Prop-shop to BB S&T or HF?
I work at a prop shop in fixed income and am looking to make the jump. This is non-algo, non-quant discretionary trading. A few reasons:
- The prop trading approach (day-trading/scalping only) is getting tedious, and there's not enough depth. No exposure to any fixed income derivatives (no options, let alone swap/agency space). Just optimizing an ever-dwindling scalp.
- I fear for the future of non-algo trading. My job might be gobbled up by algos in a few years (months?).
- No surprise here, I'm not killing it. I'm making money, but not enough to sacrifice networking thru clients/exit opps/broader market exposure by staying.
I went to a target (HYPSM) with a non-stellar GPA and no SA stints, took the prop role to get my foot in the door. I'm not looking to get my own book at GS or something, I'm totally willing to not take risk at first (though I'd think having prop-traded might accelerate getting my own book if I work hard and smart). My end goal is to work in an FI-related HF (credit, maybe global macro focusing on FI?) so an HF position would be great, though that might be too ambitious.
I realize my best chance is to network hard, but I have a few questions:
- My prop PnL isn't gonna wow anyone, is this a serious problem? Serious enough to warrant staying in my position and building it up?
- I have little modeling experience (crucial at HFs as I understand). How to acquire this experience or compensate for lack thereof?
- Any general advice as far as how to frame my story?
- As a last resort I'm considering a B-school stint followed by landing an S&T gig and going from there. Would this work or is B-school reserved for switching out of trading?
- For general discussion: what's a typical exit opp for a prop-trader? Do they all burn out and work at Sears?
Thanks WSO, I hope this sparks spirited discussion
Question: Are you at one of those prop shops that require nominal risk capital?
No offense, no one takes those shops seriously. Those are basically brokerages that offer training & waste valuable moments of your life.
I'm not at one of these shops. My shop has a trading assistant program that's salaried, and no capital needs to be put up. Similar tier as Consolidated or Wolverine (but not algo).
It's going to be extremely tough to get into a top b-school coming from a prop trading shop. I think traders have it the roughest when it comes to mba admissions. Ideally you could kick butt at your current job, manage a book, and have a track record that you can show headhunters in the buyside space. I don't think prop>macro is a viable path since most macro funds hire from BB S&T desks.
If you could get into a good MBA, then trying to get into S&T from there is the best path, and even there, you will most likely end up in sales, not trading. However, sales desks do give you exposure to buyside clients, so you can develop relationships and make the transition.
What are your thoughts on Prop shop>BB S&T with no MBA?
Are you opposed to quant/algo trading? You have a good pedigree so presumably you're smart enough to be able to learn to program.
agreed, yet an MBA is no small undertaking, and definitely not a plausible route to S&T.
Not exactly the same thing, but I interned at one of the better-known prop firms in Chicago and am now in S&T at a BB. I know others that have made the jump, but people who find success at the top prop shops usually don't want to leave. For those that do, networking is a must. You can go about it the old school way, but also by leveraging your relationships with BB brokers where you are now (be cautious with the latter).
The fact your firm still has you around is in some ways an implicit endorsement of your P&L. My old company used a team approach to employ more elaborate strategies than the typical "every man for himself" operation. That meant the group performance was a more important than individual P&L. Not sure if it's the same where you are, but I would frame it that context.
For the record, prop traders can and do get MBAs. On my desk alone, 4 people were enrolled at Booth with the firm covering the cost. However, hiring is down across the board and an MBA won't get you any special treatment, just another crack at recruiting.
I'm assuming the people at your desk did the Booth evening MBA, hence why the firm covered the costs. A lot of prop traders do the booth part-time program, but I was talking about the full-time mba, which is a different beast when it comes to admission.
That LOTR Quant meme just made my day. And I currently work at a prop shop myself, and the consensus was pretty much across the board. S&T jobs are even more difficult to come by than before, and many of the senior traders thought I was stupid for even wanting to go into it. I figured working at a bigger name would open more doors for me down the road. This firm is pretty lax and I'm pretty much left alone by management since I'm bringing in money, and I know a Bank is a more structured environment.
Could you give me some insight into your experience?
Good points! Markets are becomming a lot harder over all and the S&T jobs are decreasing at a substantial rate; esp in equities.
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