What I Look For When Hiring Junior Traders

BOTT1702's picture
Rank: Gorilla | 505

What makes a successful junior trader?

I've been asked before what it takes to get a junior trader role on my desk, and there seems to be a prevalence of topics on the forums about how to secure a job as a junior trader. Having once been a junior trader, and now having hired and trained a few throughout my career, I feel fairly qualified to answer that question. When I'm interviewing candidates, these are the things that I'm looking for. This list is likely not comprehensive since each candidate is unique and each interview is different, but when I think about the ideal candidate, this is what I picture. Others may have different opinions and I can't guarantee that this list will get you a job, but here you go:

The Ability to Work Independently

There are certain things I can teach you and certain things I can't. How to look at markets and make the right decisions, how to handle common problems, how to execute properly--these are things that I can teach. What I can't teach is your ability to operate independently in an environment that requires the ability to think fast, make decisions, and take responsibility for your decisions. If I give you something to do, I don't want to have to check in on you every 30 minutes to make sure you're doing it. I just want it done.

You Fit in Well With the Team

As much as you need to operate independently, you also need to fit in with the desk. The dynamic on every desk I've worked on is very family-like--you have to be able to disagree and be in conflict while at the same time still respecting and getting along with everyone. If I bring you on board, I'm bringing you into that family dynamic. I'm not expecting you to fit into the dynamic right away, but I do want to know if your personality can handle that type of environment.

You Have Strong Math and Excel Skills

I'm not going to ask you to do calculus in your head, but I need people who can quickly do conversions from metric tons to short tons to bushels to pounds and back again without having to look up what the conversion rates are or look at charts. If you have a customer who's bidding in bushels and our pricing is in metric tons, you better not book it and have me find out later that you didn't do the math right. The same goes for being able to quickly calculate freight costs--you need to know how much product goes into each type of conveyance for twenty or so different products.

The same goes for Excel skills. You don't need to be a genius, but we do a huge amount of work in Excel to keep track of our freight spreads, shipment schedules, control sheets, and positions. Some of your first tasks on the desk will be keeping track of those spreadsheets, updating them, and sometimes rebuilding them. I don't have time to teach those skills to you.

You Can Handle Being Overwhelmed at Work

I call this the fire hose analogy--the amount of information I'm going to give you is like me turning on a fire hose and shooting it at you full-blast. You don't have to take everything in all at once, but you do need to catch some of it each and every day. You will be overwhelmed, likely the majority of the time. You have to be willing to accept the fact that you aren't going to know everything about everything right away and not let that scenario burn you out.

You Demonstrate Integrity at Work

I don't ever want to catch you lying to me, one of our customers, one of our suppliers, one of our freight carriers, management, or anyone. I don't ever want to catch you drawer trading. I don't ever want to hear that there is even an inkling of a question about your reputation in the marketplace. I'm placing a huge degree of trust in you--I'm giving you the opportunity to interact with counterparties whose relationships have been carefully cultivated and maintained. I have to trust that you'll treat these people with honesty and integrity. If you give me any reason to question your integrity in the interview process, I'm not hiring you.

You Realize You Know Very Little and Want To Learn

I have yet to come across any penultimate resource or combination of resources that can teach you how to trade physical commodities short of spending time on a trading floor and learning from the people around you. Although there are some excellent texts on the theory and basis of ag trading and physical trading in general, there is absolutely zero substitute for experience. I don't expect you to come in knowing all the answers, jargon, and buzzwords. I'm looking for people with an actual interest in the industry who want to take the time to learn the right way--slowly and one step at a time.

Owning Up to Mistakes

You will impress me more during the interview if you can share a genuine story of a time you took a risk, failed, and learned something from it than you will by telling me how smart and amazing you are. I know you are going to make mistakes--what can't tell from your resume is how you're going to react to making them. My two biggest fears when I bring you onto the desk are that you will make mistakes and be paralyzed by failure, or that you will make mistakes, not learn from them, and make the same ones over and over again. I have to be convinced that you won't fall into either of those two categories if I'm going to hire you.

Hopefully this helps some of you who are trying to break into the business. Contributions to the list are always welcome from my peers in the industry, as is any feedback from recent candidates. Good luck to all of you who are seeking positions in the industry--we're always looking for talented people.

Mod Note (Andy): Throwback Thursday - this was originally posted 3/11/14

Comments (52)

Mar 11, 2014

Thanks for the writeup. Questions:

1 - If someone didn't get into S&T after college and is getting an MBA, would you take them on as a junior?

2 - As a followup, is age a dealbreaker? I keep hearing that trading desks want people in their early 20's. What about people that want to change directions?

3 - What are your long term plans?

