Truth about Trading
I keep hearing two different progressions in trading. One is that everyone starts in back office and works their way up to eventual trader or front office. I also hear that once you are in back office, you are stuck in back office unless you get lucky.
Which is it? Is it different for different firms?
Depends, but I would say more towards the second. At least at BB's, i know most people in FO get hired into their, as with BO. There are certain people that move to front from back, but from what i've seen it's kind of rare unless you really want it for a while and/or get lucky there's an opening, especially now. However you might find it's different at smaller or prop firms. just my 2 c.
The energy trading companies I have been associated with tend to push people along the following path:
1). Risk Management/Scheduling 2). Cash/Spot Trading 3). Futs/Opts/Deferred Trading
This tends to be true for bigger and more structured shops.
People can make it from the back office to the front office much easier. A lot of people start as a sales assistant/trading assistant which is basically a probational trainee and then if you are smart enough and skilled you can work your way up as a sales trader or possibly as an execution type trader.
sales assistant/trading assistant is still front office. It's junior front office. Of course people that are assistant traders will one day be promoted to trader, so long as they're good enough. Risk management, for example, is back office.
I think it can definitely happen, but it is pretty rare. From what I've seen almost every single person in sales, trading, or structuring was hired directly from ugrad or grad school, or from a front-office position at another bank.
Like everyone else, I've heard stories, but I've never personally met anyone who did it. And I can personally attest that on most of the desks I've been on (either working full-time or rotating during summer and full-time internships) I don't recall anyone who made that transition.
That said, like everything else this could very well change as a result of the crisis....
Remember that multi-billion dollar lost by Societe General? Guess from where that trader initially came...
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