Typically who would see higher comp numbers? Is it possible to transition from being a market maker to being a portfolio manager?
From what I heard, all prop trading is not equal: sellside roles start out higher but cap out much lower, whereas portfolio managers at a solid hedge fund can pull in 8 figures on a good year but roles for buyside analysts start out much lower. Is that fairly accurate?
First of all, I'm curious of why u think proprietary trading is sell-side. If you consider making market -> providing liquidity -> could be seen as brokerage -> sell side, I'm quite sure that's not the common perception about prop trading though.
About the salary, it seems quite right when only considering the average for the junior analyst/traders.
All I'm saying is I don't see many people from firms like Optiver go to firms like Citadel - I see many go to Citadel Securities though and similar firms. Equally I see people can move from firms like Vitol to Citadel, but not to Citadel Securities, and hear that the pay far outstrips their market making counterparts. Edit: perhaps I should say market making firms rather than "sellside"
Considering prop shops have 'client' facing teams now... they're basically in the same business as th S&T divisions. Both are market-making broker/dealers.
Pay as a Portfolio Manager, whether that be at a Hedge Fund or Asset Management firm will far outstrip pay at a Market Maker. If you are at a sole Market Maker and not a sellside bank it’s very rare you’ll even make the jump over to a hedge fund. sellside Traders often mainly make the jump to Macro funds. Find it very hard to move to L/S or event-driven type funds.
Sad days.. Could you shed any light on some bonus numbers? I know an excellent trader at a MM firm can clear mid 7 figures on a very good year for the firm, but I've heard stories of PMs who pull 20M. Are those numbers viable on the buyside?
PM at my firm was in the pressers a few years back for clearing 30M that year. He was a superstar though and still is although he’s probably now earning about 10-15M a year? I’d say good PM’s are definitely still clearing millions, anywhere from 1-5 depending on the bps split, great PM’s will be in the double digits easily.
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