4 - Do you view trading as a job, as a money making thing, and do you enjoy the work enough to stay after making a lot of money?

Mar 11, 2014

1. No, I wouldn't discriminate against someone who came to the industry late or had an MBA and would consider that person for a junior role. I think the hardest part for someone coming in this way would be the sense of starting over--you really do have to start from the bottom and earn your way up, and I think that can be hard for someone who's been further up the ladder before.

2. I have seen people out of their 20's transition into physical trading. Usually these people have some type of financial trading/risk management/logistics background so there are some immediately transferable skills. They also rarely start in a true "junior" role because of this. However, as with the above, you need to have the right person who is open to learning and can truly start over and go through the process again.

3. Get married, have a family, and continue building the wonderful career that I already have.

4. I enjoy the work and see no reason to leave. I play a global chess game every day, and that suits me well.

    • 1
Mar 11, 2014

That's awesome, glad to hear you like it. I'm really interested to perhaps jump to trading at some point, so this is good to know. Also: I thought this thread would be more active, I'm going to see if I can get the mods to front page it.

Mar 11, 2014

@"UFOinsider" appreciate the feedback. This post was scheduled to hit the front page sometime today or on Thursday--looks like it went today. I'm glad someone managed to find it before it was officially published.

Mar 11, 2014

II have couple questions for you:
1) How often do you interview candidates who are from non-target schools or have no finance background?
2) Do you interview candidates who are selected by recruiters/headhunters or candidates who you know through your network? If yes for both, what's the percentage in each?

Thanks!

"Never settle for less"

Mar 11, 2014

I'm going to caveat this and all future responses regarding who gets interviewed by saying that I work in ag trading and I know that energy and metals operate differently than this. If you want to be in those fields, take all my advice with a grain of salt.

1. I've interviewed from a wide variety of backgrounds. The big ag companies interview at most major Midwest schools, especially at schools that have ag merchandising coursework.

2. I've never been in HR so I usually don't know where candidates come from. That said, the headhunters I've worked with in my career usually have no interest in speaking to someone with no industry background and are usually filling experienced roles.

Mar 16, 2014
BOTT1702:

I'm going to caveat this and all future responses regarding who gets interviewed by saying that I work in ag trading and I know that energy and metals operate differently than this. If you want to be in those fields, take all my advice with a grain of salt.

1. I've interviewed from a wide variety of backgrounds. The big ag companies interview at most major Midwest schools, especially at schools that have ag merchandising coursework.

2. I've never been in HR so I usually don't know where candidates come from. That said, the headhunters I've worked with in my career usually have no interest in speaking to someone with no industry background and are usually filling experienced roles.

metals tends to be clubbier, I know a lot of 2nd, 3rd and even 4th generation traders...

Mar 11, 2014

@"BOTT1702" First off, thanks a lot for contributing your time on this site. This thread was very helpful and a great read, much appreciated.

I am interested in getting into a full fledged trading role, whether it be as a junior trader or some other title. I am currently working as a commodity analyst, but my role is pretty evenly split between macro market analysis/correlation studies/model buidling (energy risk management) and assisting with trading for the firm (technical analysis, etc.)...

In terms of resume/networking/interviewing, I am curious as to how I can make these experiences seem "most transferable," if that makes sense.

Also curious about your experiences working with/hiring former college athletes? Being a former athlete, pretty much everything you just wrote resonates well with me and makes me think that trading would be a great career for me.

Thanks, again!

Mar 11, 2014

I've never worked with a former college athlete (that I know of) so I can't speak to that. As far as tweaking your resume, I rarely view resumes directly (usually just before meeting a candidate) so this advice may not be spot on. However, if I were screening resumes, I'd be looking for specific examples of when you took initiative to improve a process, found a correlation that improved profitability, designed a new and better model...anything that shows that you can take initiative and get things that matter done.

Mar 13, 2014

Thanks a lot @"BOTT1702". Just caught up with this thread and would also like to thank @"jesus of nazareth" for your perspective, as well. Always a treat to receive insight and advice from the vets who have been around the block. Beauties.

Mar 11, 2014

@"BOTT1702" Thanks a lot for the information. May I ask a few questions :

1) Do you mainly recruit junior traders through graduate programs ? Would you be willing to recruit gap-year interns for trader assistant positions ?

2) How close are you from the commodity specific freight department ? What are the differences between traders and schedulers in terms of exit ops/wages ?

3) Does your job requires travels to suppliers/own assets mines and exploitation?

Thanks a lot

Mar 11, 2014

1. Almost everyone I've interviewed has come through an HR process first, with only a couple of exceptions. I have interviewed interns before, but none of the companies I have worked for have a specific intern program and I've been looking to fill a very specific need for the summer. Most of these people are referrals to me. The big houses have specific internship programs that are highly competitive.

