Three members of Bank of America Securities' equity derivatives trading team in New York, along with the business manager of the trading group and two risk management system professionals, departed the firm Tuesday morning to launch a hedge fund.
Jonathan Sandelman, managing director and global head of equity financial products in New York, confirmed the group had left. He said the departure was prompted by the traders' desire to venture into proprietary trading, a move that was not open to them at BofA. "Our capital wasn't available" for that, Sandelman said. He added that the firm already has proprietary traders and positions were not open.
The group consists of, John Illuzzi, head of customer vol arbitrage trading, and his traders Andrew Mitchell and Nathaniel Newlin. Van Nguyen, the business manager of the equity derivatives trading group, Venk Reddy, a risk management systems technology professional, and Tim Walton, another risk systems pro, also left.
"This is not exactly devastating. This will give us an opportunity to go into the marketplace and look around for new people. We're excited about surveying the talent," Sandelman said. Market officials said the hedge fund, which the group plans to launch, is likely to focus on proprietary arbitrage strategies.
