Pay difference Sales vs Trading
I’ve been trying to figure put how big of a difference is there between sales and trading when it comes to comp for a similar product (ie Derivs sales vs Derivs trading).
I’m in a trading seat but from the get go I was more interested in sales. I have a mentor who’s an MD in sales and told me that management tends to be more generous to traders when it comes to bonus.
How true is this? And I don’t want to include star traders. Just a good salespersons vs good trader.
Thanks
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Depends on products.
If it is a highly commoditized flow product, then really there is no difference.
If it is a lucrative illiquid products, then whoever can bring trades will get rewarded handsomely.
Spoke with someone in Sales at a BB, he said Traders make around 10-20% more on average in total comp since they usually work 1-2 hours longer than the Sales folks and they have a book to manage. This difference tends to increase as you climb, but then again a very talented rainmaker in sales can easily out-earn an average trader.
Lol nothing to do with hours, and the suggestion that traders work longer than sales is also bs.
Traders make more unless you cover sticky accounts. That being said if you are one of the select few that covers said sticky accounts, you can make much more than your traders, all a matter of weaseling your way into that book
Typically traders will make more, but sales has quite a lot going for it.
- A great salesperson can outearn an average trader at the same level, but the std dev of payouts is going to be smaller than in trading.
- Sales is mentally easier (no worrying about risk and pnl, your scoreboard only goes up over the year,...etc) and I would argue sales guys have higher QoL
- Sales has more job stability. Even though both can get cut, the rate for firing traders is much much higher. Banks also have this profile where really great traders often leave for more upside, but most good salespeople stay put. So you have more guys ahead of you in line in sales.
- Slightly better exit opps - it's easier to transition to a person-facing role, or lateral since its about relationships.
Sales is cushier, and the pay reflects that. There are different types of sales roles too - working with fast money needs sales guys to be sharp, while working with corporates (i.e. retail with size) just requires you to make sure everything is set up (systems, credit,...etc) rather than focus solely on pricing and execution. So, it's important to be aware for what sort of role you're looking at.
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