Did I do something stupid...?

[Omrudra]

Hi all,

I just graduated with an MBA from a good business school and am committed to becoming a prop trader. I had applied to some prop firms whilst waiting to hear from a few, had an invitation from Futex for an assessment centre. I am confident of getting thru but I declined the invitation since in my current situation the £400-500 they pay for training would not be enough by a long long shot. But I researched the company and liked their training program as well. Was it foolish of me to wait for an offer from a firm that pays a basic salary? Thanks in advance for any replies.

 

[Directional]

almost no prop firms offer basic salaries at all, and most of the few that do will not offer much - usually in the region that you have mentioned.

the idea is that you eventually make money from trading, not from a salary, and you nomally will need to be able to support yourself to a large extent while you put in the ground work to learn your trading skills - if you want a big salary then you'll need to be talking to an investment bank or bulge bracket firm, not a prop house.

 

[Omrudra]

almost no prop firms offer basic salaries at all, and most of the few that do will not offer much - usually in the region that you have mentioned.

the idea is that you eventually make money from trading, not from a salary, and you nomally will need to be able to support yourself to a large extent while you put in the ground work to learn your trading skills - if you want a big salary then you'll need to be talking to an investment bank or bulge bracket firm, not a prop house.

Thanks for the reply.Siigh so in the context of my quest to be a prop trader that WAS foolish. But I am determined to purse it. Are you able to advice me on things I can learn or do in the meantime so my cv is appealing to the prop firms as well help me get a head start? I have heard that my p/l ,would be a big plus but since I do not have money to start trading that is not an option presently.Also a dummy account does not impress them does it? Any help is appreciated.

Thanks

 

[RichieE]

I just graduated with an MBA from a good business school and am committed to becoming a prop trader.

Omrudra, no offence, but if you're really committed to become a prop trader why did you get an MBA in a first place? That seems like a strange path.

I had applied to some prop firms whilst waiting to hear from a few, had an invitation from Futex for an assessment centre. I am confident of getting thru but I declined the invitation since in my current situation the £400-500 they pay for training would not be enough by a long long shot.

No prop firm will pay a salary. The only reason why you get £400-£500 at FUTEX is to cover expenses for the duration of your training since you are not trading.

I researched the company and liked their training program as well. Was it foolish of me to wait for an offer from a firm that pays a basic salary? Thanks in advance for any replies.

If you think you think you can make it as a trader why don't you try getting into an investment bank. However, even with your MBA you'll be expected to start at the bottom!

Good luck!

 

[Omrudra]

Omrudra, no offence, but if you're really committed to become a prop trader why did you get an MBA in a first place? That seems like a strange path.No prop firm will pay a salary. The only reason why you get £400-£500 at FUTEX is to cover expenses for the duration of your training since you are not trading.If you think you think you can make it as a trader why don't you try getting into an investment bank. However, even with your MBA you'll be expected to start at the bottom!

Good luck!

None taken. Thank you for the reply. Well the MBA was because I had to prove something to myself. I dont mind starting at the bottom at all but the IB seems to be leaning towards really top tier schools ( I did my MBA from the University of Strathclyde)and also relevant work experience. Thanks for the input.

 

[RichieE]

None taken. Thank you for the reply. Well the MBA was because I had to prove something to myself. I dont mind starting at the bottom at all but the IB seems to be leaning towards really top tier schools ( I did my MBA from the University of Strathclyde)and also relevant work experience. Thanks for the input.

An MBA for personal gain is fine. But you're up against the Ivy League when you're talking about MBA recruitment. You really need to be in the Harvard, Stamford, London Business School or INSEAD league to be in with a chance at a tier 1 bank. You might still have some luck with some smaller outfits. (Note: I don't have an MBA, but I know some people who recruit or have been recruited at the post-MBA level and thats the impression that I'm getting).

However, don't let anyone put you off joining a prop shop if that's what you really want. (Including me!) There shouldn't be any prejudice against you. I was by far the oldest person in my interview at Schneiders. I was the oldest by about 10 years in my training class and was still selected over several younger guys so your past history shouldn't hinder you at all.

Good luck!

