Ex-Morgan Stanley quant MD: Going it alone is 'scary'
When Pete Eggleston, the former head of the quant solutions and innovations (QSI) team at Morgan Stanley, put his hand up for redundancy in January, he knew that – after 20 years in the industry - he wanted to move out of a large financial institution.
But while it was tempting to move on to something new entirely, a career break in 2009 – working on wildlife conservation projects – showed him how different the pace of life could be outside of banking. “You come from an industry with very clever, driven people wanting to get something done and moving out of that environment is difficult,” he says.
Instead, together with Oliver Jerome – the head of FXEM Europe sales and trading at Morgan Stanley – he decided to launch BestX, a service that aims to give independent analysis into the cost and quality of FX transactions.
“There’s a huge demand from the market right now for independence. Regulations will require the unbundling of services, whether that’s research or best execution analytics, so I felt there was a potential market demand to be filled,” he says.
Despite the confidence on the long-term viability of the product, Eggleston admits that leaving a high-paying job in a large investment bank is a daunting prospect.
“At this stage, we have to deal with the fact that there will be no revenue generation for a few months, which is scary. The risk element is significant, but it’s the right time to give it a go,” he says.
It’s not just the job-security that’s a risk. Leaving the support network of a big institution for the solo life brings other problems.
“You realise how much infrastructure you had working for a large financial institution. If something goes wrong now, you have to fix it – whether it’s your PC breaking or the website going down,” he says.
Getting in by chance
Eggleston’s last role at Morgan Stanley was leading its highly-regarded QSI team within its FX analytics division. He was a managing director – something he describes as the “pinnacle of my career” – but never intended on going into banking in the first place.
“I had no grand plan with my career. I was studying PhD in Chemistry, which I had to give up because personal circumstances meant I had to earn money,” he says. “I tried to get a job in the sciences, but there were few opportunities. A headhunter called saying that banks needed scientists – they would teach us everything we needed to know about the markets.”
This was 1992. The role that Eggleston took was working in market risk for NatWest Markets. It's not the sort of start that usually results in a senior front office role further down the line. Nonetheless, Eggleston moved eight years later to become head of market risk management at ABN AMRO and then established a quant equity trading division for the bank.
A lot of quants aren’t known for their social savinness or client-facing skills and Eggleston admits the client aspect of his quant trading role was a scary prospect to begin with.
“It’s unusual for quants to go into client facing roles, but the bank needed someone to communicate complex ideas to clients and then relay those requirements back to the quant team,” he says. “It was nerve-wracking at first, but you quickly see that you make a tangible difference.”
At BestX, Eggleston says they may have plans to hire new people later in the year, but for now the focus is on securing clients.
And he hasn’t given up on the idea of leaving banking entirely – he’s a level II Triathlon coach, which is a passion he’d like to pursue. For now, he’s happy with the “flexibility” he has from not working for a large bank.