By Robert Hunter

The trading pits of the Chicago Mercantile Exchange are not for the faint of heart. The combination of high financial stakes, cramped quarters and cut-throat competitiveness—not to mention the appalling wardrobe requirements—has sent more than one young trader-to-be scurrying for the exits in search of a desk job.

Not so for Lewis Borsellino, a Merc legend and author of The Day Trader: From the Pit to the PC, scheduled to be released next month by John Wiley & Sons. “The day I went to the Merc for the first time,” he writes, “I knew I had found my calling—I heard the noise, I saw the chaos, I felt the energy and the excitement—and I loved it…There was money in the air.”

Such is the tone throughout Borsellino’s autobiographical account of his 18 years at the Merc. Borsellino grew up on Taylor Street in Chicago’s Near West Side, the son of a small-time Mafia figure who was convicted in 1965 of trying to pull off a million-dollar silver heist. The lessons Borsellino learned early in life would serve him well in the Standard & Poor’s 500 pit. When young Lewis returned home from grade school after being beaten up by an older, bigger bully, his father demanded that he go back and defend himself; by his mid-30s, Lewis the S&P trader had earned the dubious distinction of amassing more Merc fines for fighting, pushing, shoving and swearing than any other floor member.

Of course, there is much more to Borsellino’s legend than pugilism and pencil stabbings. He got his start at the Merc after his mother’s boss, Maury Kravitz—who later would form Sakura Dellsher with Leo Melamed—gave him a job as an assistant in the gold futures pit in 1981, filling Kravitz’s orders and, eventually, trading for his own account. His early days were rocky, but when a trading gaffe netted him $57,000, he knew he was in the right business. “A month afterward,” he says, “the S&P pit opened, and I never looked back.”

By 1986, Borsellino had become the pit’s biggest player, routinely accounting for 10 percent of a given day’s volume. “All the big institutional players—Paul Tudor Jones, Richard Dennis, even Morgan Stanley—would hire people to watch me to see what I was doing,” he says. “I had to find ways to out-smart them. If I wanted to be buying, I’d give orders to the order-fillers around the pit to buy and then I would start offering them down, and vice versa.”

The Day Trader’s account of the 1987 crash is particularly riveting. By October of that year, Borsellino had amassed $2 million year-to-date in the runaway bull market. He decided to take a trip to Switzerland with some buddies for some R&R. While haggling with a watch salesman at Piaget in Zurich, Borsellino looked out the window and saw on a building-side ticker that the U.S. stock market had fallen 500 points. He rushed back to his hotel, where he got frantic messages from his wife and brother, who were worried that the Merc was going to be closed permanently. Borsellino rushed home, arriving at the Merc around noon on Black Tuesday. After quickly assessing the carnage, Borsellino jumped into the pit and made $500,000 that afternoon—and another $500,000 the next day. On Thursday morning, he helped bid the market down from 500 to 5,600 before opening, then bought 150 contracts. “It was a free fall,” he writes, “but we had to be near the bottom, my gut told me.” Seconds later, he got an offer to sell at 2,000 points higher than his purchase price and he took it, making $1.3 million. “I handed my last trading card to the clerk, walked out of the pit, went into the bathroom, and threw up…I tasted the bile in the back of my throat and knew what my gut was telling me—it could have just as easily gone the other way…If the market had gone against me, I would have been wiped out.”

While October 1987 may have been Borsellino’s heyday, he has remained a big player at the Merc ever since, and has positioned himself to take advantage of the inevitable switch to electronic trading. In January 1998, he started an electronic day-trading commodity trading advisory firm specializing in managed futures, called Borsellino Capital Management, with a mere $500,000 under management. A year later, that figure had risen to $10 million, and the fund’s returns were 15.8 percent in 1998. “We’ve done that just day-trading S&Ps,” he says. While he may have his hand on the pulse of the all-electronic future, he hasn’t gotten the trading floor completely out of his system. “I still go there every morning,” he says. No doubt to get a fresh whiff of the money in the air.

Tanya Styblo Beder, one of the two founding partners of Capital Market Risk Advisors, is leaving the firm. “After 13 years, I’ve decided that I’m ready for the next thing,” says Beder, who started the consulting firm with partner Leslie Rahl in 1994. Before CMRA, Beder was head of derivatives research and was a merger-and-acquisitions specialist at First Boston.

One of the next things on her agenda: getting married on June 19. She’s also evaluating job offers.

Beder has nothing but praise for her former associates. “It’s a fabulous firm with an incredible client roster,” she says. “As a significant shareholder, I certainly hope they make me very rich.”

• Dan Crowley as been appointed vice president of NASD governmental affairs. Previously, he was general counsel to House Speaker Newt Gingrich. Salvatore Sodano, former deputy chief operating officer at the NASD, has been promoted to chief operating officer.
• SS&C has announced a number of promotions. Steven Helmbrecht has been promoted from senior vice president for the Europe, Middle East and Africa business unit to senior vice president for international operations. Marc Zimmerman has been named senior vice president for mergers and alliances; he had been senior vice president of strategic sales at the firm. Robert Shepro will become senior vice president of product strategy.
• Digital River announced the appointment of Jay Kerutis as vice president of sales. He had been retail channel vice president at Merisel Americas.
• Gerald Mintz has been named president and CEO of FAME Information Services. He had been president and CEO of American Banker–Bond Buyer, a division of Thomson Financial Services. FAME has also appointed former Instinet CEO Michael Sanderson to its board of directors.
• Brian Rettenmaier, previously vice president of special projects at Columbia Energy, has joined AmerenEnergy as controller. Ron Ryckman, previously financial settlements manager and senior specialist at Enron, will be operations manager at AmerenEnergy.
• Triple Point Technology has hired Michael Cox as director of global energy sales. He had been director of international business development at TIBCO Software.
• John Bradbury has been named director of marketing at Principia Partners. Prior to joining the firm in 1996, he had been a consultant to the Morgan Stanley mortgage-backed securities trading desk.
• The Chicago Mercantile Exchange has made a number of appointments. Glen Madeja, former vice president and project director at Security Capital Real Estate, will be vice president of market data services. Joe Morrow, former manager of the financial institutions group at A.T. Kearney, will be responsible for retail marketing of broker services. Tina Lemieux, former director of currency and interest rate marketing has been promoted to vice president of currency and interest rate marketing. Peter Barker, former senior director of currency and interest rate marketing, has been promoted to vice president of interest rate marketing. Scott Brusso, senior director of currency and interest rate marketing, has been promoted to vice president of currency marketing.
  
• Garry Popofsky has been named head of sales and market in North America at NatWest Global Financial Markets. He had been senior vice president and head of sales for foreign exchange at Lehman Brothers.

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