2. My desk handles its own freight, which is not uncommon in the grain business. We have a freight department but I don't lean on them too heavily--this varies from group to group and company to company. Bigger houses have centralized freight departments to handle truck, rail, and barge freight, and most have barge freight and rail freight trading desks. In general in grain/ags, traders do much better than logistics.

3. My current role requires me to travel roughly 15-20% of the time to visit counterparties and assets that we may be interested in utilizing. Junior roles generally do not require much travel if any.

    • 1
Mar 11, 2014

This is an incredibly helpful post. I genuinely appreciate the candidness with which it is written. Many posts of this nature relay the same information in different ways, but this one is different. It is reassuring to heard that junior level traders are expected to know very little. I am highly aware that I have no background in finance, but firmly believe my mentality would make me successful in the industry.

Mar 11, 2014

Good article. What is drawer trading?

Mar 11, 2014
Going Concern:

Good article. What is drawer trading?

Curious about this as well

Mar 11, 2014

Drawer trading is the act of making a trade and not booking it into the system--in the old days, traders who did this would stick the contract in one of their drawers to keep it hidden, hence the term drawer trading. Less common these days because the industry is becoming more streamlined and efficient, but when dealing with smaller counterparties or farmers who don't issue their own confirmations, it can and does happen.

    • 1
Mar 11, 2014

Hey, thanks for the thread. However, this strikes me as being more relevant to a person who is going into an interview and already has a shot.

Any thoughts on how to get the chance to even get in front of someone who is hiring? Especially when you do not have the advantage of on-campus recruiting or connections on your side? - I know all the generalized tips, but from your experience, what approach would be the best use of time? (Cold-calling, online applications, networking, showing up at the front door, sending a fruit basket, etc.) From someone trying to break into (energy) trading in a junior trading role, even applying to 5+ jobs a day gets barely any responses at all.

Mar 11, 2014

No idea how to break into energy trading, so I can't help you there. I prefer to not receive cold e-mails or calls and would rather have someone connect with me on LinkedIn.

On the grain side, if you can't get into a merchandiser training program and are willing to be flexible with relocation, spend some time looking at country elevator operations roles. These tend to be less competitive because of their locations, you usually get to work with a very experienced manager who has seen a lot, and the opportunities for upward movement or exit ops are very good if you're smart and work hard.

Mar 11, 2014

Great post!

Mar 12, 2014

Thanks for your reply I appreciate.
Your job looks very very interesting

Mar 13, 2014

Thank you for your response and for taking the time to do this. Naturally, most monkeys are eager to get into trading and are confident in their abilities to succeed.
1) Is there anything you have seen in your time in soft commodities that has given you a sense for the type of people/background that will do well?
2) Does PnL get zeroed at year end? Like the $1.2M hit you took.

Mar 13, 2014
yankeegooner:

Thank you for your response and for taking the time to do this. Naturally, most monkeys are eager to get into trading and are confident in their abilities to succeed.

1) Is there anything you have seen in your time in soft commodities that has given you a sense for the type of people/background that will do well?

2) Does PnL get zeroed at year end? Like the $1.2M hit you took.

1. I've seen a diverse group of backgrounds and personality types succeed in trading, and I've seen a diverse group of backgrounds and personality types fail. A huge part of your success in softs is finding a firm that fits your personality style--you need to "fit in" with the culture of the firm. That said, when you're just starting out, you usually don't have multiple options, so you need to be able to keep your head down and learn.

2. Generally, yes, your P&L is zeroed at the end of the year. At most firms your bonus is calculated on your year-end P&L, though not always (for example, if you're merchandising byproduct out of a plant, the cost of goods on your inventory is usually credited to the finished product, meaning you have zero-cost inventory and therefore are always profitable--hard to pay bonus off of that type of P&L). There are firms that are essentially "prop shops" of physical trading--these firms generally zero your P&L monthly and give you a fixed payout off of your month-end profits.

Mar 13, 2014

Great post. Though I agree that each desk has its own personality, mostly because of the senior trader.

Generally I make a decision whether or not a candidate is a fit within the first 3 minutes during an interview. In my opinion, "you fit into the team", "you can handle being overwhelmed", "you have integrity" and "you realize you know very little and want to learn" are the first things I look for in a candidate. Particularly "you realize you know very little". I think it's been talked about much less, and most kids have the tendency to "show off" what they know (or what they think they know) in an interview. Then I try to determine how competent a person is and if he can actually get work done.

Best Response
Mar 13, 2014
jesus of nazareth:

Great post. Though I agree that each desk has its own personality, mostly because of the senior trader.

