Crop Traders in High Demand at Hedge Funds Looking to Cash In on Commodities
Hedge funds and proprietary trading firms are beefing up agricultural markets expertise by hiring traders as big swings in prices have made even relatively niche corners of commodities trading lucrative during the past year.
Prominent moves include Squarepoint Capital LLP’s January hire of Olivier Paturaud from Louis Dreyfus Co., where he headed sugar trading in Asia, and Millennium Management’s hiring of soft commodities specialist Jonathan Kroft from Citadel late last year, according to people familiar with the changes. Marshall Wace brought on Neil Smaldon, who has an agriculture background, as the firm’s head of discretionary commodities.
Hedge funds have made a major comeback into commodities trading during the past year, with new entrants emerging as existing heavyweights made a series of hires to bolster their teams. Attracting and retaining the right talent has been a huge area of focus, with hedge funds offering massive signing bonuses to bring on expertise.
“It is evident that the pool of agriculture and softs traders is lighter versus energy, therefore hedge funds are having to be more competitive to attract the top traders,” said Ross Gregory, senior partner at executive search firm Proco Commodities.
Many of the hedge funds with strong energy trading operations are now looking to diversify into agriculture and softs commodities to maximize returns across a broader asset class, Gregory said. Demand from firms for agriculture, softs and metals traders is 65% higher than energy search mandates since the start of the year, he said.
Squarepoint still has at least two open positions — one commodity fundamentals trader and one commodity fundamentals analyst — on its website. The company didn’t respond to requests for comment. Millennium declined to comment.