 

[supa2532]

hi there RichieE, i am interested in your employment with Schneiders...how is it working for them? career progression etc? i hear Schneiders dont pay well but there are opportunities? Are schneider a investment bank?Also Richie can annual salary from a lower tier bank if trading successfully for a few years be simular to the large salaries of top tier banks? i presume not due to commision on larger portfolios....but you know better than me...can you help? If you decided not to take employment with schneiders but still know the answers to the questions im pondering....please give me advice still...take care, Neil

 

[Directional]

Schneider is a pure proprietary trading firm, not an investment bank.

 

[RichieE]

hi there RichieE, i am interested in your employment with Schneiders...how is it working for them? career progression etc? i hear Schneiders dont pay well but there are opportunities? Are schneider a investment bank?

Schneiders operate like any other prop house. Therefore they *do not* pay a salary. Other firms such as FUTEX pay a small stipend to cover your expenses during their training period. Schneider's training course is only 1 month long (c.f. FUTEX - 6 month course). They are *NOT* an investment bank.

Also Richie can annual salary from a lower tier bank if trading successfully for a few years be simular to the large salaries of top tier banks? i presume not due to commision on larger portfolios....but you know better than me...can you help?

You are correct - the answer is no. To get paid the big bucks you have to work for a 'bulge bracket' investment bank or other similar institution (e.g. if you trade oil that will be BP or Shell).

If you decided not to take employment with schneiders but still know the answers to the questions im pondering....please give me advice still...take care, Neil

I did take up the position at Schneiders and stayed there for 3 months in total. I am currently taking a sabbatical in a relatively well paid (i.e. six figure) role to put myself in a better financial position before I commit to trading full-time. Although I'm relatively confident that I can make it, I have a mortgage and a few debts to pay off.

If you are going down the prop-trading route bear in mind that there is no guarantee that you will be able to draw a salary for at least 3 months if not 6 months. Due to the recent subprime crisis I have seen friends at prop houses struggle since the STIR/Bond/Bobl/Schatz/TED spreads have been all over the place and some have not drawn a salary for 9 months or so.

Although I wanted to stay I didn't think that it would be prudent for me to gamble with the mortgage payments on my apartment so I've taken a more prudent (albeit longer) route.

Hope that above helps.

 

[RichieE]

hi there RichieE, i am interested in your employment with Schneiders...how is it working for them? career progression etc? i hear Schneiders dont pay well but there are opportunities? Are schneider a investment bank?

Schneiders operate like any other prop house. Therefore they *do not* pay a salary. Other firms such as FUTEX pay a small stipend to cover your expenses during their training period. Schneider's training course is only 1 month long (c.f. FUTEX - 6 month course). They are *NOT* an investment bank.

Also Richie can annual salary from a lower tier bank if trading successfully for a few years be simular to the large salaries of top tier banks? i presume not due to commision on larger portfolios....but you know better than me...can you help?

You are correct - the answer is no. To get paid the big bucks you have to work for a 'bulge bracket' investment bank or other similar institution (e.g. if you trade oil that will be BP or Shell).

If you decided not to take employment with schneiders but still know the answers to the questions im pondering....please give me advice still...take care, Neil

I did take up the position at Schneiders and stayed there for 3 months in total. I am currently taking a sabbatical in a relatively well paid (i.e. six figure) role to put myself in a better financial position before I commit to trading full-time. Although I'm relatively confident that I can make it, I have a mortgage and a few debts to pay off.

If you are going down the prop-trading route bear in mind that there is no guarantee that you will be able to draw a salary for at least 3 months if not 6 months. Due to the recent subprime crisis I have seen friends at prop houses struggle since the STIR/Bond/Bobl/Schatz/TED spreads have been all over the place and some have not drawn a salary for 9 months or so.

Although I wanted to stay I didn't think that it would be prudent for me to gamble with the mortgage payments on my apartment so I've taken a more prudent (albeit longer) route.

Hope that above helps.

 

[eteroje]

OOooops

Hi all,

I just graduated with an MBA from a good business school and am committed to becoming a prop trader. I had applied to some prop firms whilst waiting to hear from a few, had an invitation from Futex for an assessment centre. I am confident of getting thru but I declined the invitation since in my current situation the £400-500 they pay for training would not be enough by a long long shot. But I researched the company and liked their training program as well. Was it foolish of me to wait for an offer from a firm that pays a basic salary? Thanks in advance for any replies.

Yeah that was a bit daft!!! hehe But if you are regretting it, why dont you reapply for the position?