Wallace reappeared at the desk and slumped down in a spare seat.
‘All right, Jencks, if you haven’t managed to destroy all your grey cells drinking with unsavoury characters, what’ll it be this week?’ He gave Helen a look half teasing, half admiring. They’d had a bond right from the first. He’d expected to resent the woman foisted upon him when she first arrived on his patch four years ago. No qualifications, no background, just a hardy, streetwise look, an incredible curiosity to learn, and the raw intellect to process what she hoovered up. Her abilities overcame his reservations. What forged the bond was his immediate sense that this was another dysfunctional soul. He could see the shards of pain piercing her skin, could sense the yearning loneliness in her, and he knew that she could see in him his dislocation, his inability to form relationships with anything other than a computer. Until she came along, offering friendship.
Only one thing marred it. He always had the sense that it was just a matter of time until he imploded, until he was destroyed in some way by his own infirmities, while Helen, for all her weaknesses, had about her the grit of the survivor. It was as if he knew that somehow, in the game of life, she would beat him, betray this friendship of what should have been equals. Helen was smiling back at him, seemingly oblivious of the slow corrosion in his mind.
‘I don’t like the look of things in the Gulf,’ she said enthusiastically. ‘I think the markets are bored with Iraq, think it’s just gonna be a side show, but I reckon they’ll need something to scare themselves with soon. When that happens, volatility’ll increase, oil’ll rise, gold’ll fall. I’ll give them a few months to brew it up. I wanna buy three-month calls on Brent crude, buy three-month puts on gold.’
She turned to Keith. ‘Put and call options give the purchaser — me in this case — the right, but not the obligation, to sell and buy an index or a commodity at a set level, called the strike price, over a given period of time. If I get the markets right, in three months I’ll be able to buy oil at a price below the prevailing market price, on sell immediately and make a profit, or just sell the call option in the options market. It’ll rise with the price of oil, and I’ll make a tidy profit.’
‘That’ll be nice,’ interrupted Rankin. Helen gave him an indulgent look. She’d made over three million dollars so far this year. Rankin was two million down.
She turned back to Keith. ‘If I guess gold right, I’ll be able to put, or sell, my gold at my pre-set price which would be above the prevailing market price. I can do this if I choose, and buy the requisite quantity of gold to deliver, and pocket the difference. Or, more simply, I’ll just sell my put, which will have risen in value with the fall in the gold price, and take the profit on that.’
Wallace started to drum his fingers. ‘If you’ve finished, Professor Jencks.
‘I haven’t, so back off. Now, if I guessed wrong and the markets moved against me, I wouldn’t want to exercise my call and put. For example, say the price of oil falls, I wouldn’t want to exercise my option and buy it at the strike price when I can buy it more cheaply in the cash market today. Make sense?’
Keith pulled a tortured face. ‘Yeah. Er, think so.’
‘Don’t worry. It’ll come in time. So anyway, that’s the whole joy of options. Flexibility. I can exercise if I choose, but I’m under no obligation to do so. Now, the cost to me of buying options would be the initial purchase price of the call and of the put. We call it the "premium". Premium is determined by, among other things, the volatility of the underlying commodity or index. There’s a whole load of incredibly sophisticated valuation models, all derived from something called the Black Scholes option pricing model, developed by three serious rocket scientists in the early seventies. Hugh’ll explain it to you, won’t you?’
‘Not bloody likely.’ Wallace ran his fingers underneath his collar and gave it a vicious yank.
‘By the way, it’s shepherd’s pie tonight.’
‘If I have time,’ muttered Wallace.
‘Good.’ Helen turned back to Keith. ‘The price normally works out at only a small fraction of the value of the ultimate underlying trade. I can buy the right to buy one hundred million dollars of oil in three months’ time for an initial outlay of six million.’
‘Yeah. Big wow. It’s called gearing. For only a few mill, I can take massive exposure, massive risks.’
‘And make a ton,’ said Rankin.
‘Or blow my premium,’ added Helen. ‘In this case, I’m long options, but if I’m short, that is if I sell options to counterparties, and have to deliver the underlying, and I read the markets wrong, I lose my shirt. The floor’s littered with the corpses of traders who’ve crashed and burned in the options market.’
‘You can hedge your risks, can’t you?’ asked Keith.
‘Of course. Normally you do, but sometimes you want to take a directional bet on an index, and you don’t hedge. That’s what Nick Leeson did with the Nikkei when he broke Barings.’
Keith looked suitably chastened.
‘How much d’you want to trade?’ snapped Wallace.
‘As much as I can get without moving the price,’ answered Helen smoothly. ‘We’ve got plenty of capital, haven’t we?’
‘Unless the mighty Zamaroh feels like buying up the entire US treasury issue.’
