Q&A: Sales and Trading Analyst

I know this comes off as a bit of a non answer, but I think attempting to time a sector to begin your career in is akin to trying to time the top or bottom in a trade. The hottest market today might be slow in a few years, and the slowest market could pick up just the same. Ultimately I think the biggest thing to consider is how drastically different desks can vary in market size, liquidity, volatility, etc. In choosing a sales and trading path the "fit" on the desk become more important than the current attractiveness of the market. For instance, sales v. trading, flow v. structured products, etc.

While i second his answer that "fit" is more important, in general, choose products that have the smallest opportunity to get absolutely wrecked by increasing regulations (e.g structured credit)

While at any one time you're either a sales or a trading analyst I appreciate the extremely productive contribution to the conversation. I'm currently on a trading desk, but was on a structured products sales desk before that. The flow is not the best it's ever been as you can imagine, but better than the media often portrays it. While there's no denying the fact that banks aren't expanding like they used to in S&T, the business will always be around and is doing well for the time being.

I would advise to make the most of having the title of an intern. As an intern you'll have plenty of time to sit with traders, ask people to go for coffee, and meet as many people as possible. Once you're a FT analyst you won't have the free time you did as an intern. Additionally it's important to get into a project that you can really prove yourself with. As an intern in S&T your job will vary quite a bit from being a FT analyst, unlike in banking, so it becomes more difficult to determine who would be the best analysts.

Please learn Excel/VBA before you start the internship so you can be useful to me.

I've definitely thought about it at times, but probably not right away. As opposed to banking, more analysts tend to stick around in S&T. Also the ultimate goal in S&T is to have revenue to your name whether that be building a client list in sales or attributing PnL to your name in trading. Leaving before becomes a senior associate becomes difficult as you'd still have to prove yourself at the next shop, whereas recruiting as an experienced trader/sales person becomes a different arena than as an analyst/junior associate.

Appreciate the thoughtful question. Before I started I wish I had taken some of the advice given to me. While traders might say things like learn vba/learn how to program, etc, it can not be stressed enough how useful these skills are when you actually hit the desk. If you actually know what you're doing with vba, python, matlab, and/or excel add-ins the sky is the limit. I would say my perspective has changed from being an intern to being an analyst as you aren't aware of office politics as an intern. Hitting the desk you gain a better understand for where people stand and the thoughts behind moving different analysts to different desks. It's always good to take a step back and think if I was head of this group how would I move people around and position yourself accordingly.

Thanks for the question, I'm not too involved with the desk, so I'll let someone else take a stab at this one. As for the spot, I would say take whatever you can get at the end of the day. It's always smart to be positioning for the best spot possible, but all things considered being an analyst in the FO at a bank is still a good place to be.

I don't have my own book, but have been given some room to put on small trade and execute some positions. It really depends on the desk when/ if you'll get to trade. For the most part, I'm still the project guy. I would say the transition goes from supporting the desk --> research analyst/project guy --> trader

Stub bonus and pay was the same for all 1st years, S&T and IB

They're good firms but be aware that the cull is fairly agressive. If you have an easily transferable skillset (eg if you are easily able to switch to tech in case you don't make it) then it's certainly an interesting experience. Easier to make money "fast" there if you are in fact very good.

Most coffee with milk haha, and lunch orders will change, but wings and burgers are always a crowd pleaser

Major U.S. city is as far I'd go

A prop shop will by definition engage in proprietary trading, trading the firm's own money and trade accordingly. These firms will differ in the markets they trade in, but are increasingly becoming intertwined with HFT. BB used to prop trade, but having been pulling back more and more in this increased regulatory world and will make money based on making markets. So if you're a institutional client asking to trade a large block of stock you would call up a BB Equity trader and he would execute the trade on your behalf. There's subtleties to the spectrum from pure prop trading to pure execution trading, but that's the general idea.

I think you could do it, but it depends on the firm. A polished fund, whether it be a mutual fund or hedge fund, will mostly hire candidates from the best school because they can and want to have the best image possible. On the other hand, prop shops are more willing to give someone a chance who can prove their trading prowess. I've found that in trading, there's much less of a typical route and you can always be hustling to find something.

I'm on a trading desk, and if this question is similar to an earlier one about having a book, no I do not as of yet. And you're correct in that you're dealing with institutional and corporate clients and trading on their behalf. It is fixed income, but in a small group, so I don't want to get overly specific yet.

I think the most important thing to be aware of as an intern is to figure out who the decision makers are. At the end of the summer the desks heads and some others will talk about their thoughts on the different interns. You'll want to have made enough of an impression on at least one of these decision makers to earn an analyst gig. Another thing I would advise is to sit down with as many traders and sales personnel and see what they look at day-to-day.

At the junior level, the roles are actually quite similar. Excel skills are absolutely necessary.

I would say it depends on the desk, generally they are quite similar, but can also differ quite a bit. On a desk with quite a few traders the day can become quite busy booking trades, analyzing positions, PnL, etc; whereas certain sales desk might be more presentation focused.

Good question. Remember that bulge brackets aren't just brokers, they are broker-dealers.. The bulge bracket will provide prices much tighter than the customer can source on the screens/floor, if those even exist (note that most products trade OTC)

Bro they totally should. You're well-researched questions mean the end of all BB trading operations!

But like seriously - come on, there is a difference between being a licensed member of an exchange, and a market maker in the OTC market. But I'll give you a hint, it's called liquidity.

PIMCO wants to sell/buy some bonds - where they gonna get that from? If there's no BB's making markets, they'll buy/sell from Bridgewater. What if Bridgewater doesn't want to sell? What if they dont' want to sell in the same size/time etc? Ta da here's your BB traders.

Projects involve analyzing flow by client and client type, potential new clients, working with the desk analyst for internal supply/demand balances, sentiment data. Other programming related projects can involve aggregating data from various sources and a lot of fixing models for pricing.