Why I stuck to the sellside (no regrets)
Used this site a lot when I was younger. Now a senior trader with a BB (think gs/jpm/ms). Have been in trading for just under 15 years, and with my current bank for about 10 years.
Came close to jumping to buyside a few times but always decided against it, for a number of reasons:
1) I enjoy the the ancillary aspects of the job - the client exposure, team management, training juniors, even (some of) the politics. The autonomy in buyside can be attractive for people who want to “out and out” trade but I never minded the wider job scope.
2) resources - yes there are constraints (regulation and all) with trading in a bank but you do get access to the wider bank. For example, I am in credit and I work a lot with ibd (esp dcm, lev fin).
3) job comfort - you do well (whatever that means) you get promoted and you climb through the ranks, but without the stiffness you find in ibd. Buyside has a flat structure which suits some, but I always thought itd be less rewarding (not in terms of money),
4) job security - slightly different to the above in that losing your job requires a serious disaster. Yes, the flipside in the buyside is more money if you do well, but not losing sleep over your job is worth sth too as you get older.
5) never got fucked by automation!
Wanted to share on the back of the various posts asking about this career.
The above aren’t pros and cons though. They are simple personal preferences. So not meant to persuade or dissuade you one way or another. Just hopefully help people realise that different careers suit different personalities. Plus the missus and the kids are away for the weekend so I had some time to kill!
A few questions:
Started off on cds, have now moved more towards hy/default. Not concerned about automation taking over my job. Compensation has been good - esp recently.
Would you still recommend going into s&t?
If you are interested in trading, for sure. Or, put another way, I wouldn’t be dissuaded from going into SnT if I had an interest in the industry.
Pretty much all people shooting for buy side will be going to IB instead of S&T. Great advice but your perspective isn’t the same as many in IB.
Ok…But I think you missed the point.
You have to be a complete retard.
I'm sure macro funds are very interested in IB profiles.
Yeah they definitely dig DCF skills to trade swap :)
Thanks so much for doing this! I'm going to start out my career at one of the BBs you mentioned in macro trading. I understand you said comp was alright, but wondering where you see this in the future? Do you see it decreasing in the next 10 or so years (bonus silver banana for an analyst - MD rough comp guide)? Also for us newbies, do you think starting out on the sellside is better than starting out on the buyside for a career in trading?
I think roughly it’s 95k-190k from analyst to vp. It then varies but should be at least high six figures by the time you’re a new MD. Macro trading will always be around so even if you’re going through shit years, you’ll make money - my macro desk has been killing it recently, but was getting fucked in the mid 2010s.
I'm curious to know how someone in a HF can move into the sellside w/o prior experience on sellside. Asking b/c I've seen some people do it but always wondered how.
I haven’t seen this done, not at a senior level anyway. Normally the buy side to sell side journey is a return one - and there will be reasons why a bank will want to splash out for that person which go beyond him/her being a markets genius (normally it’s the address book, contacts, etc.).
I'll be joining a crypto desk at one of the larger crypto-native firms similar in reputation to the BB's and I'm super excited as most of the experienced people leading these desks have great experience in their specific product but not too much knowledge on the underlying market structure which leads me to believe that even as a Junior the playing field for promotion and career growth has the potential to be quicker than traditional finance. In traditional products I feel like the people who have the most experience have 20+ years of experience in their product and understand the ins and outs so in-depth they know almost every situation and how to trade it which kind of makes the ladder a lot more rigid for a junior to climb. In digital assets/crypto our desk head has 3 years of experience trading crypto specifically and 15 years in a different product, I feel like this is a unique opportunity for me to have the ability to have less of a rigid structure when trying to climb and get promoted if I'm almost on an equal playing field in terms of specific product knowledge. Would you agree with the conclusion that I feel like S&T on a crypto-desk might offer me advantages in climbing the ladder quicker than another more traditional product?
Wait this is super interesting. What kind of crypto products will you trade and which BBs have this kind of desk?
Most of the desks are typically research desks now but certain divisions such as Goldman and JPM are starting to trade CME futures, make markets on the listed ETF products, and CME futures options. I shouldn't have been so misleading when I said BB (BB's are opening up these sort of desks so maybe in the future these would be specific roles) and should've just clarified that I'm working at one of the larger sell-side/market-makers on a crypto desk that would be an equivalent of the BB's in the crypto space - think Galaxy Digital, Genesis, NYDIG. I'll be making markets for crypto options and non-linear products such as the perpetual futures and comp is similar to the BB's it just feels like the hierarchy is a little bit more flat right now since the skill-set is so incredibly niche and some BB's can't touch these overseas products yet.
