Non-compete agreement

For Optiver, it states which type of firms you're not supposed to work for and how long.

Can someone tell me the approximate time-frame one cannot work for another firm based on the non-compete agreement ? I am trying to get a general idea of the timeframe these prop firms enforce before you can work for another market making firm.

The firms listed that you cannot work for - are they mostly other market making firms ?

Thanks very much.

Usually 6-12 months The firm can choose whether or not to enforce it. If the firm enforces it, in a lot of cases they must pay your salary during that time Covers "Competitors" Also, if you leave to start your own firm, you agree not to poach others

Hard to enforce in CA; I think the CA Supreme Court ruled that non-competes are unenforceable there.

Based on the posts above, would it be safe to assume that these prop firms typically look for people who are less likely to move around ?

Especially if it's true that they would have to pay the salary if they enforce the contract.

Noncompetes artificially makes people not want to move around. If the firm enforces the noncompete, and pays your salary, keep in mind that you still make no bonus, which for good traders is several multiples more than their base.

They're there to protect the best interest of the firm. If you just trained a kid for 6 months, and he hasn't produced a single dollar for you, of course you don't want him jumping to another firm, especially one that will hinder your ability to make money in that market. It's easily worth it for the firm to keep the kid out of action for the length of the noncompete. The 50-100k in salary that they will pay out is just a dime in the bucket

if you quit or fired for negligence, then the non-compete will come into affect. basically, you can't have a job in a brokerage/trading related company for a certain amount of time. most firms have a 1 year non-compete and some firms like SIG has a 3 year non-compete for new traders. these contracts are renegotiated every year and depending on your status at the firm, these can be change somewhat. for example, a trader's non-compete can only be for a certain product in a certain part of the world, etc.

usually if you get laid off, the non-compete time frame can be reduced

For the HF I'm starting at FT this summer, its 2 year non-compete for research department. Non-compete applies to similar research positions in similar strat HFs.