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Four years ago Matheus Pereira was taking his final exams at Wharton business school. Today he reckons he is responsible for 3% of US high-yield bond trading volume. His meteoric rise has been made possible by the shift towards passive investing and fixed-income ETFs.
Mr Pereira says a lack of familiarity with old systems is liberating. He likens the bond market to the “marshmallow challenge” created by designer Peter Skillman: a team has to quickly create the tallest structure they can that will support a marshmallow, using 20 pieces of spaghetti, a metre of tape and a piece of string. Pre-school children consistently beat business school graduates, lawyers and executives. “They [the children] are not thinking about the rules of physics and what is logical,” he says. “They are really just trying to think of what works.”
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