Generally I make a decision whether or not a candidate is a fit within the first 3 minutes during an interview. In my opinion, "you fit into the team", "you can handle being overwhelmed", "you have integrity" and "you realize you know very little and want to learn" are the first things I look for in a candidate. Particularly "you realize you know very little". I think it's been talked about much less, and most kids have the tendency to "show off" what they know (or what they think they know) in an interview. Then I try to determine how competent a person is and if he can actually get work done.

I agree about the "show off" tendency. I don't think I've ever asked a candidate about anything industry related during an interview other than why they want to be in this field or what they did at their internship if they have relevant work experience. I'm not hiring a junior trader for their market knowledge, I'm hiring them because I see in them the ability to work hard, learn, contribute, and fit into the group. I wish more candidates would spend time working on their "soft" skills that would help them in those areas.

    • 2
Mar 13, 2014
BOTT1702:
jesus of nazareth:

Great post. Though I agree that each desk has its own personality, mostly because of the senior trader.

Generally I make a decision whether or not a candidate is a fit within the first 3 minutes during an interview. In my opinion, "you fit into the team", "you can handle being overwhelmed", "you have integrity" and "you realize you know very little and want to learn" are the first things I look for in a candidate. Particularly "you realize you know very little". I think it's been talked about much less, and most kids have the tendency to "show off" what they know (or what they think they know) in an interview. Then I try to determine how competent a person is and if he can actually get work done.

I agree about the "show off" tendency. I don't think I've ever asked a candidate about anything industry related during an interview other than why they want to be in this field or what they did at their internship if they have relevant work experience. I'm not hiring a junior trader for their market knowledge, I'm hiring them because I see in them the ability to work hard, learn, contribute, and fit into the group. I wish more candidates would spend time working on their "soft" skills that would help them in those areas.

I agree. I actually ask them to do an exam before the interview. But the goal is not to test their knowledge, but to get to know how they think and react under stress. The exam usually is very difficult. I met kids who thought it was "easy" but ended getting zero question right.That's the worst, obviously. I'd appreciate someone who acknowledges the difficulty and asks for directions. This is very important, because on the job, you'd want someone who's not afraid to ask when not sure than someone who pretends to know everything and fucks everything up.

Mar 13, 2014

Great sum-up of good trading attitude.

Mar 13, 2014

I'm on the energy side, and a little bit of ag side particularly if you are buying renewable blending components, but BOTT1702 is spot on in terms of what is expected from junior traders.

Mar 13, 2014

What would you to say to someone slightly weak in Math trying to break into a trading role?

Mar 13, 2014
JohnDoe11:

What would you to say to someone slightly weak in Math trying to break into a trading role?

Depends on how weak. We're not talking high-level math here--if you can't handle addition/subtraction/multiplication/division, you probably aren't going to get on the desk. I'm not even saying you have to do this stuff in your head, but you need to be competent.

Mar 14, 2014
JohnDoe11:

What would you to say to someone slightly weak in Math trying to break into a trading role?

It all depends on the desk you're on. Some of the desks are extremely qualitative. As long as you are logical and can do basica math it should be fine.

    • 1
Aug 17, 2016

Could you give some examples of what those desks might be?

Mar 13, 2014

Awesome post!

Mar 14, 2014

Just to throw this in the mix: to what extent can your jobs be replaced by computers? The faux consensus with people outside of trading is that computers will take EVERYTHING over, and I'm sure you've heard this as well. Personally, I don't see that every job can be done by a computer, and that the people positing this don't understand exactly what it is you do. I saw an earlier topic addressed in an earlier comment above but I wanted to be more specific: would you care to speak to this?

Other question: how hard IS it to break into your sector? Is it a function of pure work ethic, college 'prestige', grades, connections, experience? Or is it more a function of interest, work ethic, and fit?

Also: how scalable are your operations? Compared to something like bond trading that is (theoretically at least) infinitely scalable, how concentrated can your sector become?

Corollary: how profitable is your sector? Are seven figure bonuses/payouts being tossed around on a routine basis? More? Less? Just trying to get a feel for the ballpark pay.

Mar 14, 2014
UFOinsider:

Just to throw this in the mix: to what extent can your jobs be replaced by computers? The faux consensus with people outside of trading is that computers will take EVERYTHING over, and I'm sure you've heard this as well. Personally, I don't see that every job can be done by a computer, and that the people positing this don't understand exactly what it is you do. I saw an earlier topic addressed in an earlier comment above but I wanted to be more specific: would you care to speak to this?

Other question: how hard IS it to break into your sector? Is it a function of pure work ethic, college 'prestige', grades, connections, experience? Or is it more a function of interest, work ethic, and fit?

