Antoine de Saint Vaulry 
Head of ETF & Flow Trading Asia @ Commerzbank AG

“Moving from the Securities Finance to the ETF universe was a no-brainer, really.”

JE: Please tell us about yourself, your studies and your experience.
Antoine: My Name is Antoine de Saint Vaulry. I’m 39, from France, married and father of 4. I’ve been living in HK for the past 6 years, following 6 years in England.

I’ve studied Business and Management in France at ESSEC Business School, then joined Societe Generale in Paris on the Securities Finance desk. In 2004 I quit SocGen after 3 years to join Commerzbank’s Securities Finance team in London. In 2010, I got sent to Hong Kong to head up the Delta One team in Asia, and in 2012, I received the green light to create and develop the ETF Market Making platform for Commerzbank in Asia.

Since then, we’ve become a recognized leader, interacting with issuers, exchanges, regulators, investors all around Asia, to try and improve the liquidity of the ETF market for Asian investors.

JE: What was your first job in the ETF industry and why did you decide to pursue the career you have today? What was the pivotal moment?
Antoine: This is still my first and only job in the ETF industry.

Moving from the Securities Finance to the ETF universe was a no-brainer, really. ETF was an established market in the US, booming in Europe, and still nascent in Asia. Moreover, our research showed the need for a dedicated and committed liquidity provider in the region. Our development was therefore pretty natural.

On a personal note, in a world of regulation, balance sheet pressure, RWA constraints,… I was glad to move to a pure “cash” business, with no real counterparty credit exposure, very limited balance sheet requirement, etc. Moreover, Commerzbank was already a major player in Europe on the ETF market making, so the business was already recognized internally and externally… Perfect move for me.

JE: What are the things you work on, what are some of the challenges that you face in your role and what do you enjoy the most?
Antoine: The challenges are stemming from the extent of our endeavor: Our aim is to help bring liquidity on ETFs all around Asia. Therefore, we are ever trying to expand our coverage (covering more ETFs, more exchanges, more clients,…). The main challenges are linked to the fragmented market ecosystem in Asia. You basically have to start from scratch for each new market. A significant part of our efforts is spent talking to regulators, clearing houses and exchanges to try to simplify and rationalize the trading ecosystem. Besides, ETFs are still not fully understood or used by investors in Asia, so education is still a key focus.

What do I enjoy the most: we’re building something lasting and solid, a real platform, and we are working daily on our processes and capabilities, to improve, fine-tune and optimize. I find it exhilarating.

On another note, as a market maker, it’s one of these rare jobs in finance, where you are actually bringing something to the market. Issuers like you because you make their products tradable, Exchanges like you because you generate more turnover, investors like you because you improve the prices they trade at. It’s a win-win-win-win situation. Not a lot of those in the financial markets today.

JE: Was there a time throughout your career when you were unsure about where you were going? How did you combat the uncertainties?
Antoine: It’s a long-term plan, so not everything is paying off right away. I’m a pretty patient man, though, and we have a fairly good view on where we want to go and how to get there.

JE: What has been the highlight of your career?
Antoine: We’ve received numerous accolades (Best ETF MM Asia, ETF House of the year Asia,…) from various publications, which is always very nice. But the highlight of my career was probably when we passed the symbolic 100 ETFs bar as Official Market Maker on the HKEx. This is a symbolic figure, but that was our goal when we started up, we are based in HK, so building up the platform to reach this milestone was something important for us.

JE: Are you a member of any professional association?
Antoine: No membership to any professional association yet.

JE: What is the best bit of advice you’ve received in your career? And what advice would you give to those who are just starting in the industry?
Antoine: You won’t get many opportunities, so be sure to make the most of all of those that come round. Work hard, learn, explore, meet people.

JE: What key skills you think are necessary to have in order to be successful in the industry?
Antoine: Hard working and reliable (for your current job) with a good sense of contact (for the next one).

JE: Commerzbank recently received the “ETF House of the Year” award at the Structured Products Asia Awards 2016. What is Commerzbank’s USP and your overall strategy in terms of ETFs?
Antoine: ETF is one of the main trends of the 21st century, and Commerzbank is very well positioned to accompany this development. Amongst others:
As an issuer: Commerzbank’s own brand of ETFs, Comstage, has recently launched its first 2 products in Hong Kong, on top of their 115 ETFs listed in Europe.

As a market maker (which is my focus): Commerzbank is a leader in ETF Market Making in Europe and Asia. We offer liquidity on screen or OTC on more than 3000 products, all throughout the day. I would say our USP is our dedication and commitment to providing liquidity. We are one of the very few houses to have a fully dedicated team focusing solely on ETF market making.

JE: What would you do if you were entering the industry today? Would you do anything differently?
Antoine: I don’t think I could do things very differently. As a company or as a person, you have to grow into your role and find your place in the ecosystem.

JE: If you had a magic wand, what one thing would you change in the ETF industry?
Antoine: I would simplify and standardize the trading ecosystem (creation/redemption cut off times and processes, settlement rules, settlement systems,…) to make trading ETFs as painless and easy as possible for everybody.

JE: Finally, let’s talk predictions. What trends do you think are going to define the next few years in the ETF industry?
Antoine: As most of the rest of the world, I am pretty bullish on the ETF market, so I expect more AUM, more products,… in the next few years. In particular, I expect more diversity in the underlyings of the ETF listed, both in terms of strategies (smart beta strategies, active management,…) and in terms of asset class (currencies, commodities, alternative asset classes,…).

On the other hand, I think we might see a concentration in the issuer’s space, to better tackle the development costs of an ETF range.

Likewise, I think some exchanges will differentiate themselves on the ETF front. Some exchanges are proactively making efforts to facilitate the listing and trading of ETFs, and this will pay.