For those of you who have had trading experience or have shadowed enough traders during internships,
what is the usual P/L of a trader per day for any desk that you've observed...
like let's say a cash trader on a good day would have 10k profit while on a bad day 50k losses...
maybe give me an idea of the variance of the P/L and the distribution...
I think this would be very interesting data to compile to see what desks generate the most profits and thus would be the first candidate to expand during a boom and the last candidate to get cut during a recession
THANKS!
Depends on how the book is positioned, but I would say that making anywhere from +500K to -250K is about average for a slightly more illiquid product such as FX options or Securitized Products.
In the more liquid products like FX, there is usually a loss limit for junior traders. For spot FX guys at my firm it is 100K (not sure if ED/MDs have one).
So it would be more advantageous to be trading a more illiquid product because essentially you are more valuable to the firm?
Also, do you think it would be appropriate to ask this to an employer/co-worker during an interview? during a summer internship? ever?
Not that you are more valuable to the firm. There is nothing stopping a trader from make much more than those numbers and I am sure that there is a certain stop loss for illiquid products, I'm just not sure what it is.
Only ask about PNL after you get to know a guy and are interning---even then you are only going to get general numbers.
http://www.wallstreetoasis.com/forums/a-response-to-which-desk-is-best-…
woops sorry didn't see that i feel stupid
Gekko: Are you talking about day-trading $250-500k (collecting $250-500k of edge) or the overall position swinging that much?
It is going to be hard for an individual or even small group to collected half a mill in edge on average each day unless it is a massive desk/operation.... Those kind of swings in position though are actually a lot less than I would expect at a typical trading desk at a BB (quite typical, if not on the lower end, for many prop option MM desks).
All in--from bid-ask spread and market swings. When you say edge, i assume you mean bid-ask spread, but you also don't understand how wide these spreads can be for OTC products. I've seen a CMO trader make 200K in a single transaction with absolutely no risk because he had the buyer and seller lined up. While that instant 200K isn't common, it isn't exactly rare. Even in more liquid products, size helps PnL. A guy might make 25K on a large order. Do that a few times a day, plus some smaller ones and you can see where people get higher PnL.
I'm coming from a world where you're M2M every day and you have position PnL based on a book you may hold, but also PnL from trades that day. I know there are BB flow traders that are essentially just scalping and collecting spreads--that's not really what I'm asking about. I am asking if the swings you are referring to are from positions/portfolios or PnL generated from that particular day's trading from an individual or small group (2-4 people). I just wanted to hear a bit about what is typical where you are--it would be interesting to compare. I've heard plenty of stories of the exceptional instances from my firm and many others, so that isn't really what I'm interested in TBH.
I seen a 440k deal this year...
12mm and ive heard of bigger days
heard of 140+ mio
i am not sure if your talking about sell-side or buyside but a 500k day is not a tremendous amount if your talkiing about a hedge fund trader/PM managing hundres of millions or even billions of dollars. Just do the math on someplace like Brevan Howard with 30bn under management...firms like this do have 1-2% days.
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