Deutsche hires Blyth to run rates arbitrage unit

In the latest example of a growing industry trend, Deutsche Bank has set up a new proprietary trading unit, to be run by Stephen Blyth, which will specialise in interest rates' relative value and arbitrage. Europe is currently believed to be particularly fertile territory for such activity due to inefficiencies in markets for mortgages and liability hedging.

A well-known author of Risk technical articles on skew and correlation, Blyth joins Deutsche from Morgan Stanley, where he traded dollar interest rate options for the customer desk in New York. Before that he traded exotic options for HSBC, after working as a lecturer in mathematics at Imperial College, London.

In his new post, which is based in London, Blyth will report directly to Deutsche’s global head of over-the-counter derivatives, Michele Faissola. It is expected that Blyth will build up a small team of traders, initially from internal hires.