O+G physical traders: where is the best place to start in this industry?
If you went to a top school with top grades and relevant exp, what internships would you gun for?
I tried out an HF internship during winter and next this summer as a quant at a commodities hedge fund, but I want to get into physical. Should have more relevant exp soph summer. From what I read on wso, TDP, Castleton, Macquarie? Are there any other good programs where i can lever my quant background?
Ah, diving into the world of physical oil and gas (O+G) trading, are we? Based on the most helpful WSO content, you're already on a promising path with a top school background, stellar grades, and some spicy internships under your belt. Transitioning from a quant role at a commodities hedge fund to physical trading is a bold move, but it sounds like you've got the chops for it.
Given your quant background and the desire to pivot into physical trading, here are some avenues and programs you might want to consider:
Trader Development Programs (TDPs): These are golden for folks like you. Companies like BP, Shell, and Chevron have well-regarded trading development programs that could be a perfect fit. They often look for candidates with strong analytical backgrounds, which your quant experience would complement nicely.
Castleton Commodities International (CCI): You've got your eye on the prize here. CCI is known for its robust trading operations and could be an excellent place to leverage your quant skills in a physical trading context.
Macquarie Group: Another solid choice. Macquarie's commodities and global markets division could offer you the hands-on experience with physical commodities trading you're seeking. They appreciate a strong quantitative background for analytical roles that support trading decisions.
Mercuria Energy Trading Program: Not as widely mentioned but equally prestigious, Mercuria's graduate program offers rotations that can give you a taste of different aspects of the trading business, including physical trading.
Gunvor Group: With a strong focus on physical commodities, Gunvor offers various opportunities that could allow you to leverage your quantitative skills in market analysis, risk management, and trading strategies.
Vitol: As one of the largest independent energy traders, Vitol's graduate program could be a great entry point into physical trading. They value analytical prowess and could offer a dynamic environment to apply your quant skills.
Remember, while your quant background is a strong asset, physical trading also demands a deep understanding of logistics, regulations, and market dynamics specific to physical commodities. Networking, as always, plays a crucial role. Engage with professionals in the field, attend industry conferences, and don't shy away from reaching out to alumni or connections who work in physical trading.
Your journey from quant to physical trading in the O+G sector sounds like an exciting adventure. With your background and ambition, you're well-equipped to make a splash. Keep leveraging the insights from WSO and beyond, and you'll find the right path that marries your analytical strengths with the gritty world of physical commodities. Good luck!
Sources: Best internships for Quant Trading?, Q&A: VP Trader at BB, Q&A: Physical Oil Trading, RE: Prop/Quant Trading - Why is it not as big a target as Investment Banking?, Skills needed for a quantitative trader?
Check out power markets if you want to jump into the ring with the physical commodity trading math-letes. Not my jam but the power guys have the brain power for sure. You’d be a sad boy and unfulfilled in oil after a week when realizing you spend your time dealing with vessels missing delivery windows and off spec bbls vs ML models
'If you went to a top school with top grades and relevant exp' I wouldn't be going for physical commods.... Go trade power and gas at a fund as the main goal and have the physical programmes as a backup. From what I've heard recently the CCI programme is probably the best especially the London office. First couple years are rotational so you can try out physical oil as well as a hf style gas and power trading team, programme has also been running long enough for them to know what they are doing. Only caveat it might be the most competitive internship/grad role in the world due to how few people they take on and expectations on those interns/grads are very high from day 1.
If you want to do physical nothing better than going the TDP route for Oil & Gas. Power is a bit of a different game so not much info on that. Thought if you want to leverage your quant side other people have provided good feedback.
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