Also: how scalable are your operations? Compared to something like bond trading that is (theoretically at least) infinitely scalable, how concentrated can your sector become?

Corollary: how profitable is your sector? Are seven figure bonuses/payouts being tossed around on a routine basis? More? Less? Just trying to get a feel for the ballpark pay.

1. At my desk, we use a combination of automated and manual execution strategies. Though I don't see how computers can completely takeover. Many people talking about this probably do not have much experience with algo trading/hft so I would take that with a whole shaker of salt. I don't know enough about other strategies to comment on it, but for what we do, at least for the foreseeable future, I don't see this happening. Computers can only execute orders, and are not the most efficient thinking complex problems (at least in the world we currently live in). True, machine learning - but it's okay for facebook to suggest an ad you're not interested in, but NOT okay for an algo to execute a trade that could cost you millions. Many opportunities that do not follow a "if... then..." pattern might be exploited only through manual strategies. Not sure if I've explained myself well.

2. I assume you were asking about the recruiting process? We do OCR at the top universities. So the process is pretty similar to that at the banks. With the final rounds, different desks do it differently. I always put together an exam. But like I said, the goal is not to test your knowledge, but rather how you think/react/carry yourself/etc. I pay less attention to previous experience, but more attention to your work ethics. Fit is also very important, because if you don't get along with the other guys at the desk, everyone would end up being miserable. Grades? Yes and no. 4.0 GPA does not equal intelligence. But 2.0 would definitely tell me something about you. The recruiting process can be kind of hit and miss. It's important to get first rounds (through strong resume or networking) and then you just need to outshine other candidates.

3. I honestly do not have a "set" strategy or philosophy, neither do I limit myself to a particular product. I don't quite get what you mean by "scalable". I think the universe of potential opportunities is tremendous and I focus on identifying those opportunities.. My priority is to make use of what I know and try to learn as much as possible at the same time.

4. Traders take a percentage of what they bring in. I don't want to give out too much detail on comp, but depending on your firm, I don't think it's too hard to achieve the number once you're senior enough.

Mar 15, 2014
UFOinsider:

Just to throw this in the mix: to what extent can your jobs be replaced by computers? The faux consensus with people outside of trading is that computers will take EVERYTHING over, and I'm sure you've heard this as well. Personally, I don't see that every job can be done by a computer, and that the people positing this don't understand exactly what it is you do. I saw an earlier topic addressed in an earlier comment above but I wanted to be more specific: would you care to speak to this?

Other question: how hard IS it to break into your sector? Is it a function of pure work ethic, college 'prestige', grades, connections, experience? Or is it more a function of interest, work ethic, and fit?

Also: how scalable are your operations? Compared to something like bond trading that is (theoretically at least) infinitely scalable, how concentrated can your sector become?

Corollary: how profitable is your sector? Are seven figure bonuses/payouts being tossed around on a routine basis? More? Less? Just trying to get a feel for the ballpark pay.

1. I don't think this job is replaceable by computers anytime in the near future. You really can't automate relationships, which are the most critical function of physical trading. There is also too much variety in the marketplace--this isn't like buying stocks or futures, where everyone agrees on standardized contract specs. You're dealing with counter-parties that have their own opinions about what matters for their operations. I just don't see how computers could take over this type of negotiation process. That being said, there are ways computers can streamline the process and create greater market efficiency, but we're an industry that is slow to adapt to those changes.

2. This depends on where you're trying to go. If you really want to start at the ground-level, it's not terribly difficult to get a job working in the middle of nowhere at a country elevator and learn operations. The problem with that is, there's no guarantee that you can move that experience into a trading role without having 5-10 years of being in operations. The same is true if you try to start in a logistics role. You really need to network in either one of those roles so that doors open for you. If you're looking to get into a junior trading track right out of college, the process is competitive as there are only so many spots and you have some people from ag schools that take specific coursework that give them a leg up on those tracks. All that said, I don't think the ag business is as hard to get into as other physical fields, simply because there are multiple options to get experience on the trade side of things.

3.In theory you're book size is limited to the amount of physical product that you can procure and ship. In some markets, there isn't much product to go around, so you have to decide what's going to be in demand during a certain crop year and what isn't. Obviously for things like grain, there's carry-out at the end of the year, whereas a market like canola meal or cottonseed can run into shortages before new-crop. You see most guys end up specializing into a particular product group, but it really depends on the size of the firm and what you're asked to do.

4. You eat what you kill, so while 7-figure bonuses do happen, they aren't just doled out.

Mar 14, 2014

@OP I appreciate the insightful post. I strongly agree with the comment on 'fitting in' to a desk's culture being key to success in any role as a junior.

