Career Prospects After working for Firms Like Tibra and Optiver

[cylinder]

to Hoodtrader, do you find that most IBs recruit from economics background graduates, and how easy is it to be recruited with a PhD in a non economics field, and do they prefer particular (perhaps more quantitatively based) PhDs over others. Also, what's the usual age of entry on a trading desk in your IB, and in talking with some of my economics focused friends they've quoted some outrageous (at least to me) bonuses in the 10's of millions range for traders at IBs. Are these 'rumours' realistic, how many people acquire bonuses of this range? Also, on a totally different note, with the large increase of automated/algorithm trading do you see a place for human traders 5-10 years down the track, how much do you rely on automated systems?

If you can share your views on these questions it'd be much appreciated, as like you I am trying to make some difficult decisions.

 

[gooseman]

people keep on asking about 'traders' but there are so many different areas of trading at an IB or a MM'er. In IB's alone you will have a prop desk, hedging desk, swaps, algo allsorts. it is impossible to say you will be this and you will earn x amount. sure there are prop guys who will take home literally millions in bonus. theer are also the different markets. if you know what you're doing and you're one of the few people in the market, on OTC's you can make an incredible amount of cash just because there is no market transparency. a young-ish GS trader took home i think in the 00's of millions betting against sub-prime.

if you look at wanting a position based on potential earnings alone I'd say your citeria were wrong. you must have an idea what you would like to do-fx, fixed income, commodities, equities etc and whether you want to be a vol trader, directional, swaps, swaptions, options, FRA's, algo-the options are limitless.

 

[HoodTrader]

I think it is true that some banks do like the economics degree, but to be honest my intake year for the london office only had 2 out of 25 so thats a small percentage. The highest level of qualifications were MSc's, so I guess that with any PHD maybe you have an advantage? I dont know really.

The average age for intake was about 24 for markets and slightly higher for banking/corp finance.

In terms of bonuses you will hear stories and your right they are all outrageous, dont get me wrong you can earn handsomly. I would suggest you to just check out CEO salaries, they are easily accessible on the net and well you can work out how many levels you will work below them and therefore what you bonus will (or more accurately wont exceed).

Finally algorithmic trading, I have seen none of this on my desk. Lots on equities though. I am not worried right now and I dont foresee that I would be in the naer future, a bear market would be more of an issue.

 

[bambouk]

a young-ish GS trader took home i think in the 00's of millions betting against sub-prime.

Oh look... another rumour...

 

[bambouk]

The average age for intake was about 24 for markets and slightly higher for banking/corp finance.

That's ancient for a London based office and grad class. Must have had a heavy continental contingent bringing up the average.

 

[bambouk]

to Hoodtrader, do you find that most IBs recruit from economics background graduates

They do but not exclusively.

and how easy is it to be recruited with a PhD in a non economics field

Relative to having a PhD in a field of economics? There ought to be very little difference. They do recruit for reasons a little more diverse than programme of study.

and do they prefer particular (perhaps more quantitatively based) PhDs over others.

Depending on the role - but given that this is 'trade2win', I'll safely stick to 'yes'.

Also, what's the usual age of entry on a trading desk in your IB, and in talking with some of my economics focused friends they've quoted some outrageous (at least to me) bonuses in the 10's of millions range for traders at IBs. Are these 'rumours' realistic, how many people acquire bonuses of this range?

Yes, people took home that much money. The number would be small.

Also, on a totally different note, with the large increase of automated/algorithm trading do you see a place for human traders 5-10 years down the track, how much do you rely on automated systems?

Well, I definitely see them sticking around. Automated systems in a multi-decision making context like trading is not strictly different to say, driving (or flying). Given the tendancy for markets to skew towards a few winners taking all (if that many), I see humans sticking around in the process for a very long time.

 

[gooseman]

Oh look... another rumour...

that's a fact buddy-he took the money and started his own fund with it.

 

[bambouk]

that's a fact buddy-he took the money and started his own fund with it.

In which case, who he is ought to be pretty to establish...?

Must be a pretty microsized fund if it is based off bonus money alone. Even Driss would have found his bonus a bit meagre for that. Nor do I remember there being a fund specifically short MBS (as opposed to funds that have recently been short MBS).

 

[gooseman]

hundreds of millions of a successful trader's own money would be easy to attract plenty of capital to a credit trading fund I would have thought....

 

[bambouk]

hundreds of millions of a successful trader's own money would be easy to attract plenty of capital to a credit trading fund I would have thought....

