How to become a Real Time Power Trader?
I had not even considered power previously (due to my non-coding background) but a veteran electricity trader recommended me to look into real time as an entry point to electricity trading. In my downtime from work in the past day, have been reading Energy Trading and Investing and online sources to gain a sense of what it even entails. As I understand it, the general architecture involves the regions dominated by vertically integrated utilities and "deregulated" segments operated by ISOs / RTOs (these focus on the transmission high voltage line rather than distribution and balance SnD through dispatching / scheduling / capacity / congestion relief / physical auctions - split into real time or day ahead where the latter sees more generation capacity and is probably why DA is seen as a step ahead of RT I suppose. I am still very fuzzy on the details and obviously still need to a lot read more so had a couple of questions to any power traders here:
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Would I really have a shot at this if I don't come from a quant background? I had been studying much more on crude / refined but I am keeping my options open to anything that opens doors to me having an entry point to trading and I still find it very interesting. I don't mind grinding out night shifts or long hours and I am in HTX.
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Besides the book I mentioned and some of the misc videos I was able to access from ISO websites, what are some recommended resources to a complete beginner like myself? Something akin to a comprehensive primer like a commodities demystified or Oil 101 to electricity specifically? I find myself spending a lot of time finding definitions for terms that are just assumed to be known by the reader (I am fine doing that by the way; just wanted to see if I can get up to speed faster so I am prepped sufficiently in case an opportunity arises).
Use your network to get to know people in the power space and start to see what kinds of resources they would recommend learning to maybe make a transition to power. The commodity network is pretty tight-knit especially in HOU. If you provide some more color about your current situation I could maybe give you some feedback in addition.
Diving into the world of real-time power trading without a quant background might seem daunting, but it's definitely possible with the right approach and resources. Based on the most helpful WSO content, here are some steps and resources to consider:
Understand the Basics: You've already started with "Energy Trading and Investing," which is a great first step. Continue to deepen your understanding of the electricity market's structure, including the roles of ISOs/RTOs, and the differences between real-time and day-ahead markets. This foundational knowledge is crucial.
Educational Resources: Look for comprehensive guides specific to the electricity market. While the context doesn't list a specific "Electricity 101" book, the titles mentioned like "Trading Natural Gas" and "Understanding Today's Electricity Business" can offer valuable insights into energy markets. Additionally, exploring resources like "Electricity Markets: Pricing, Structures and Economics" could provide a broader understanding of the market dynamics.
Online Courses and Webinars: The WSO Academy and other online platforms offer courses related to financial markets, including energy trading. While not specific to real-time power trading, these can provide a solid foundation in trading principles and market analysis.
Networking and Mentorship: Connect with professionals in the field through platforms like LinkedIn or energy trading forums. The advice from a veteran electricity trader is a testament to how valuable these connections can be. Seek out mentors who can offer guidance, share their experiences, and possibly open doors to opportunities.
Practical Experience: While not directly mentioned in the context, gaining practical experience through internships or entry-level positions in energy firms can be invaluable. Even roles that are not directly in trading can provide exposure to the industry and help build relevant skills.
Develop Analytical Skills: While you may not come from a quant background, developing strong analytical skills is essential. Familiarize yourself with the tools and software commonly used in the industry. Excel is a fundamental tool, and proficiency in it, including understanding advanced formulas and modeling techniques, can be very beneficial.
Stay Informed: Keep up with industry news and trends. Websites like the Wall Street Oasis forums, energy market news platforms, and regulatory body updates can provide current insights into the market dynamics and potential changes affecting trading strategies.
Remember, persistence and a willingness to learn are key. The energy trading world is complex, but with the right approach, you can navigate your way into a real-time power trading role.
Sources: 2010 Energy Trading List, Trading Vol in an IB - what are the good resources for Rates, Credit, FX, Equities? Market-makers' help greatly appreciated, Books on Physical Commodity Trading, Physical Energy Trading And Logistics
Yes, you absolutely have a shot. Real time or other physical trading in electricity doesn't require a lot of programming.
I don't think there is one book that is going to describe the electricity industry well. I'd recommend going to the ISO and RTO websites and watching their 101 videos (I'm think PJM 101 and ISO-NE 101 specifically, not sure if many other ISOs have something similar but all have online training videos). That's a basic training on what is going on in the market, setting prices, etc. You could also read their state of the market report if you want to see a bigger picture of what's going on but that's going to be a bit more technical. From the business side, you may want to look for some papers on retail energy markets. That will explain a bit of the end-user sales and how each state is a little different.
If you want to start looking at data, the EIA is a great place to start.
Not OP but would these companies be willing to take new grads with no electricity experience for these RT programs?
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