I gained an interest in ag trading after interning in the back office team of a commodities firm (got on pretty well with the ag team-sugars especially). The rather simple ag trading strategies like soy bean crush spreads seemed refreshing to me relative to trading other asset classes.

Purely out of curiosity, what drove you into ag trading to begin with, and did you have any alternative options available to you when embarking on your career?

Cheers

Mar 15, 2014
curiouskoala:

@OP I appreciate the insightful post. I strongly agree with the comment on 'fitting in' to a desk's culture being key to success in any role as a junior.

I gained an interest in ag trading after interning in the back office team of a commodities firm (got on pretty well with the ag team-sugars especially). The rather simple ag trading strategies like soy bean crush spreads seemed refreshing to me relative to trading other asset classes.

Purely out of curiosity, what drove you into ag trading to begin with, and did you have any alternative options available to you when embarking on your career?

Cheers

I had other options available to me at the time, and honestly the trading role that I took was by far the worst offer I had for immediate comp, so I did have to think about whether or not this was something I wanted to do. I actually had no intention of going into ag trading and fell into it almost accidentally. I'll probably save that story for an upcoming AMA/interview.

Mar 15, 2014

Great post! Thanks. Just a quick question: how much time do you spend between market making and taking client orders vs prop trading where you trade the bank's money? I'm more interested and passionate about the latter rather than the former.

Mar 16, 2014

If you can't tell this guy is not a market-maker at a bank you should bone up on your reading skills before thinking about getting into trading.

Mar 16, 2014
terminator:

Great post! Thanks. Just a quick question: how much time do you spend between market making and taking client orders vs prop trading where you trade the bank's money? I'm more interested and passionate about the latter rather than the former.

@"GoodBread" is correct, I don't work for a bank and I don't do the type of work you're asking about. There are plenty of great resources on prop trading on this board but I'm not one of them.

Sep 6, 2015

Deleted!

Mar 16, 2014
vinbweb:

I'm a sophomore at a complete non-target university (on the west coast, at that), decent GPA, with no relevant work experience yet. I come from a "gaming" type background (I made money off of being competitive at computer games).

I visited my sister in NYC about ~6 months ago, she works at a hedge fund, and I found out about trading; ever since I have been fascinated. My gaming background translates well in that I can see the correlation on so many levels; even the things you mentioned on that list are all things gaming competitively has helped me hone. I have read several books, I'm educating myself outside of school via internet as well, and I'm soon to open my own trading account. I am really beginning to love this stuff and I want to make something of it.

But I am at a disadvantage. I won't graduate until I'm 25, and my school is a complete non-target. But I don't want to give up; I want to get ahead as much as I possibly can right now as I still have time before I graduate. Please, tell me ANYTHING and everything I should be doing so that I can do to put myself in the best position possible to break in. I want this more than you could ever know!

If you're looking to get into a hedge fund, I can't give you any advice, as I'm not involved in the financial world. If you're looking at physical trading, there are actually quite a few companies with offices in California (Central Valley is a huge agricultural center and you have plenty of import/export coming through LA and Long Beach). Being from a non-target is not an issue in ags.

Mar 16, 2014
BOTT1702:

I've been asked before what it takes to get a junior trader role on my desk, and there seems to be a prevalence of topics on the forums about how to secure a job as a junior trader. Having once been a junior trader, and now having hired and trained a few throughout my career, I feel fairly qualified to answer that question. When I'm interviewing candidates, these are the things that I'm looking for. This list is likely not comprehensive since each candidate is unique and each interview is different, but when I think about the ideal candidate, this is what I picture. Others may have different opinions and I can't guarantee that this list will get you a job, but here you go:

You Can Operate Independently

There are certain things I can teach you and certain things I can't. How to look at markets and make the right decisions, how to handle common problems, how to execute properly--these are things that I can teach. What I can't teach is your ability to operate independently in an environment that requires the ability to think fast, make decisions, and take responsibility for your decisions. If I give you something to do, I don't want to have to check in on you every 30 minutes to make sure you're doing it. I just want it done.

You Fit Into the Team

As much as you need to operate independently, you also need to fit in with the desk. The dynamic on every desk I've worked on is very family-like--you have to be able to disagree and be in conflict while at the same time still respecting and getting along with everyone. If I bring you on board, I'm bringing you into that family dynamic. I'm not expecting you to fit into the dynamic right away, but I do want to know if your personality can handle that type of environment.

You Have Strong Math and Excel Skills

I'm not going to ask you to do calculus in your head, but I need people who can quickly do conversions from metric tons to short tons to bushels to pounds and back again without having to look up what the conversion rates are or look at charts. If you have a customer who's bidding in bushels and our pricing is in metric tons, you better not book it and have me find out later that you didn't do the math right. The same goes for being able to quickly calculate freight costs--you need to know how much product goes into each type of conveyance for twenty or so different products.

