Insights on an Experienced Trader role at Flow Traders?
Thinking about interviewing there and would appreciate it if anyone had any color on this.
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Sources: Q&A: 25 years Sales / Trading Experience, Flow Traders Test, MUST READ! What makes a good trader, fund manager, hedge fund manager, salestrader, and buy-side trader, SIG vs. Flow Traders New Grad Trading Role, Navigating The Floor: A S&T Analyst's Guide
Flow is basically a firm that relies on volatility being high. They do exceptionally well when it is high(Covid was a huge year for them) and haven't really been doing as well since then. They do a lot in ETFs, and unfortunately for anyone in ETFs you'll always play for second place behind JSC.
Reality of market making is that it's going to get more and more concentrated over time. The number of OMMs doing basically the same shit as the next firm is insane, and most of them would probably get absorbed sooner or later.
I would say if you're in Americas, it's probably better to look at firms big here, and if you're in EU then sure apply but don't expect big things there
yeh FT did an article on this (search up are we approaching peak prop) and their conclusion was prop is getting v consolidated and if u aren’t top 5 your irrelevant
top5 was JS SiG citsec HRT jump in that order
now i’d expand that to top10/15 (add optiver imc drw 5rings etc) but point stands
I wouldn't say that much. I would say it's less about top shops and more who dominates what. Optiver, IMC, and SIG are pretty dominant in OMM, so they'll probably slowly absorb smaller firms or kill them off as scale helps. One thing about OMM specifically, though, is that it doesn't scale as well as systematic strats in the D1 category. This simply has to do with how systematic vs discretionary things are. That's a big reason why Optiver and SIG are pushing more into the systematic space. If you can become systematic fully, you can scale much higher without needing to massively increase headcounts, which is basically the ideal scenario for any prop shop. So they're trying to make options more systematic, and if they can, then they don't need nearly as many traders. Researchers become top dogs in OMM, like how researchers are currently rather dominant in systematic D1 and mid freq.
Some smaller firms that dominate niches will survive and do well. 5 rings is hard to say, they're really secretive. I've heard they do a lot of energy and commodities options, so if they stay in that area and don't explode headcount they'll do fine. I'd say it's more likely that tower and XTX survive and do better. Too many players in the options markets these days, and while there's basically a gold mine to be made there, it's just ripe for someone to come in and fully automate it, and if someone can do that then they'll wipe the floor with firms reliant on human traders.
you are right but these days top shops dominate everything
all the big shops do every thing HFT, OMM, stat arb etc. and most of them are very good at most of these and getting better every day. thus any non big shop will find it harder and harder to compete
nicher areas like crypto (and prediction markets now) do still offer some scope but eventually that might get taken over by the big guys asw
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