The milestones of a mortgage trader: Sales and Trading Club hosts first guest lecturer of the year
Kedrick Brown, WG'08
Issue date: 10/9/06 Section: News
- Page 1 of 1
On Wednesday October 4th, the Sales and Trading Club hosted their first guest lecturer of the school year. The club had the privilege of hosting Wharton MBA alumnus Mike De Asla (WG '99), a Director and Mortgage Trader at Merrill Lynch. Mr. De Asla generously shared his experiences trading mortgage derivatives through widely varying market conditions over about 7 years, on a top Wall Street trading desk. He spoke spontaneously for the entire session, colorfully expanding on his biography, and giving frank answers to insightful questions from Wharton students on topics ranging from compensation, to the computerization of trading, to career switching into sales and trading.
Mr. De Asla provided a wonderful role model for career switchers, as he was himself a career switcher. He obtained both a Bachelors (1991) and a Masters degree (1993) from MIT, and then spent several years working in the electronics division of Ford Motor Company prior to attending business school at Wharton. With his quantitative background and a strong interview showing, he was able to get a job as a Merrill Lynch summer associate in 1998, and subsequently began full time at Merrill in his MBA graduation year of 1999.
Among the most fascinating of the trading episodes he related was the steep learning curve he experienced when managing a trading book as a junior trader (when the senior trader was on an overseas vacation). During this time he encountered high volatility in the portfolio arising from an unusual confluence of market events, and was quizzed by management on the state of his portfolio. He communicated his thought processes and tenacity in this very stressful scenario very well to the audience, and then described how he was able to build on this experience to later perform well as a senior mortgage derivatives trader.
One of the most important points of Mr. De Asla's talk was that risk can have very unusual-and unexpected-manifestations. In the complex mortgage products he trades, the actual timing of mortgage pre-payments can quickly wreak havoc on apparently sound theoretical assumptions about them. On the other hand, even market relationships that may be taken for granted, such as a past relationship between mortgage products and treasury products that was used for pricing purposes, can change with the passage of time. Furthermore, broader market cycles can affect the success of nearly all traders in an asset class collectively. Nevertheless, risk management skills and tools are also improving, and Mr. De Asla made sure to mention how innovations like the advent of credit derivatives have made risks that were largely unmanageable before in the markets much more manageable today,
Overall, Sales and Trading Club members benefited from a very well rounded talk, and the unique opportunity to have their industry questions answered candidly by a Wall Street veteran. The club expresses its gratitude to Mr. De Asla for taking the time to visit Wharton.
The Sales and Trading Club will be hosting or helping to coordinate a variety of educational and professional events over the next few months, including club "office hours", days on the job at New York City investment banks and professional panels. Stay tuned!
Mr. De Asla provided a wonderful role model for career switchers, as he was himself a career switcher. He obtained both a Bachelors (1991) and a Masters degree (1993) from MIT, and then spent several years working in the electronics division of Ford Motor Company prior to attending business school at Wharton. With his quantitative background and a strong interview showing, he was able to get a job as a Merrill Lynch summer associate in 1998, and subsequently began full time at Merrill in his MBA graduation year of 1999.
Among the most fascinating of the trading episodes he related was the steep learning curve he experienced when managing a trading book as a junior trader (when the senior trader was on an overseas vacation). During this time he encountered high volatility in the portfolio arising from an unusual confluence of market events, and was quizzed by management on the state of his portfolio. He communicated his thought processes and tenacity in this very stressful scenario very well to the audience, and then described how he was able to build on this experience to later perform well as a senior mortgage derivatives trader.
One of the most important points of Mr. De Asla's talk was that risk can have very unusual-and unexpected-manifestations. In the complex mortgage products he trades, the actual timing of mortgage pre-payments can quickly wreak havoc on apparently sound theoretical assumptions about them. On the other hand, even market relationships that may be taken for granted, such as a past relationship between mortgage products and treasury products that was used for pricing purposes, can change with the passage of time. Furthermore, broader market cycles can affect the success of nearly all traders in an asset class collectively. Nevertheless, risk management skills and tools are also improving, and Mr. De Asla made sure to mention how innovations like the advent of credit derivatives have made risks that were largely unmanageable before in the markets much more manageable today,
Overall, Sales and Trading Club members benefited from a very well rounded talk, and the unique opportunity to have their industry questions answered candidly by a Wall Street veteran. The club expresses its gratitude to Mr. De Asla for taking the time to visit Wharton.
The Sales and Trading Club will be hosting or helping to coordinate a variety of educational and professional events over the next few months, including club "office hours", days on the job at New York City investment banks and professional panels. Stay tuned!
Be the first to comment on this story