The same goes for Excel skills. You don't need to be a genius, but we do a huge amount of work in Excel to keep track of our freight spreads, shipment schedules, control sheets, and positions. Some of your first tasks on the desk will be keeping track of those spreadsheets, updating them, and sometimes rebuilding them. I don't have time to teach those skills to you.

You Can Handle Being Overwhelmed

I call this the fire hose analogy--the amount of information I'm going to give you is like me turning on a fire hose and shooting it at you full-blast. You don't have to take everything in all at once, but you do need to catch some of it each and every day. You will be overwhelmed, likely the majority of the time. You have to be willing to accept the fact that you aren't going to know everything about everything right away and not let that scenario burn you out.

You Have Integrity

I don't ever want to catch you lying to me, one of our customers, one of our suppliers, one of our freight carriers, management, or anyone. I don't ever want to catch you drawer trading. I don't ever want to hear that there is even an inkling of a question about your reputation in the marketplace. I'm placing a huge degree of trust in you--I'm giving you the opportunity to interact with counterparties whose relationships have been carefully cultivated and maintained. I have to trust that you'll treat these people with honesty and integrity. If you give me any reason to question your integrity in the interview process, I'm not hiring you.

You Realize You Know Very Little and Want To Learn

I have yet to come across any penultimate resource or combination of resources that can teach you how to trade physical commodities short of spending time on a trading floor and learning from the people around you. Although there are some excellent texts on the theory and basis of ag trading and physical trading in general, there is absolutely zero substitute for experience. I don't expect you to come in knowing all the answers, jargon, and buzzwords. I'm looking for people with an actual interest in the industry who want to take the time to learn the right way--slowly and one step at a time.

You Can Make Mistakes and Own Them

You will impress me more during the interview if you can share a genuine story of a time you took a risk, failed, and learned something from it than you will by telling me how smart and amazing you are. I know you are going to make mistakes--what can't tell from your resume is how you're going to react to making them. My two biggest fears when I bring you onto the desk are that you will make mistakes and be paralyzed by failure, or that you will make mistakes, not learn from them, and make the same ones over and over again. I have to be convinced that you won't fall into either of those two categories if I'm going to hire you.

Hopefully this helps some of you who are trying to break into the business. Contributions to the list are always welcome from my peers in the industry, as is any feedback from recent candidates. Good luck to all of you who are seeking positions in the industry--we're always looking for talented people.

Fantastic post. I am currently hiring a jr trader for a physical desk for the first time, and will keep some of this in mind during the decision making process....

Mar 17, 2014
BOTT1702:

I've been asked before what it takes to get a junior trader role on my desk, and there seems to be a prevalence of topics on the forums about how to secure a job as a junior trader. Having once been a junior trader, and now having hired and trained a few throughout my career, I feel fairly qualified to answer that question. When I'm interviewing candidates, these are the things that I'm looking for. This list is likely not comprehensive since each candidate is unique and each interview is different, but when I think about the ideal candidate, this is what I picture. Others may have different opinions and I can't guarantee that this list will get you a job, but here you go:

You Can Operate Independently

There are certain things I can teach you and certain things I can't. How to look at markets and make the right decisions, how to handle common problems, how to execute properly--these are things that I can teach. What I can't teach is your ability to operate independently in an environment that requires the ability to think fast, make decisions, and take responsibility for your decisions. If I give you something to do, I don't want to have to check in on you every 30 minutes to make sure you're doing it. I just want it done.

You Fit Into the Team

As much as you need to operate independently, you also need to fit in with the desk. The dynamic on every desk I've worked on is very family-like--you have to be able to disagree and be in conflict while at the same time still respecting and getting along with everyone. If I bring you on board, I'm bringing you into that family dynamic. I'm not expecting you to fit into the dynamic right away, but I do want to know if your personality can handle that type of environment.

You Have Strong Math and Excel Skills

I'm not going to ask you to do calculus in your head, but I need people who can quickly do conversions from metric tons to short tons to bushels to pounds and back again without having to look up what the conversion rates are or look at charts. If you have a customer who's bidding in bushels and our pricing is in metric tons, you better not book it and have me find out later that you didn't do the math right. The same goes for being able to quickly calculate freight costs--you need to know how much product goes into each type of conveyance for twenty or so different products.

The same goes for Excel skills. You don't need to be a genius, but we do a huge amount of work in Excel to keep track of our freight spreads, shipment schedules, control sheets, and positions. Some of your first tasks on the desk will be keeping track of those spreadsheets, updating them, and sometimes rebuilding them. I don't have time to teach those skills to you.