It can do. This is what happened with the funkier products pre-crisis. Just be cautious that the lack of precedent can also be a challenge (people more likely to dip in and out, easier to cut, etc.)
My advice is to ensure that you develop skills that are transferable, so you have a good story to sell if the new product doesn’t work out. Shouldn’t be hard to do, esp if you make money.
Signed an SnT internship offer for next summer. What do you suggest are the best desks to rotate on? The bank i will be interning at seems to be stronger in RMBS and related products. I'm interested in credit opportunities wether staying in the sellside or going to the buyside. The global markets program at my firm includes capital markets as well.
Help me a bit. What do you like within credit? High yield attracts a different personality to mortgages for instance.
What are your thoughts on portfolio trading within credit? I've read articles about it growing very quickly, do you think it will lead to more automation / would that be the desk to join in terms of future outlook?
How hard is it to make profitable trades on the sell side? Is there prop trading still just disguised as market making ? How often do you delegate tasks to the quants? Thank you.
I am in hy/distressed so frankly there’s a significant prop element even in market making. For my desk, I don’t use that many quants.
Thank you - so many people on this forum think traders just execute trades like monkeys without taking significant risk lol. When will the glory days come back for traders?
What are your thoughts on the growth and future prospect of EM credit( sovereign and corps)
Additionally, do you think trading macro credit products like cdx, options and credit etfs is a spot to be?
Depending on the product I highly believe that yes you can take on a proprietary risk position as a sell-side market-maker it really just depends on how you hedge your positions and what you're skewing your markets to when you build things up. Even a directionally neutral position cannot also be hedged for theta, gamma, and vega. You can't offset every single risk and still expect to make profit. Options market-makers definitely take a proprietary idea whether or not they're skewed to buy or sell options and whether or not they want to fully hedge their directional risk or whether they want to leave some of their delta exposure open.
net worth ?
8 inches. Bit more on a warm day.
Can you talk a bit more about the process around making MD? Just based on personal experience at a couple of places I have worked it seems like you just need make it to associate and then you can pretty much exist in the seat and will make director in 6-8 years but making MD seems to be a total crapshoot. I see people who I think are very good get stuck at director for years and people who are not as good get bumped up very quickly. Any thoughts on anything I should be doing as a newer director looking to not get stuck there. Outside of continuing to perform and get good reviews.
Hi,
Thanks for doing this. I am about to start as a VP in BB treasury and will be interested to exit to Trading 1 or 2 years down the line. Will be great if you can answer my questions.
1. Is it possible to move from Treasury to Trading? If so, what desks would be easier to exit into? (Equities, FI, Macro etc)
2. Which Trading desks would be least and most vulnerable to automation in the next 5 to 10 years? A ranking would be helpful.
3. Which desk generates the most revenue (generally) at most banks? Which one has the most risky job?
4. If I am able to move, what level should I target? Associate or VP?
better to move asap..the more junior the better. Much of what you learn in Treasury will be useless on a trading desk, and your higher salary needs will be a hindrance in getting hired..
Are there any merger arbitrage desks left ? Who deals with spin offs etc
Thanks for the color and happy for you that you found your calling!!!
Can you please touch on your interaction with IBD? Always assumed the Chinese wall would prevent this
Going through a rotational FI program this summer after a summer at an asset manager last year working with their traders. I would really like to end up on either the HY or Distressed desk at the bank, so I was wondering if you have any suggestions that could help me do so?
Hey currently an analyst on a US BB multi asset trading desk
Wanted to undertand a bit more about the exit to buyside - is it true that people tend to become execution traders? Let's say you as a HY Credit trader trading cash credit (and maybe CDSs if not done by someone else) - when you get approached by HHs or you applying for roles is there a clear path to be a credit PM? I understand the nature of HY is OTC so perhaps like you said there's more prop elements especially when you receive lots of flow
If the same situation but you're a trader in an asset that can mostly be exchange traded then do yoh then become execution trader as you're more managing the book rather than capturing alpha through your flows?Am interested in your thoughts as even HFs where traditionally think is a common S&T exit they hire plenty of IB people for more L/S or fundamental roles for PM - which means I'm under the impression that if you're an equities trader you're unlikely to be on the PM track
Thanks! Appreciate the time
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