trading internship prep?
Hey guys,
There seems to be a lot of information on how to prepare for an i banking internship, but what's the best way to prepare for an internship in trading? Specific skills to brush up on? Reading?
Thanks
excel skills; basic knowledge in equities, fixed income, FX; probabilities; alcohol tolerance
I have the same question but regarding commodity trading in particular.
Yeah I'm looking for some help here too.. I'd say Beyond Greed and Fear by Shefrin to start tho
and liar's poker
math is important in fixed income (especially bond math), but not as much as you think...
what I found to be helpful, especially last summer (I did FI S&T at a BB) was that market knowledge is the best. Let me expand...If you are doing FI, know what yields are doing, know the state of credit markets (past/present/future), know how FX and CMDTY markets have been moving. Most of the stuff you will learn on the job.
I will agree with in that probabilities (mock trading simulations) and quick math (good estimation skills) are very good to impress traders.
mostly...be cool and be secular in your knowledge. hope that helps, msg me if u want more specifics.
Anything for commodities/energy specifically...
I worked in commodities and these are some of the things I found useful;
1) Good excel skills (I had to do some coding so Excel VBA was helpful though I haven't learned it before, so I had it to learn it during my time with the desk)
2) Know the products well. I was in oil, so I had to learn a lot about the different types (tapis, wti). You Don't need to know anything about strategies because they will teach you that. If you're in derivatives, brush up on some of that stuff.
3) A lot of the traders used to explain their hedges, i.e. hedging one product with another (non-derivatives traders), hedging with futures and options etc for derivatives traders.
A lot of the stuff you can learn on the desk, but since you asked, these are some things that might give you an edge.
There are some commodities/energy traders on the forum, and they can chime in some more.
I've been told to get through as much of Hull's book as I can and The Black Swan as prep, but I've no previous financial knowledge from any courses/etc, only maths, so I'm learning this stuff from scratch (Hull's book is long... lol)
best of luck :)
Check out this guide that gives several suggested items that you might do to prepare for a sales and trading internship: http://www.gottamentor.com/viewRoadmap.aspx?r=285
www.gottamentor.com
Preparing for FT trading role(1st year) (Originally Posted: 11/09/2011)
I just accepted a trading role at an options market maker in Chicago. I don't start for a few months, but what would you guys recommend me doing to be best prepared(books, tech skills, etc. that may not have been taught in undergraduate education)? Thanks.
how did you land the gig?
what are your specs, if you don't mind.
i really like this list by drw: http://www.drwtrading.com/careers/recommended-reading-list/
@cold pizza Applied online and was invited to the final round after having an interview over Skype where there were behavioral and mental math/probability questions asked. I'm a senior right now studying finance with an internship at one of the large banks and participation in my school's investment fund. Anything else as far as specs go you can pm me.
@za3212 Thanks. I'll have to check some of those out.
Honestly, they are going to train you. Enjoy your senior year, know excel, and don't fuck up traders' coffee orders
Haha ok. Thanks.
He's in prop, he'll be managing a book instead.
Even so, he's not going to have PnL until he proves he can get someones lunch/coffee order right.
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Some great options books:
The Prerequisites Options, Futures, and Other Derivatives by Hull Option Volatility and Pricing by Natenberg
More advanced options theory: Option Market Making by Baird Options Markets by Cox Dynamic Hedging by Taleb Volatility Trading by Sinclair The Volatility Surface by Gatheral
Thanks for the list.
IMO- get in top shape as you need to be focused to handle the high stress, do a lot of cardio.
Become an expert on the greeks, know whats going on with the markets and know everything about the various types of vol
**this website helped when I was on the option desk: http://www.aadsoft.com/tutorial/contents.htm
Also being a market maker, it really helps to know what players use options and why these strategies make sense for them (where money is going, what risk/reward is etc.)
VBA and quick mental math is also very useful.
FT Trading Preparation (Originally Posted: 06/08/2011)
I'm starting work this summer in a rotational trading program at a bulge bracket. My exact desk is unknown. Aside from keeping up with the news, can anyone make recommendations for preparation I can do now beforehand so that I can hit the ground running? Also, what are some tips or advice for first few days, weeks, and months while on the desk that others could share?
Do you know if you are in FICC or Equities? If you are in the fixed income department, get your interest rate foundation straight. That is the building block of rates, credit, and even fx so know how to do basic things like bootstrap, duration/convexity, simple spread analysis, z/g/oas curves etc. The Fabozzi book will help.
If you are in equities, get your accounting/valuation straight so you can read and understand analyst reports. If you are in derivatives, grab Natenberg and go through it to understand practical options theory. To delve further into understanding options, I would also suggest Baird's Option Market Making (one of the most underrated books imo).
Bairds book was average imo, the title of the book is a huge misnomer because its just a regular options book.
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