No trader at Goldman Sachs has ever been paid that much in a single bonus. Driss included. Nowhere near that much.

Driss Ben-Brahim - Wikipedia, the free encyclopedia

Although, he has just left for GLG.

 

[gooseman]

source wikipedia (2006). i'm not going to argue mate-i know a guy this year paid more than £30m. and i certainly know guys paid bonio between 1-10m gbp.

 

[bambouk]

source wikipedia (2006). i'm not going to argue mate-i know a guy this year paid more than £30m. and i certainly know guys paid bonio between 1-10m gbp.

I'd argue about it - since I'm quite happy to slam my fist on the table and scream "BS"

Not only have you moved away from the 'hundreds of millions' claim that you made earlier - but you won't name these people or what they are doing.

Feel free to PM and I'll ask friends on the GS floor in London to confirm whatever it is you are saying. But I'm going to guess you are just giving more of those loving rumours.

You could pop open Trader magazine to see that there aren't exactly scores of people at GS picking up 30 million GBP plus (including options and assets that are not immediately liquid).

 

[gooseman]

well, bully for you mate. bang away.

i said one trader made it. and why would i name people i know on a message board. any half decent prop rtader at a bank should be walking away with 1m+. granted this year will be different but the free money game of the last couple of years is no longer there.

i'm not ging to play your 'my mates at goldmans' game either. believe what you want to believe, i simply don't care.

Trader magazine-a freebie mag for wannabees to look at vertus phones and expensive wines.

if you work in trading you will know who the big boys are and you know how much their bonus pool was.

 

[bambouk]

Then name the one person in a private message. I actually have mates at Goldman - perhaps unlike you? I don't know you - but I'm extremely dubious of this 'rumour' you've put forward and refuse to back.

I think you're just too damn ashamed to admit you spilled out another rumour of trader multi-millions that isn't real.

Which enormous MBS fund is this? The MBS funds I know are Ellington, MKP and Nayan - none of which fit the profile of your alleged fund since they're all a little too old (either by the person running, or in inception date) to fit in with a trader in the 00's making millions ("hundreds of" - your words) and starting up.

Trader Mag - not exactly free, not entirely pith either. They put some effort into the one thing people look at.

 

[gooseman]

not to satisfy your whims mate-no.

i speak to GS daily....

it's not an MBS fund0didn't say it was.

good day to you-minutes out in a sec......

 

[bambouk]

a young-ish GS trader took home i think in the 00's of millions betting against sub-prime.

So he got big for MBS trades and then did a conventional credit fund? What like a corporate credit fund?

Your rumour is getting ever so elaborate...

You can PM HoodTrader - I'll send him the name of someone at GS and he can verify it. I'm not interested in the name, I'm fascinated by your 'rumour'. Or total BS as the case may be.

You're not the only person in the world by a mission who 'speaks' to GS daily. I guess by saying that, you're not actually trading with them.

 

[gooseman]

no-i was alluding to the bonus paid to one particular london guy was not a credit fund. not talking about the GS guy.

as i said i don't give two hoots what you think, nor am I going to pm someone from a message board i don't know from adam.

didn't say i was, or was not.

as i said-if you think i'm pedalling a rumour then fair enough. I DON'T CARE.

you seem to know what you're on about so you'll know how much the swingers in this horrible little game get in their package and millions is not an exaggeration.

you're clearly an argumentative bloke by your own admission. well, i'm not on here for an argument or debate and i do have some work to get on with. we can settle on this......traders get money based on performance. if you're good-you can earn lots.

 

[bambouk]

Hardly any are picking up over 30mill. And certainly not the hundreds of mill number you have earlier on in this thread.

At least you hack out of your losing positions...

 

[HoodTrader]

Interesting... at least there is something to read on here this morning

Im sure that there are lots of guys earning 30m.. but until we are that guy I dont think that we should give a flying... fish!

On a side note I hear that 90% of fund managers lose money! Perhaps not the wisest investment then.

 

[bambouk]

Interesting... at least there is something to read on here this morning

Well you know how prolific I can be when it comes to writing things...

Im sure that there are lots of guys earning 30m.. but until we are that guy I dont think that we should give a flying... fish!

Look around your floor. There aren't that many. Offered at 5%.

On a side note I hear that 90% of fund managers lose money! Perhaps not the wisest investment then.

You know how meaningless that statistic is I doubt there are any fund managers that always always make money...