On Sept. 5, Molly Concannon and Ben Rost of The Vanguard Group hosted “A Day in the Life of a Buy Side Trader.” The event was the first pop-up workshop of the new school year, a series of programs designed to inform Notre Dame students of the different career paths within the finance industry. Concannon and Rost both focused the discussion around their work with fixed income trading, how Vanguard’s core purpose—‘to take a stand for all investors, to treat them fairly, and to give them the best chance for investment success’—ties in directly to their work, and provided a glimpse into marketing this approach with institutional clients.
Molly Concannon is a buy-side trader at The Vanguard Group (Vanguard). She began working for the investment company through a summer internship program while she was a student at Notre Dame. Upon earning her BBA from the University in 2010 in Finance, Concannon accepted a full-time position at Vanguard, where she worked in a variety of roles, including the Corporate Strategy Department and Corporate Finance. She also worked as a trader on Vanguard’s index, derivatives, and FX desks. She left the firm briefly to earn her MBA from the London Business School before returning to Vanguard as a fixed income trader which is the position she holds today.
Ben Rost is the Defined Contribution Advisory Services Methodology Lead, where he collaborates with a team of investment strategists to deliver insights to over 500 401(k) plan sponsors each year. Previously, he was a senior manager in Vanguard Portfolio Review Department, where he led product management for Vanguard's bond index funds and ETFs, and product development for Vanguard’s mutual funds. Mr. Rost joined Vanguard in 2004 and has held a variety of financial sales and client service roles. He served as an investment analyst in Vanguard Portfolio Review Department and a project manager in Vanguard Corporate Strategy Group. Before Vanguard, he was a commissioned officer in the U.S. Army. Mr. Rost earned his B.A. from the University of Notre Dame and his M.B.A. from Villanova University.
Founded in 1975, Vanguard is an asset management firm headquartered in Valley Forge, Pennsylvania. With over 5 trillion dollars in assets and 20 million clients across the globe, it is one of the largest investment companies in the world. Vanguard manages accounts for individual investors as well as institutional and financial advisors, always with the intent of keeping costs low, providing best-in-class client experience, and delivering top-notch investment returns.
Buy-Side Trader v.s. Sell-Side Trader
A fixed income trader trades investments like, public company debts, tax exempt municipal bonds, and/or government debt.
A buy-side trader, like Concannon, works on behalf of her clients, individuals and institutions that are invested in Vanguard’s mutual funds or ETFs, to identify investment opportunities she and her team believes will outperform the funds’ benchmark. They do this, by assessing the credit-worthiness of different companies and ultimately deciding to whom they should lend money (i.e., buy a bond).
This is opposed to the sell-side traders, who manage the creation, promotion, and selling of traded securities to the public. Sell-side traders serve as client advisors through pitching stocks and opportunities that may be enticing to their investors. The products that they produce are then made available to the buy-side traders.
A Typical Day for a Buy-Side Trader
Concannon’s daily routine begins when she arrives at work as she immediately begins reviewing what happened in the market overnight. Through collaboration with the sell-side traders, a cohort that she regards as “critical partners of [buy-side traders],” Concannon can quickly assess any new information and start working to see what new deals will be initiated, focusing on her end goal of making the best buy recommendation.
A major part of the investment process is communicating with risk management, which in turn allows her to charge less in fees while still maintaining high returns. The post-trade process includes performance analysis and a team recap which highlights the collaborative nature of the department. According to Concannon, buy-side trading at Vanguard is “Very interactive--every single day is different and you are always learning something.”
The Buy-Side Trading Environment
In addition to the interactive nature, Concannon also appreciates the autonomy that comes with being a buy-side trader. Traders are empowered to make impactful decisions for Vanguard’s fixed income funds. She recognizes the gravity of this capacity highlighting, “Managing others’ money is a great honor and great responsibility.”
With only 18 months of experience as a buy-side trader, Concannon does not claim to be an expert quite yet. Always looking to expand her skill set, she values not only the opportunity to learn from her colleagues at Vanguard but also the level of teamwork that is encouraged in the office. She incorporated this in her advice to the event attendees saying, “Find a company where everyone loves what they’re doing. This will make the culture that much stronger and will make them that much more excited to teach you.”