Is discretionary trading dying?
I'm a discretionary trader, wondering to move in a future to a big HF or a big prop, but as I see in most of prop's webpages, they are hiring just quant traders.
Is everybody in prop firms specialized on algo trading, or are there still companies hiring junior/experienced discretionary traders?
I've seen some answers on some threads, but not serious at all, that's why I make this question, maybe repeated. If so, sorry, but I didn't find any reasonable answer.
There are still opportunities out there, but not many and keep in mind there are a lot of unemployed traders out there. If you want discretionary a BB market making desk isnt a bad place to be, its client focused but the risk management at its core is very similar to a discretionary prop trading book. To be honest, all the guys I know who are at large HF's doing discretionary prop got the spot by knowing someone through a relationship and then impressing enough to land a spot, was never an advertised spot.
Just keep in mind there are very few bids out there right now.
Thank you for your answer derivstrading, that's more or less what I had in mind... Everything in this world is about knowing people, this business isn't the exception.
Now I'm working as market market in a prop shop and I'm really happy with that, but I want to know where I can get to be in a mid-term. That's why I wonder if I have any real opportunity or the prop business has totally changed.
Why discretionary trading is lame? (Originally Posted: 06/20/2014)
I mean it seems that there is not one reputable proprietary trading firm which employs discretionary trading strategies - on the other hand, there are quite a few (global macro) hedge funds which in fact do disc. trading and are more successful. Why is the difference?
Prop firms don't like to tie up capital, so they have very short (intraday) holding periods. Discretionary macro traders are trying to profit from macroeconomic trends which take more than a day or two to play out (more like on the order of weeks or months). Hence, it's virtually impossible to to express a discretionary macro view from within a prop trading firm.
I'm discretionary trader. I ran a small prop book for a small investment bank... When I worked at the Fixed Income desk at BNP Paribas, there was a fx trader who watched charts and there was a senior fx trader at Wells Fargo Securities who watched charts. Blue Crest hires discretionary traders. I mean, these aren't some high school drop out wanna be traders who put in capital contribution at a chop shop. They know what they are doing.
The difference is prop traders try to make money on the volatility on a short term time span. Hedge funds is more geared towards more longer term. Predicting short term directional movement is incredibly hard.
And the thing is Algo hasn't been doing well either. Big name hedge funds and I mean the top of the top aren't doing so well this year and lost money. Algo hasn't been doing well since like 2012. Market has drastically change.
Consider the ease of entry into most proprietary trading firms. Anyone who can fund an account + training can call themselves a trader. I wonder if I buy another pair of Jordans if it'll make me a baller?
When I day traded stocks on a prop desk (Goldman Sachs second largest customer) we aimed for 1%/day of our buying power as a goal and we hit that consistently.
What was your buying power?
These are two different things. Prop aren't lame they're just different. It may seem hard at first but it's like any game, when u whatch it long enough (specific market), you will understand the rules and what drives it. Hedge fund tend to play more fundamentals.
Discretionary Proprietary Trading Firms - Advice (Originally Posted: 08/26/2012)
Hi, I have never posted in this forum before but have been a member for a while and read a lot about what you guys post.
3 questions:
1) What are the best discretionary prop trading firms, ideally NYC, that lets you trades multiple products? Not Quant/High frequency/algo or MM etc. My style is discretionary global macro. I trade on 2 frequencies, Intraday S&P emini futures and more swing trading and long term in other asset classes. Very similar to a PM at Moore, Tudor etc
2) I have a fair bit of experience and uinterested in beeing trained, just want capital, a social environment and build a track record over 2-3 years so that I can pitch myself for a discretionary Global Macro HF. Am I dillusional thinking a Global Macro HF would hire for example a FNYS prop trader as a junior trader ?
3) If I was top 5% of the traders at a prop firm, how much capital will a prop firm sponsor you with the first year, second year, third year etc. I want to get a ball park figure for how much I can make if I have 20-30% stable return over a year.
Thanks !!
Hey there,
No I dont think you are delusional. But I guess the hard part is trying to get capital from the firms without going through their training program or being the firm's "assistant trader" for a year or two (it's huge time suck). The thing is there arent that many prop firms that focus on keep discretionary traders that let them do whatever the heck they want with capital. I think Schonfeld securities (they own trillium too) is one of the pure discretionary firms out there that gives traders capital. Try applying there :)
Hey there,
No I dont think you are delusional. But I guess the hard part is trying to get capital from the firms without going through their training program or being the firm's "assistant trader" for a year or two (it's huge time suck). The thing is there arent that many prop firms that focus on keep discretionary traders that let them do whatever the heck they want with capital. I think Schonfeld securities (they own trillium too) is one of the pure discretionary firms out there that gives traders capital. Try applying there :)
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