Derivia Middle East Awards 2024: Personality of the Year - Mehdi Rayane

Mehdi highlights three aspects of his job that have helped him to grow into his role at Marex since he joined the non-banking issuer of structured products in 2023 -  the technical expertise around products and various formats; the company’s client-centric approach; and the need for cross-selling within the organisation.

In other words, “helping a client across multiple services that Marex provides”.

I have always been particularly intrigued by the tailor-made nature of structured products, which led me to pursue a career in this field - Mehdi Rayane

In his current role, Rayane is part of the company’s financial products team responsible for sales in the Middle East and North Africa (Mena) region at Marex Solutions.

Prior to joining Marex, Rayane worked eight years at HPC Investment Partners, a French structured products boutique which was acquired by Marex in 2023. He started on the platform solutions desk, developing pricing and lifecycle management platforms. After two years, he sought a shift into a sales role and started to cover clients in the BeNeLux region.

“This was a very positive experience for me as I was able to leverage my product expertise in a larger organisation with many more solutions to provide my clients with,” he said.

Before that, Mehdi worked at Société Générale, BNP Paribas and UBS.

Mehdi studied Maths and Physics during his “Classes Préparatoires” in France and later on he got involved with the finance world at EDHEC Business School, where he developed an interest in financial markets.

“I have always been particularly intrigued by the tailor-made nature of structured products, which led me to pursue a career in this field,” said Rayane

At a personal level, Rayane is a keen martial arts fighter who trains 10-12 hours per week and has competed at a semi-professional level in Muay Thai (Thai boxing) for a few years now. He also enjoys other adrenaline sports like paragliding, surfing, etc.

“I do really enjoy competitive and adventurous activities outside of work,” he said, and point at his mother Samira as the main source of inspiration and values.

“She is a very strong and loving woman who raised four kids. I would describe myself as optimistic, determined and loyal, and can only attribute those qualities to the influence of my mother,” Rayane said.

Catching up

Rayane highlights two major events that have impacted the structured products industry over the past 10 years including the implementation of the Markets in Financial Instruments Directive (MiFID) in Europe, “which triggered a significant compliance-related exercise across the industry; and the increasing need for automation and technology which has reshaped the market over the last decade”.

“The structured products market has clearly moved towards more automation, but it is still lagging behind other asset classes like cash equities and fixed income,” said Rayane.

“The core structured products business still requires human involvement, especially for activities like idea generation and providing adequate servicing to clients. There is scope to further automate the value chain.”

Rayane, however, points at recent market incidents involving major players in the structured products market such as Credit Suisse which illustrate that “human involvement can be crucial in complex situations, where automation alone may not be sufficient”.

“While automation can improve the efficiency of standard flow requests, the more structured and customised products still benefit from the expertise and client-centric approach of human actors,” he said.

Opportunities, challenges

Marex is closely monitoring interest rates in the MENA region as a key focus area. The local fixed income market in the Gulf Cooperation Council (GCC) is still very attractive for investors, with Saudi Arabia offering high returns compared to other investments in USD, according to Rayane.

To compete with the local fixed income market, Marex is focusing on solutions such as credit-linked notes referenced to single sovereign and large corporations, reverse convertible on bonds, and building derivatives on regional funds.

“The goal is to offer products that can provide both performance and protection,” said Rayane.

“We will continue to focus on alternative solutions to the fixed income market in the MENA region to bring value to investors.”

Rayane notes that what resonates with investors in the region is the ability of structured products to offer protection plus upside potential.

“This is particularly challenging to find in the local fixed income market, which is very aggressive in terms of returns,” he said.

“Our approach with structured products for new clients is to remain simple: they usually start with two profiles. A defensive product (capital protection + positive upside) and a more aggressive one (yield-enhancement with a protection on the downside). The goal is to demonstrate the performance of structured products and build trust before introducing more complex solutions.”

Portfolios construction

Rayane also pointed at the way structured products are viewed in a portfolio context can vary depending on the client's flexibility and approach with some clients looking at equity-linked structured products as part of their equity allocation while others may view them more as part of their fixed income allocation, focusing on the capital protection aspect.

“It is important to be able to offer bespoke and tailored solutions to meet each client's needs and preferences,” he said. “The flexibility of structured products from a market exposure, duration and payoff structure is unmatched in the market.”

Crypto derivatives will continue to be an area of focus, expertise and differentiation for Marex which has a dedicated desk led by Harry Benchimol which also serves the Mena region.

Mehdi pointed at an Index tracking a future on Bitcoin with a vol target mechanism to provide a client with a seven-year exposure on Bictoin which “is unique in the crypto space”.

“[We] have a robust and genuine approach to crypto derivatives,” said Rayane. “We can deliver simple structured products like autocallables or capital-protected notes, as well as more bespoke crypto-linked solutions with more complex payoff types. This allows us to meet the needs of different risk profiles among our clients.”

However, according to Rayane, this is not the only business line driving new activities and growth for the company as the company’s Funds, Quantitative Investment Strategies (QIS) and Actively Managed Certificates (AMC) team is also well placed to address clients’ needs in funds derivatives, bespoke indices and managed strategies.

 Growth, market potential

Marex is approaching all markets in the MENA region with a particular focus on the GCC from Dubai where Marex has an office. Last year Marex agreed to acquire Aarna Capital, a clearing business based in Abu Dhabi, adding to its regional presence.

“We don't want to focus on structured products only as we want to leverage our multi-asset approach and offer a comprehensive array of services to our clients,” said Rayane. “This includes clearing on futures exchanges, broking on multi-asset classes, market making on commodities and hedging and investment solutions.”

Rayane noted that Marex's growth strategy in the region is based on leveraging the platform it has built, which “connects clients to markets through an interconnected and supportive set of services, aiming to become more relevant to its clients by adding more products, more capabilities and more geographies”. 

“When we engage with clients, we take a multi-asset approach and offer a full suite of solutions beyond structured products,” he said.

“[We are] well positioned to leverage its multi-asset approach and expand its footprint in the region, offering clients a comprehensive array of structured products, clearing solutions, brokerage, and market making.”

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