prop shop and a ton of questions please help
How legitimate is trading at prop shops? there are countless shops even among the better known ones for college kids (drw, sig, wolverine, jane street....).
do hedge funds or bank prop desks take people from prop shops? all of the lists I have seen of top paid traders are either traders at hedge funds or run hedge funds, never prop shops. why? are these jobs strictly inferior to trading prop at a bulge brack bank or hedge fund?
do these people learn the same trading techniques used at bulge bracket banks?
are the top shops as selective as bulge bracket banks? if so, why would people choose them over banks?
what is the salary? I have searched countless places and get nothing. no shit it depends on performance but could someone give some sort of range or average after a few years out of college? do good/above average traders earn 10 million or 100,000...? what is starting salary at the top prop shops first year out and do you get a bonus the first year (do you start trading first year?)?
on a related note:
what is the deal with being an execution trader? do they have a lot of freedom with a huge PnL or are they just trying to listen to their bosses and get shit on the cheap? are they less important/lower paid than the people who generate ideas?
what products do hedge funds commonly trade (in the sense that you need discretionary "traders"). I have heard macro type things but what else? does places like SAC capital have equity derivatives, credit, interest rate derivatives,etc etc "traders"
thanks
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There are too many variables
There are too many variables across prop shops to lump them into one category like banks.
do hedge funds or bank prop desks take people from prop shops? all of the lists I have seen of top paid traders are either traders at hedge funds or run hedge funds, never prop shops. why? are these jobs strictly inferior to trading prop at a bulge brack bank or hedge fund?
People hire whoever they want. However, if you have a proven strategy, why would you want to go work for someone else? It's alot easier to make trader monthly's lists though a 10% return on $1B AUM than somebody trading a significantly smaller stake/ their own capital. Not that it matters with the kinds of numbers that fund managers are putting up now, but we aren't allowed to talk to anyone outside our company about performance.
do these people learn the same trading techniques used at bulge bracket banks?
By nature of the business, prop guys are not gonna have any experience with flow trading institutional clients 100,000 share orders. Strategies come and go. Past performance is not indicative of future results at a bank or a prop shop.
are the top shops as selective as bulge bracket banks? if so, why would people choose them over banks?
Several prop shops are recruiting at many of the same schools that banks do. It is a completely different culture/ hierarchy/ career path. They tend to attract different types of candidates.
what is the salary? I have searched countless places and get nothing. no shit it depends on performance but could someone give some sort of range or average after a few years out of college? do good/above average traders earn 10 million or 100,000...? what is starting salary at the top prop shops first year out and do you get a bonus the first year (do you start trading first year?)?
Not all places pay a salary...I would tend to stay away from these though unless you really don't have any other options. $42k to start, salary capped at $60k by end of first year, bonus depends on your contribution to the bottomline/ group performance. I started trading after working at my firm for 5 days, but much of our training is experiential vs. classroom.
what products do hedge funds commonly trade (in the sense that you need discretionary "traders"). I have heard macro type things but what else? does places like SAC capital have equity derivatives, credit, interest rate derivatives,etc etc "traders"
What don't they trade? Some places tend to be focused on a particular expertise, whereas others have multiple strategies in various portfolios from the same fund.
Hey trig, can you really
Hey trig, can you really make 200k your first year? Do you keep a certain % of profit or do they just throw you a bonus based on how the market is?
you can make 400k your first
you can make 400k your first year. I know people that have!
trade4size, do you know what
trade4size, do you know what the typical compensation structure is for a shop like trillium?
What kind of skillset are
What kind of skillset are they looking for in prop-shops? Heavy quant skills? Kids who rock the brainteaser questions?
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www.conveniencesoftware.com
guimion- I have a vague idea
guimion- I have a vague idea how it works, but i think really your focusing on the wrong thing. If you are a good trader you will make a lot of money, THE END.
convenience software- no unless your talking about jane street then yes. Most prop traders employ a short term approach that they have some sort of proven edge in. I would say as far as skill set they want driven hungry people that want to make a lot of money. People that are comfortable taking risks, able to quickly do simple math in their head is also critical.
Trig, you in marketmaking or
Trig, you in marketmaking or true prop?
You trading firm's strat or your own?
Have you put any $ down at all so far?
Thanks.
Quote: Hey trig, can you
Hey trig, can you really make 200k your first year? Do you keep a certain % of profit or do they just throw you a bonus based on how the market is?
We're under a discretionary arrangement until we start our own groups, so you don't really have much of a direct claim during those first 18 months. The heads of my book have to balance keeping us happy without overpaying. What I am given comes directly out of their bottomline.
What kind of skillset are they looking for in prop-shops? Heavy quant skills? Kids who rock the brainteaser questions?
Trade4size was on point. Definitely being able to think quantitatively about problems/ answer brainteasers helps...we're looking for intelligent people. More than anything though, I'd say having a passion for markets is the only way you're gonna survive. Starting out is tough...I don't do anything outside of work during the week anymore: 12hrs in front of a screen, more time reading analyst commentary, more time reading/ researching new strategies or products. I'd recommend the "Heard on the Street: Quant Questions from Wall St Job Interviews" by Tim Crack. I've had questions taken directly from this book in several interviews when I was recruiting.
Trig, you in marketmaking or true prop?
You trading firm's strat or your own?
Have you put any $ down at all so far?
Firms strat: High frequency that's a combination of marketmaking and relative value. Most of them are based on the idea of recursion. Everybody has their own spin on the basic idea...I trade differently than my bosses do, but since its their money, I try to limit our portfolios exposure and finance the losers with winners intraday. I have not had to contribute capital. After paying your dues working for others, the firm will stake you via equity you've built up through your bonus account (its your money, but the larger the equity, the larger your rope).