They all smiled. Zaha Zamaroh, head of the trading floor, Iranian princess, with a throne of letters after her name: summa cum laude Harvard, MA Oxford, MBA Wharton. She ruled the floor with all the despotism, passion and bloody charisma of her Mogul forebears. She was the only person on the floor with a brain to match Wallace’s. Like most people, he was terrified of her.
‘Anything’s possible,’ said Helen.
‘Andy? What’re you up to?’ asked Wallace.
Every day Helen and Rankin told Wallace what they planned to buy and sell. Recently, Rankin seemed to trade less and less. Helen reckoned he’d lost his nerve after a string of losses earlier in the year. Got burned badly trading Topix futures. Lost two million in three weeks. It was hard to get back after something like that. Got to have balls, got to have faith in your judgement, know when to hang on in there, know when to cut. Rankin didn’t seem sure these days. The competition could smell uncertainty like dogs scented fear. They’d take you apart for it. Rankin was thirty-six, getting too old for the violence of trading. There weren’t many traders at the sharp end over thirty. Eyes flitting between flickering lines of information on four different screens, one ear on the phone, the other on the cries of colleagues, twelve hours of split-second calculations, judging-yourself and being judged on the score at the end of every day. These men and women lived and breathed the market. And outsiders thought they had a chance. She’d always tell people who asked: don’t play the markets, stick your money in blue-chip equities and forget about it. It’ll grow if you leave it alone, but trying to trade in and out, you’ll get hammered by the professionals, and the great queen market herself who’ll never forgive your lack of devotion. Leave it to the pros. Not even they got an easy ride. At thirty they looked forty. Many of them seemed to disappear. Where they went to, Helen didn’t know. The more socialised of them could rise on up the ladder and become management, watch other people burn out. The rest, if they were lucky, might manage to retire to the country. Helen sometimes wondered what would happen to Wallace. He didn’t need to work for the money. He must have made eight million over his fourteen years in the markets. He did it because he was addicted.
Rankin fiddled compulsively with his pen, twisting it between stubby fingers. ‘Yeah, I got a coupla things going, talking to a guy,’ he mumbled. ‘Might do some stuff on the KOSPI.’ The KOSPI was the Korean Stock Price Index, a wild market, where many traders had been burned.
‘Not quite ready.’
Wallace pushed back his chair and got to his feet. ‘What do the vultures keep telling you? Write tickets or die. On today’s performance you’re dead meat.’
‘What about you, Hugh, dead man walking?’ teased Helen. ‘When you gonna invent some juicy new product for us?’
Wallace waddled off to his office, hand in the air, middle finger raised.
‘That the best they taught you at school?’ shouted Helen.
‘One of these days you’re gonna go too far,’ said Rankin.
‘Yeah, but when? What’s a girl gotta do round here to get fired?’
Rankin gave her a puzzled look. He and Wallace had a private nickname for Helen, ‘the hairdresser’. She was revered across the floor for her ruthless ability to cut, or sell out, a position that was going bad. It seemed now she wanted to cut her own job. Rankin felt a flash of panic, mixed with envy. Helen’s rootlessness made her free. He was trapped, at work, in marriage, in worse. He averted his eyes from Helen’s, and called out to Keith. ‘Hey, Paul. Get me a cappuccino and bacon. Here’s five quid.’
Keith took the money silently. After six months on the trading floor he was used to being treated as a slave by imperious traders trying to shore up fragile egos.
‘Hel, would you like something?’
‘No, thanks, Paul.’
Keith wandered off, a disconsolate figure, six foot four, wraith-like. Helen wondered how long he’d survive on the floor.
Helen turned to her screens and tried to spot drama in the columns of figures, an irregularity, a blip, something there that shouldn’t be, something that might grow, widen, rip, alarm the faint of wallet, allow her to come in, dollars blazing, buy them out, sit them out, and profit. She was a contrarian, by inclination. She made large and spectacular trades against the market every few months and made, sometimes lost, millions of dollars for Goldsteins. Usually she came out ahead. She had a finely honed sense of intuition. She would watch and wait, sense the markets, look for signs of change, buy in advance, hold, sell when it, whatever it was, happened. Sometimes it was nothing more than rumour, sometimes it was a Brady plan to bail out the banana republics, sometimes it was a war. But today the figures mocked her in silent superiority. They held true. If there were anomalies, she couldn’t see them, if there was a war brewing, she couldn’t feel it. Perhaps she wasn’t in the mood to look. She was restless, her mind unquiet.
The trading axes she announced to Wallace were pure contingency. Only one thing was taboo on a trading floor: to answer a question with I don’t know. You always knew, you were always blithely certain of yourself. You always had a view. Hesitation was for losers, equivocation for Oxbridge tutorials. It was buy, or sell. In between was the killing ground of hold. Talking to clients or counterparties, every morning it was, ‘What’s your story?’ Everyone spun tales — confuse the opposition, finesse them. But you had to know when a story became a trade, or else you’d end up finessing yourself.
