Not quite sure...
After reading these boards for a while and doing extensive searches (see I do my part), I am still kind of unsure about what BB S&T is. For the most part, they are making markets for their clients and providing liquidity. But isn't this flow trading? (Yes, I know a lucky few can get prop). But if you start off as a flow trader, isn't it hard to switch to normal prop trading? Because to me, after reading lots of posts, it seems that the skills sets are somewhat different and it;s hard to go from flow (which is BB0 to prop (seems more interesting).
Can someone please clarify? Thanks!
Just for more clarification... I mean like you get assigned to a rates desk or w/e type of desk and on that desk you deal with clients so you are in flow trading...Right?
As I have heard.
You make markets, but also can express your views fairly freely as long as you don't go crazy on risk. So, most flow traders do some prop as well. If they're really good, go to strictly prop desks or buyside.
by the desk itself or by some mid-office controller?
Mostly by desk heads. I mean, the basis of trading is managing risk, so that's basically what you do all day as a trader no matter where you are.
There are a lot of threads on this
Suffice to say, prop isn't 'better' than flow; they entail different skill sets. In fact, every product entails a different skill set.
On the credit side, most of the prop guys come from research and spend a lot less time 'trading' than you'd think. Some don't even do their own execution, so unless they employ some technical analysis, I wouldn't call it trading as much as timed investing. Depends mostly on their horizon.
...the dealership side of the business makes markets and effects trades for clients but they also take risk in a "prop-like" manner. Usually only a few guys on the desk take real risk tho...ie on a typical sell side rates desk only 1 or 2 guys really make signifigant bets with the firms capital...usually the head of the desk who usually trades the ten year note and maybe one other guy if he is well respected. Prop is "better" if you want to spend your days thinking about the markets because sell-side guys really spend 90% of their day in the hectic business of making markets. Also prop is a bit more prestigous because when a sell-side guy makes a ton of money traders will often write it off as "being in a good seat" where they see alot of client flow and therefore have an edge most market participants dont get. I used to work with a guy who would get so pissed off about that constant talk about him that he would get up and start talking to his seat to make fun of it, ie "hey seat, do you think the curve is going to steepen today!". Also, these days a dealership guy isnt garaunteed to get paid if he has a big year...alot of places are moving to a more "holistic" approach where the desk is looked at as a whole as opposed to an individual dude being able to say "i made X, you owe me .15x or whatever". Prop traders have set deals based on P&L...this also makes it much less political...ie if you are making money in prop you generally dont have to follow the dress code, can metaphorically tell anyone to fuck off, etc. I was an analyst/junior trader on a prop desk at a big dealership and it was a pretty awesome/fun job that was totally seperate from the regular politics of a bank. However, the "glory days" of prop trading on the sell-side are basically over (at least for now)...most firms are moving away from prop or scaling it back greatly.
Does this mean that people should start career on buy-side (prop-side) rather than sell-side (dealership trading) to get better market intuition? I used to think it was the other way around.
Great post Bondarb, you seem to know a lot.
If you don't mind me asking, how old are you, how many years have you been in S&T, and what desk do you trade on. Also, what career path did you take to where you are today?
Thanks so much for your replies. So if someone gets a job on a desk at a BB in S&T, they kind of have the intention of staying rather than going to prop?
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