Vitol posts $13B profits for 2023

I wonder what the salaries look like for quants and traders there? Recruiter reached out to me 6 months ago, but I didn't know they are such a big name lol (I am currently at big MM in equities).
https://www.cityam.com/trading-house-vitol-report

 

This also seems bizarre to me. How can a commodity trading company with 1000 employees be in the top 5 companies in the world right along with Walmart and Amazon? Also they are extremely secretive/shady. It seems like a scam.

 

It is not a scam have u seen the commodities prices ?

These guys main job is to buy commodities from all over the word and hope they will sell them later to higher prices.

They hedge a small part of it on the markets depending on the prices, but they have a huge long bias by design.

They don't have the limitations of the energy listed companies and can trade with anyone, including the most shady producers.
They sometimes negociate directly with governments and have a huge negociation power (or you can call it corruption too). Google Gunvor/Congo, or Gunvor/Pakistan to have an Idea of how they operate

 

Worth reading ‘The world for sale’ for an insight into how big these guys truly are. I have personally spoken to many big traders there and the comp is structured over three years in deferred so most big guys tend to stay there if they’re doing well (no funds can buy them out).

Wider risk limits than MM and capital can exceed a pod if doing well - not many push factors for these guys at all. Plus, partner can be made within a few years meaning they benefit off the overall firm’s profits YoY.

 

If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.

NEW YORK, Feb 23 (Reuters) - A former oil trader at Vitol, one of the world's largest energy trading companies, was convicted on Friday of corruption charges stemming from more than $1 million in bribes he paid to officials in Ecuador and Mexico to win business.

 

What’s inaccurate? Maybe the 50k is 70k but the point being is that high finance blows the entry level comp away

 

Still doesn't look like people in Switzerland, UK, and Europe are battling for these roles. At the junior levels, everyone wants to do IB/PE/HF and there is very limited interested in trading in general. The only exception are quants, but for traditional finance hopefuls commodities barely register (outside of bumper years like we have had since the pandemic). I do wonder why that is.

 

Entry level pay is really bad for physical commodities trading (think 70k for BP/Shell) so doesn't even register on the same league as IB/PE/HF jobs out of college. No guarantee you can become a trader either. I guess most of the interest in IB/PE especially is for the optionality, take that away + low upfront pay = all that's left is hope for a tail outcome 10 years in - gotta have a lot of conviction in the job to go down that path.

 
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I wouldn't view it so pessimistically. Shell is usually 100k for TDP and BP's TDP is so well-regarded that it is your golden ticket to being a phys trader so jr comp really isn't a concern. Some people jump over to the merchant houses like the one mentioned to make even more money. There are plenty of roles in the US - main hubs being Houston / NYC / Stamford. Power trading offers even more on the quant side (right from the get-go; there's a kid who posted his 300k offer right out of school trading FTRs) but is also very lucrative on the fundamental side (assuming you reach term trader from RT; just ask the ERCOT guys). Most experienced ops / risk guys at the top shops also do pretty well for themselves even if they don't make trader. Most IB people end up working sub 200k roles anyway when they go back into corp dev - at least in phys trading you have potential for 7 figures upside. Having been blinded by the IB/PE lens, if I could go back in time, I would immediately sign up for Texas A&M TRIP - program has guaranteed internships and most of them end up at top majors or Mercuria (which also pays like a bank for an entry level guy). 

 

Traders come from all sorts of backgrounds internally and externally, some start off in ops or risk within the company

There is no guarantee that you'll become a trader starting out at some of those places as well, so it's a long shot 

 

The goal at any commodity merchant is to get into a risk taking seat. Whether the bonus is written in or discretionary the top tier 5-7 firms are going to pay double digit % of pnl after costs. The very best firms also have share schemes that are ultimately worth more than the trading bonus. 

You should have a reasonable shot at 7 figure earnings even on the trading floor of an integrated major (excl XOM) OR asset backed player. 

Honestly don't know why more people aren't channelling their efforts into this career path over the typical IB track. 

 

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