Margaret Mace has a favorite phrase, "Don't say, do."
The head trader at Pilgrim Baxter & Associates in Wayne, Penn., agrees that her style is straight out of the management principle enunciated in the U.S. Marine officers' motto – ductus exemplo – leadership by example.
Mace oversees a seven-person desk that trades equities, 80 percent in Nasdaq and 20 in percent listed issues. There are ten portfolio managers who are located a stone's throw from the firm's trading desk. Although the desk has relationships with about 50 broker dealers, it primarily deals with no more than 15.
Founded in 1982, Pilgrim Baxter has about $23 billion in assets under management. Its clients include pension and profit-sharing plans, charitable institutions, corporations, trusts, and estates. Pilgrim is also an investment advisor for about 15 mutual funds that are part of the PBHG family of funds, including several growth, value and sector funds.
Born in Baltimore, Md., Mace was raised in the town of Glen Mills, which is located in Delaware, Pa. Mace graduated with a degree in finance from Loyola College in Baltimore, Md., in 1986. While in college she interned in the public finance department at Butcher & Singer in Philadelphia.
"That's where I really got interested in what traders do and decided that's what I wanted to do," she said. "The action, the personalities, the noise, and the activity level was much more exciting than the public finance area." The world of stocks and bonds was not foreign territory to Mace. Her late father, Frank Mace, was a fixed income trader. Margaret Mace fondly recalled the many drives that she took with her father during their early morning commutes. "He would give his opinions," she said. "It was a good way to learn the viewpoints of the sellside."
Following her graduation from college, she joined the municipal bond trading department at the now defunct retail brokerage firm of W.H. Newbold's in Philadelphia. Three years later, she moved to Delaware Management, also in Philadelphia, as an equities trader. In 1994, Mace joined Pilgrim as one of its two traders.
Pilgrim has grown exponentially over the past six years. "Back [in 1994] we had two and a half billion dollars in assets and we have really grown over that time," Mace said. "We have really good performance because we are a growth shop and we are pretty aggressive."
Mace believes that decimalization will have a significant impact on the marketplace. "When you have price points that are six times as many as you have had in the past," she explained, "you are going to be taking more executions and experiencing more volatility because prices are going to be moving around [more]."
As far as Nasdaq's SuperMontage is concerned, Mace feels it will have only a limited affect on trading for the buyside. Although it is designed to increase the transparency of the marketplace, she said, in practice it may not achieve this goal.
Mace is proud of the close arrangement her trading desk has with the firm's portfolio managers and analysts. "When you are having a stressful day and the portfolio managers understand and respect the job the traders are doing, it makes every trader on the desk feel like a member of the investment department," she said.
What attracted Mace to the buyside is not only its relative stability, compared to the sellside, but to having the buck stop with her. "The [trading] decision ends with me," she said. "It's my responsibility to say yes' or no.' To take a bid or an offering."
When Mace wants to take a breather from the hectic trading desk she goes far, far away. Last year she spent two weeks in Ireland. Next month she is off to Italy for her second visit. "I love to go to Italy," she said. "I love visiting Rome, Venice, and Florence."
Unlike traders from her father's generation, said Mace, the current crop of traders must have a thorough grasp of trading technology. "In those days you could have a two hour lunch and not worry about the stock you are trading. The volume wasn't as large as today," she said.
Mace said things are constantly changing today. There is more to understand. "The ECNs, the upgrades to your order management system are some of the new areas," she said. However, Mace is not afraid of a challenge. And her colleagues can also rest assured that they have a team leader who leads by example.
