't mean that. You're not getting fired. Like, you're fine. You're fine. I think just got to try and grin and bear it and, you know, I'm gonna sound like a broken record, but genuinely don't let it deter you.

Okay, I feel like people might be getting a bit of a visual image of what the broking floor looks like, but I remember distinctly you were telling me that actually, you know, you can just envisage this young woman coming on the floor where there's not many other women and there's lots of big burly men shouting, but you told me that actually that was probably— they were some of the nicest people you met and they were some of your biggest kind of advocates.

Yeah, yeah, so what was initially sort of like a deer-in-the-headlights moment when you walk onto this huge open plan trading floor, hundreds of brokers, I think what I experienced, at least anyway, was actually quite paternalistic. You know, my boss at the time, Brad Marchant, really took me under his wing. He was incredibly incredibly supportive, incredibly supportive of me, and I think that was really, really formative. And this was something that we sort of spoken about, I think, like there's been a bunch of pivotal, pivotal even, men who I've encountered on the PM side, on the trading side, sort of as I've progressed through my career. I mean, I mean, Brad initially, because I was so much younger, and he was almost slightly paternalistic, which is actually, you know, really, really lovely. And I think when you have someone like that who's advocating for you, who will stand up for you, who actively wants to see you do well, I think it took so much of the pressure off because it didn't matter at that point what anyone else thought. At that point, I was working really hard, my boss was happy with what I was doing, my boss wanted to see me do well, and and that's ultimately all that mattered. Everything else was noise. Everything else on the floor was noise, literally and metaphorically. It was just noise.

And then one other thing I was going to ask is about, uh, I also remember you saying about sports was a key feature in your, your childhood, and I wonder if you could just explain how that transfers into, or has done, into your career.

Yeah, so I think always sort of playing sport as I was growing up, you kind of build up with this team mentality. There's a competitive edge there, but it's not competitive versus each other, it's competitive towards a common goal. And you inherently want everybody else on your team to do well. And I think, I think that's really important because trading, you'll be on a desk, portfolio management, you were part of a broader team. It's not an individual sport, it's a group event. It's very, very much a group event, and I think as an employee or as a teammate, I always try and support the wins of everyone because a win for one is a win for the entire team. That's sort of how I see it, and I think that's how you create a really supportive, constructive working environment, because everybody feels like you've got their back, and that's how you get the best out of a desk, and that's how you're able, I think, to you get through a big workflow, because sometimes you're here for a very, very long day, it's really stressful, you're trying to do 9,000 things at once, and having someone or a number of people who you can totally rely on, who can say, hey, you need help on this, hey, you need me to jump in on this, it really sort of helps your mentality, because otherwise things can get really, really overwhelming. So I think that sporting sort of background that teamwork background has really helped me. You know, we work as a group, we're outwardly competitive, we want to do well, we want to have great performance, we want to trade really well. But if someone does a fantastic trade on another desk, I think that's brilliant. You know, I, I want to see my colleagues succeed as much as I want to succeed myself.

Yeah, you've kind of semi-answered my next question, was how do you, how do you decompress when you do work long hours and there is high pressure. Like, are you still trying to figure that out in terms of what works best for you, or is it something that you now, you feel like you've got a good process in place to be able to, be able to be an elite performer in your job professionally but also manage a, a personal life at the same time?

Well, that's a, that's like the million-dollar question. I think my hobbies have definitely gotten more abstract as I got, I've gotten older. Like more, more sort of crazy and away from anything to do with my day-to-day life. I think having a route and escape is really important.

You can't say that and not tell me what these are now.

I mean, I mean, I said 5 years ago I started training circus arts, which even by my standard was like nothing to do with— I mean, I have no business learning how to do trapeze or anything like that, but it hasn't stopped me. I really like climbing. I like running, but that's a little bit more boring, it's slightly more conventional. I like to learn languages. Things that are totally distinct and have absolutely nothing to do with my day job really help me to unwind. I think as I've gotten older as well, and as you get more experience in your seat and your job and just generally what your day needs to look like, you become a lot more effective at working. And that's not that your day necessarily shortens hugely or sort of dramatically, but instinctively I just know, okay, I need to get this ready for a portfolio tomorrow. I need to do this by this time. This is, this is the order that I need to work in. And I think when you kind of have that structure in place, and that just comes with time and just experience as to how you need to do things, I think you then are better able to manage what your evening and what your personal life looks like. I mean, when I was young and you were hungry, you just want to learn everything and you just want to be there till like 10 PM because, you know what I mean, you're just trying to absorb everything and put your best foot forward. I mean, there is a point where you're not being productive anymore. You're so tired, you're not focused, you're just sort of reading the same paragraph over and over again. Knowing when to stop, take a breath, recharge, come back, try again, I think, I think is really important.

And a final question, if I may, which is something I'll ask everyone that I have as a guest, which is when you think back in retrospect to, like you said, Emma coming out of uni, first day of work, what advice would you give her to kind of counteract some of the nervousness about that moment or the future career ahead of her?

I think probably two things. One, and I'm really bad at this, be kind to yourself. And I think particularly when you're younger, you kind of assume that things are supposed to happen with a regularity. I was really hard on myself. I'm still quite hard on myself, to be honest. You sort of think, oh, I should be a little bit further ahead, I should be trading this now, I should have made more money, you know, you sort of dissect everything you're doing, and the reality is you're just making the best decisions and working as hard as you can at the time. So I think, first and foremost, I would tell myself to be kind to myself, and secondly, on that piece, I would say like things aren't linear, and I think that's what I've definitely learned with my career. You would think like I've swapped different asset classes, but if I hadn't done that, I wouldn't have found an asset class that I absolutely love and a seat that I love. It doesn't matter that I've not been in one place on a steady sort of grind up. Sometimes you do need to find the space to the side so you have space to grow. I would say don't worry about not having that promotion in 6 months' time or not necessarily getting something. Progress comes and goes, and things, things, things are not linear at all.

That's brilliant, and I can't wait for young people to hear that. It's a really powerful message, I think, particularly for the large majority, which, you know, it's not absolutely clear, and it's okay to find your way. So Emma, absolutely thrilled to have you on the series. I know we're recording this late on a Friday at the end of your week. So I can't say how much I'm thankful for you giving up some time, but thank you very much.

Thank you so much for having me.