She thought briefly of Roddy and Roz and all the others at dinner last night. They’d still be fast asleep. She recalled Roz’s nasal whine.
‘Easy money, the City. Just cruise in, cruise out, shout down the telephone and make a few million.’ Yeah, Roz, she thought, come and try it, babe. She glanced up at her telephone dashboard to see one of the lights flashing. She pulled on her headset, spoke into the tiny mike suspended before her mouth.
‘What’s big and fat and hungry?’
‘Bernie Greenspan at 8 a.m.’
‘Gonna have to start telling dirty jokes.’
‘Think I wouldn’t get those?’
‘Yeah, right. Scratch that. Doing anything?’
‘Not much. You?’
‘Sweet FA. Still wanna play Goldfinger this morning?’
‘More into massage parlours, Bern.’ Traders gave nicknames to just about everything. Massage parlour was code for oil. Helen toyed with the image of parlour patrons being smeared with North Sea Brent.
‘What d’you want? Six month?’
‘Maybe. What price three month, put and call?’
‘You want a call.’
‘Humour me, Bern.’
‘Oooh Bernie, big, like always.’
‘Yeah, yeah, ’scuse me asking, but what d’you call big this morning?’
‘Five thousand contracts.’
‘At the money. Eighteen forty.’
‘Call you back.’
Five minutes later he was back on the line.
‘1.10, 1.30 call, .97, 1.17 put.’
‘I’ll buy five thousand calls on three-month crude at 1.30.
There was a slight gasp. Bernie had been expecting her to go the opposite way and to sell calls.
‘Done,’ he said sullenly.
‘Done,’ she responded. ‘C’mon, Bern, you angel. I’ll buy you a drink.’
‘It’s a deal.’
He began to scream in mock horror at the prospect of another deal with Helen Jencks. Helen took off her headset and laughed.
‘Long oil,’ she shouted out for Wallace to hear. ‘Ninety-two. Three month.’ Rankin, three feet away, had heard it all first hand. Wallace waved to show he had heard. Helen wrote out the ticket. Five thousand call option contracts at $1.30, multiplied by the contract size of 1,000 barrels totted up to $6,500,000 in premium which she would have to pay tomorrow. This premium granted her the right to buy, in three months’ time, 5,000 contracts of 1,000 barrels each. That amounted to five million barrels of oil, a position worth, at the strike price for Brent crude of $18.40, a total of ninety-two million dollars. On anyone’s terms, a lot of oil. She felt the quick thrill of the trade, but, beyond that, dispassion. She had done what she knew to be dangerous, dealt while equivocal about the trade, but she was cruising on luck. She’d had a good run, six weeks. She felt there was a little way still to go.
The desk had gone uncharacteristically quiet. Helen looked up to see Zaha Zamaroh standing to one side of her, peering at Paul Keith as if he were a laboratory specimen. Keith coloured slightly, a doubtful smile flickering on his lips as he stared up at Zamaroh. Five foot eight and a hundred and sixty pounds of Chanel-swathed goddess, fire-engine-red suit with lips and talons to match. He wouldn’t have believed in her if he hadn’t seen her with his own eyes. She was like something out of a children’s story crossed with an adult magazine: the wicked stepmother meets Jessica Rabbit, with a brain that would blow a mainframe computer.
‘Morning, Paul. How’re you getting on?’
‘Morning. Er, well, thanks. Helen’s been helping me.’
‘That’s a mercy.’ She turned to Helen. The two women enjoyed a polite mutual respect, but kept their distance.
‘I’m glad to see someone’s writing tickets around here,’ said Zamaroh, nodding at the blue trading ticket in Helen’s hands. ‘Profitably, one assumes.’ She turned to Rankin.
‘Well, look what we have here, a walking lavatory brush. You might hire yourself out, Rankin. You’d make more money than you’ve made for the desk.’ Helen winced. Rankin stared straight ahead, said nothing.
‘Couple of pounds an hour would be a contribution,’ continued Zamaroh. She came up closer and bent down over Rankin. ‘You’re two million down, Rankin, and I’m about to stop counting.’
‘Makes her feel good,’ said Helen, watching Zamaroh walk away. ‘Slay a few slaves every morning.’
Paul Keith tried to look invisible. Rankin stared at his screens, a vein throbbing in his forehead.
‘She should be put down, that woman. Psychopathic bitch.’
‘You might be a bit strange too, Andy, if the ayatollahs had hanged your father,’ replied Helen.
Rankin snorted, got up from his desk, and skulked into Wallace’s office. The two of them remained locked away for over an hour, trying to salvage Rankin’s career, reckoned Helen.