Move to the desk or stay in IT

Hi everyone. Like many others, I have been peeking around the forum for quite a lot of time without really posting. Now I finally need some bespoke advice from you.

I am sure most of the people around here already think I am crazy just after reading the title of the post. The real reason I am posting is because I have two options ahead of me and I am struggling to choose. Hence… it would be quite useful to gather some opinions from this helpful community.

So here is my actual story. I graduated top of my class from a top UK uni with a master in CS. Initially I was going to stay for a Phd but quickly got lured into financial technology… the place where a lot of top CS talent ends up nowadays... I got a job as a front office desk developer at oil Major. So far so good… As I have been interested in physical energy trading for quite some time, I took the opportunity of working closely with the traders and for a short amount of time learned a fair bit about the industry, operational and logistic constraints, the process of executing a physical deal and so on...

Suppose now I have the opportunity to transfer to one of the trading teams as an analyst. My debate it should I pursue this opportunity.

To some people this might seem a very straightforward question and this is why I think the post can turn into an interesting discussion that casts some light onto the other side of things (staying in IT instead of transferring). Now, if I make the jump I end up in a position in which quite a lot of people would love to be in. Sitting on a trading desk at one of the majors is considered by many to be the best learning opportunity, if you want to go into phys trading. Needless to say the learning experience is amazing. You get equipped with knowledge that is sought after by the biggest players in commodity trading and is not possessed by many people. A few people have moved from this position to places like Trafi as junior traders. SO no doubt… this is an opportunity that most likely comes only once.

The other path that I can take is stay in IT. Much less risk, and very steady pay. Especially if you are good, in financial centers like London you can easily command 650 sterling a day as a contractor. And if you are a good dev, you will hardly have problems finding jobs. A good software developer can walk out of a bank and get another job in a matter of hours. The same cannot be said for trading analysts specialising in one particular physical product that is traded by only the biggest players in the field. Furthermore, software development gives you the opportunity to actually get involved in the startup world and be in a revenue generating position.

My observation is that most of the people here try to get out of support functions such as IT and go into front office, market-facing jobs. So some of you might think I have lost my mind, but all this is something I have thought about quite a bit and still cannot weight up the pros cons and the risk that would be trying to go into the physical trading world. I could certainly use some of your opinions. I would be particularly interested in what Illini thinks about all of this. As far as I gather, he is a CS grad pursuing a MS in finance. What made you do that? Dont you think being a software developer can provide with equally if not more rewarding career with a superior level of job security (given that you are half a standard deviation above the average :) .

 

Clearly I am interested in trading as I have already mentioned. However I dont think you get the meat of what I am actually saying. For me both things are interesting and each one comes with certain pros and cons. Obviously if you are in a trading team, your are viewed as a direct contributor to the bottom line while otherwise you are merely a cost to put it bluntly. What I am trying to weight up is exit ops, flexibility and career growth. And just to clarify the "trading job" is not a trader's job...

 

No offence... you either got 'it' or not for trading- here we not talking about PhD or so, but more the aptitude to get engaged....by reading your post, maybe you will be pushing yourself too hard and too far into a risk-taking role that you will not enjoy anyway in the long-term...

Hate to say so but can already point out an exit strategy for trader will be rather narrowly defined- especially in the case of unfortunate PnL, the person will be considered as damaged good and it is a small world...

 

I would be very interested to know how did you deduce from my post that I will not enjoy the role in the long term. I am just trying to analyse the situation and get a sense of the risk / reward ratio.

No offence but what your post is evolving around is what I would consider to be common knowledge (if not common sense). Thank you though.

 

It still ultimately comes down to do what you want but I think your analysis might be a little bit too simple. There's no reason why you shouldn't take this analyst role.

Long term career - The path forward really isn't as straightforward as trader or bust. I assume this is a middle office/market and risk analyst sort of role? You'll learn a ton and it's entirely reasonable to make a very good career out of it and go into the management side. It's a fairly steady job that many people find fulfilling and the pay will top out higher than it would on the IT side. If you miss the involvement with the IT development side, you can work that into your role as a deals desk/middle office manager. People would probably love it. There's more than one company out there with a non-CS middle office head overseeing the IT development and it's really not ideal.

If you really, really miss the IT side, quit after a year and go back to it. You'll be just as - if not more - valuable anyway since you have hands-on experience on the trading/physical side.

'Exit op'/what if I fuck up - If you don't make it to trader, you still have the options above. If you DO make it to trader before you screw up, I still don't think your 'exit strategy' (I hate that word) is as bleak as yeak2 makes it out to be. Physical traders have a much broader skill set and more relationships than your average paper trader. Lots of options. Can go to the producer side, go into logistics, back into middle office, etc.

I will say though that - depending on how your company is run - try and get a feel for what you can expect out of the role. Yeak2 is right about the 'got it or not' part in the sense that the traders either think an analyst has got it or not. It's all too common to see people thinking they're going to get a shot at trading when really they've already been written off.

 

Could you elaborate on this more in terms of the "got it or not" and what goes in to deciding this? Would you say that more than anything it's about fitting well in to the culture of the desk? '

Is it personality based, performance based, etc? I certainly understand the role of intangibles that go in to deciding whether or not you think a guys a good guy from a social standpoint, but I wonder if there's anything unique from a trading standpoint, something maybe universally regarded as a common trait among analysts who traders eventually want to give a seat to.

 
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