PhD in Math - Made a huge mistake. BB -> HF

Hello Everyone. 


Forgive me. English is to my first language. 


I was super stupid. I ended up getting a "quant" role at a bank in the UK. It starts in the summer and I have some flexibility about which desk I'll be put on. I have a PhD in Math from a very good university in Paris. I wanted to move to London. So I thought I should become a quant as I spent some time in a bank in-between Masters and PhD and enjoyed it. I enjoy programming and math.


The reason I was stupid was I thought that all "quant" roles were essentially the same. Obviously, reading this forum has made me realise that was incorrect.



I want to discuss three options I am thinking about in the future. 

Option 1) is to go to a hedge fund and try to be a quant there. How feasible is this? What are the best things to do in a BB to make this option as likely as possible? 

Option 2) is to stay as a quant type role in a bank. Quant research is quite fun. What does a career look like in the option? From those who have experience in BBs, should I try and become a trader? Should I stay in a QR role?  

Option 3) is to stay in a BB and become more "corporate". Essentially become a manager of people etc. How does one progress from a Quant type role to head of FX for example? I've realised a lot of the big bosses at banks tend to have MBAs and such. Does this mean that quants typically don't progress much to these roles? Is it normally the folks in IB like M&A? 
 

Thank you for reading. 

 

I don’t think desk heads often have MBAs, Ik IBD it’s more common. You could apply to other places like Jane Street, Optiver etc for quant research/trading if you want to when they have open positions. Just apply as a lateral; BB trading is extremely limited due to Volcker. If you’re wanting to make the most money then QR at prop shops like Jane street and Citadel Securities is the way to go.

 

Hard for anyone to have any opinion. You need to do some homework on what these roles actually are, and then think about yourself and what you like and are good at- within the quant space.

 

I've looked a bit into the quant space. Generally speaking, it should be pretty feasible for you to get a quant research role at a trading firm like HRT, Two Sigma, Jane Street, or Citadel Securities since you have a PhD in Math. I also think it's the best option because sometimes you get treated like second class citizen as QR at BB banks (experiences differ widely). A firm like Two Sigma was built by engineers for engineers; they have a techy culture. So if you enjoy that type of culture I would 100% go for that opportunity. 

It's not uncommon for smart people with PhDs in STEM to be unaware of the different roles in finance as they are focused on their subject matter. This can be your "story" for later interviews. Again, these quant trading firms are looking for top talent in math/computer science, so your knowledge in that area would be much more important.

Also try networking with these people at academic conferences. The first time I heard about HRT was at the NeurIPS (Neural Information Processing Systems) 2020 conference, and they were doing a presentation on transfer learning in financial markets.

 
Most Helpful

U need to decide if u prefer bank or HF. Quant research is different.

Bank : more chill, no pressure of performance as no one will trade ur strategies. Stability of job. Smooth career path. Your aim is to produce "nice" papers, show good results, innovate, it is not so far from academic research in fact.

HF: you develop strategies that are going to be traded. And your job is to develop profitable strategies. More pressure, more rewarding if u are succesful, very frustrating if not. Lots of practical stuff to consider between model/maths and reality. More attention to details. Be ready to work 6 months on a strategy and decide not to launch it.

 

With a phd you should be able to get a good spot at a HF. I would recommend that as quant research in bank is a bit different from HF, and better learn from a HF directly if u want to have a career on the buy side.

Be sure to understand what a trader does in a bank before going that way. Pretty different from quant research.

I think in general banks roles are more focused on research, whereas HF will be more applied: develop signals/strategies that can bring money to the fund

 

Hello fibaked842 - I think you are under-estimating the potential to lateral within your BB to a risk-taking job. Your background in Maths PhD can certainly help you land a seat on a trading desk within your BB if you "perform" well in your Quant job. I have seen IT guys join Algo FX trading desk, FX Structurers join the Structured Options Desk, etc. I think you should see first what your Quant role brings on a daily basis : which products are concerned, what is the direct application of your work (is the job directly linked to a specific trading desk), how close are you to the markets and to market data. Also, please disregard anyone mentioning that the Volcker Rule has banned prop trading so there is nothing left to do in a BB trading seat. If people were actually working for a BB, they'd know that 95% of all BBs trading desk prop somehow. And given your strong educational background, you can consider moving to cross-asset trading desk, exotic rates vol desk, etc. where it is not possible to flatten out your risk overnight so you necessarily carry your inventory and need to come up with strategies to be profitable. Of course, top-tier BBs will have a strong franchise bringing flows overall but do not disregard the potential for prop trading / coming up with strategies when looking at BBs trading desks. I can give you a rundown of specific desks if you want.

Regarding HFs, the scope is broad in terms of role given your background (PhD in Maths). I would say litterally any type of systematic-driven HF is open to you and the role would probably look like being a Quant developing strategies back-test, analyzing data, researching models. The scope of products is large, i.e. it can be a FXO HF where the math component is important to some macro pod HF on a equity stat arb desk. Those guys can probably look at your profile without too much experience actually spent on a trading floor if your previous stint as a Quant and your current role lead you to build models/tools/systems directly applicable to a trading desk as this would show them your capacity to adapt directly to a specific product.

Coming back to market-making, the obvious place to check is electronic market makers such as Citadel Sec, Optiver, Jane Street, Flow Traders, Optiver, 2 Sigma who are big fan of PhD people in Maths.

There's a lot to say and add obviously but your PhD in Maths + Quant role look to me as a good profile to explore a diverse array of options whether in banks, HFs, or elec MMs.

"Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has" - Margaret Mead
 

Agreed - it is different indeed though I do believe people shouldn't dismiss the ability to "prop" on trading desks.

"Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has" - Margaret Mead
 

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