You Can Handle Being Overwhelmed

I call this the fire hose analogy--the amount of information I'm going to give you is like me turning on a fire hose and shooting it at you full-blast. You don't have to take everything in all at once, but you do need to catch some of it each and every day. You will be overwhelmed, likely the majority of the time. You have to be willing to accept the fact that you aren't going to know everything about everything right away and not let that scenario burn you out.

You Have Integrity

I don't ever want to catch you lying to me, one of our customers, one of our suppliers, one of our freight carriers, management, or anyone. I don't ever want to catch you drawer trading. I don't ever want to hear that there is even an inkling of a question about your reputation in the marketplace. I'm placing a huge degree of trust in you--I'm giving you the opportunity to interact with counterparties whose relationships have been carefully cultivated and maintained. I have to trust that you'll treat these people with honesty and integrity. If you give me any reason to question your integrity in the interview process, I'm not hiring you.

You Realize You Know Very Little and Want To Learn

I have yet to come across any penultimate resource or combination of resources that can teach you how to trade physical commodities short of spending time on a trading floor and learning from the people around you. Although there are some excellent texts on the theory and basis of ag trading and physical trading in general, there is absolutely zero substitute for experience. I don't expect you to come in knowing all the answers, jargon, and buzzwords. I'm looking for people with an actual interest in the industry who want to take the time to learn the right way--slowly and one step at a time.

You Can Make Mistakes and Own Them

You will impress me more during the interview if you can share a genuine story of a time you took a risk, failed, and learned something from it than you will by telling me how smart and amazing you are. I know you are going to make mistakes--what can't tell from your resume is how you're going to react to making them. My two biggest fears when I bring you onto the desk are that you will make mistakes and be paralyzed by failure, or that you will make mistakes, not learn from them, and make the same ones over and over again. I have to be convinced that you won't fall into either of those two categories if I'm going to hire you.

Hopefully this helps some of you who are trying to break into the business. Contributions to the list are always welcome from my peers in the industry, as is any feedback from recent candidates. Good luck to all of you who are seeking positions in the industry--we're always looking for talented people.

Based on your descripiton I would be quite a good fit. Maybe that's the reason for being invited to come and visit a trader. Don't know whether I would like the job as a trader though. My idea about trading is that it's a quite monotonous job. You are actually doing the same every day. Correct me if I am wrong though.
What I would like to know, is what you like so much about trading? Once I have done a trading simulation, and I have to admit is was very challenging. Really felt the adrenalin of being under a lot of pressure. Is that what gives you traders their fulfillment?

Mar 17, 2014

Although there are certain tasks that come with the job that can be monotonous, my job doesn't involve doing the same things over and over. Physicals are very different than financials; you're not just responsible for buying and selling, you're also responsible for execution, ie, shipping, storing, blending of actual product. I work with roughly 20 different products on my desk, each with their own supply/demand profile, grade requirements, logistics challenges...add to that the problems of doing business in multiple countries and every day is different. My job fulfillment comes from navigating those waters.

    • 1
Mar 17, 2014
BOTT1702:

Although there are certain tasks that come with the job that can be monotonous, my job doesn't involve doing the same things over and over. Physicals are very different than financials; you're not just responsible for buying and selling, you're also responsible for execution, ie, shipping, storing, blending of actual product. I work with roughly 20 different products on my desk, each with their own supply/demand profile, grade requirements, logistics challenges...add to that the problems of doing business in multiple countries and every day is different. My job fulfillment comes from navigating those waters.

Thanks for your detailed explanation, makes a lot of sense. From what I heard, contact with clients is very important in the trading market. Do you also meet clients face-to-face or is that really something for upper management?

Mar 17, 2014

Great post (saying this as a former ABCD trainee) and a lot of it resonates outside of trading as well.

Regarding a lower starting salary, this is something that is virtually never discussed. The key thing to understand why a company who pays less initially (e.g. GS not paying out large bonuses in first year) is a BETTER choice so long as it's in the same league is the idea of promoting internally vs externally. Michael Church put it better than I ever could: http://michaelochurch.wordpress.com/2014/02/06/if-...

This is extremely strongly pronounced in ags (at least it was at my firm), where most people are grown from the ranks and promoted based on their time and experience. It takes some balls to implement this regardless of your industry because your lower offer (in terms of salary, but also title and perks) is going to put off a lot of candidates. But it truly results in the best work environments I've ever been in.

Apr 16, 2014

Super informative post! I'll definitely be taking this to heart...

May 24, 2014
Comment
Apr 18, 2018
Comment
Apr 18, 2018
Comment

Pages