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The Derivative Strategy & Execution team is accountable for execution and management services for the derivatives portfolio of the Canadian Portfolio Management Group, Canadian ALM and the Global Variable Annuity Hedging Programs. Effectively designed hedging programs are critical to Manulife’s ability to continue to grow its business in the future, while maintaining an appropriate risk profile.
Wealth management products offering investments in equity markets with principal and other guarantees are a fast-growing business at Manulife. Offering guarantees related to investment returns and longevity within our wealth management products is considered critical to the continued vitality of this business. These guarantees create significant exposure to equity market returns and interest rate movements, both of which are among the most significant risk exposures for the Company. Industry best practice entails a dynamic hedging program to mitigate these risk exposures. An effectively designed and operating dynamic hedging program is key to Manulife’s ability to continue to grow this business in the future while maintaining an appropriate risk profile.
The Variable Annuity Hedging team is accountable for the management of the derivatives book with the objective of maintaining a hedge position against our variable annuity investment return exposure. The sole mandate of the VA Hedging desk to maintain a hedge position. It does not trade for profit. The Junior Derivatives Trader and Analyst is responsible for monitoring various hedge program exposures and for executing derivatives trades when exposures reach predetermined levels. The Junior Derivatives Trader and Analyst is also responsible for executing derivative transactions for the Canadian Portfolio Management Desk and the Asset and Liability Management (ALM) Group as required.
- Continuous monitoring of the dynamic risk exposure of the Variable Hedging programs. Execution of futures and OTC interest rate swap trades when the exposure exceeds predetermined levels.
- Become cross trained in the production roles within the hedging unit including the administration of the Intraday Risk Management System (IDRMS) and hedge program reporting processes used by VA Hedging management to monitor asset/liability exposures.
- Assist and Execute trades for Portfolio Managers in Canada. Reverse engineer investment dealers’ proposals and provide analysis of fair value pricing. Provide Portfolio Managers with indicative pricings of derivatives. Assist and negotiate with counterparties on prices.
- Develop Ad Hoc analysis and reports as required by both the VA Hedge management team (e.g. futures roll costs) and Investments.
- Monitor markets to determine the impact of market activities and economic releases on trade execution. Manage relationship with counterparties to determine where and how best pricing can be obtained, and how trades can be executed with minimal disturbance to the market.
- Provide maintenance on derivative trade inventory. Such activities include trade amendments, liquidations and restructurings that require changes to trade parameters and negotiations with the counterparties.
- Model work to support decision making on Canada and US Portfolio Management Teams.
- Degree in a quantitative discipline e.g. engineering, math, science or economics / finance.
- Successful completion of CFA.
- 2-5 years of experience in a trading/execution capacity. Derivative execution experience is highly desirable.
- Advanced Excel and experience in programming with VB or Matlab.
- Demonstrated ability to thinking strategically by identifying potential or evolving issues, proactively developing solutions, questioning and continuously improving current practices, and setting clear goals and priorities in the face of competing demands.
- Ability to combine qualitative business judgement with quantitative analysis / modeling.
- Position requires strong modeling skills with an appreciation/understanding of model limitations.
- Candidate must exhibit strong interpersonal and communication skills to build and maintain relationships and partnerships across the organization and with external dealers / counterparties.