Advice for a former military officer who wants to be a trader?

OK. Sorry, this is a duplicate post from one I made in the b-school forum.

I've read a lot of posts in this forum about becoming a trader, etc., etc. I'd like to get "good intel" from traders at a top-tier I-bank (or any for that matter). Bottom line, I want to take the appropriate steps, which offer me the best chances, to become a trader at a European I-bank.

As for my particular interests in the markets: currencies and commodities. (I trade forex and gold futures, and I absolutely love these markets.)

Why do I want to be a trader? Because I want to turn my "hobby" into a "real job" and work with cool people who actually give a damn about what I do. Also, since I consider myself a speculator, I want to learn more techniques and skills in order to become a better trader. I figure this is best possible by working for an I-bank with a dedicated and smart team of professionals. Ultimately, I want to work in a hedge fund, for a prop desk at a BB, or have my own hedge fund.

My post from the b-school forum:

I am trying to switch careers (prior military officer looking to work for an I-bank) by getting an MBA in Europe. Specifically, I want to work in trading/sales for a top-tier I-bank in Europe. I currently live in Europe, and have been here for over 4 years.

Besides LBS and Insead, what are the other "brand" schools that could help me successfully transition careers from non-finance (military) to investment banking (trading/sales)?

I'm looking at Oxford and Cambridge primarily, and I think I have good chances getting in there. But, I'm not sure if these schools would offer me the same opportunies (or odds) of navigating this career switch as compared to LBS/Insead? I prefer the 1 year format over 2-year, but I understand this could limit the internship opportunity.

I realize that one doesn't need an MBA to be a trader. But, since I'm a career switcher and have almost 5 years non-financial work experience, I think the MBA (with a finance focus) offers the best solution to my needs.

Anyhow, I look forward to any positive/negative feedback.

Thanks,
William

 

You can work in Europe even if you go to an American b-school, provided it is a top school (H/S/W), especially if you have lived there and speak the language. I don't work in trading but that is my general feeling.

One thing you should do is look at any schools you are interested in, and look at their employment reports. See who the biggest employers are and what % of the class goes into S&T.

I am a former military officer and work in S&T currently. To do a career change into S&T you absolutely have to have an MBA. So definitely go for it. To be honest, in S&T in general these days it is highly advisable to have an advanced degree. On my desk (commodities), I'd say probably 80% or more of our desk has MBAs, Masters, and PhDs. S&T is significantly more quantitative than anywhere else in I-banking, and as a larger proportion of the floor goes to derivatives and structured products each year, the advanced degrees are becoming almost a necessity (unless you join directly out of ugrad, in which case if you're good you can advance without going back to school--but as a career changers it is next to impossible to do it without coming directly out of an advanced degree program). I can only speak to US b-school, but Wharton and Chicago are the schools most highly recruited at for S&T. I have to run, but email me offline if you have more specific questions.

 

Thanks for the post - I have a Bachelors in finance, and a few years of unrelated work experience. On the doorstep of age 30, I'm realizing I really miss what I did in school, and want to change careers into the world of finance - S&T would be one of my top choices in the field (have some interest also in research, and M&A).

Sounds like I should be thinking hard about getting a top quality MBA if want to make this kind of move.

 

hey sorry for offtopic. but i am very interested in military experience. thats one of the reasons i considered going into medicine(i would get to spend a few years in the military). as i'm finishing up my ugrad with no business related work experience, it just occured to me that perhaps i should go in the military as an officer for 4yrs. Could that be used as a backdoor to a top mba? would schools like insead or top american schools look favorably on military officers? i'm also very interested in europe, though east europe at the moment. do people who graduate from insead(u.s. citizens) get automatic work permits in EU?

 

Hi b333b,

From my discussions with some of the various MBA programs in the US and Europe, they all value candidates with military experience. As a junior officer, typically a 22-23 year old, you are a leader and already supervising a 30-40 person platoon. Plus, with a war going on, this is an experience unequalled in any other profession.

Now, I'm not saying let's go out and make war, but you need to examine your intentions for becoming an officer. If it's just for the experience in order to get you into a top MBA program down the road, I would seriously question your judgment. If it's for other reasons like a desire to serve, the physical/mental/emotional challenge, travel, meet many different people from diverse backgrounds, etc., then OK. Trust me, you don't want to use the military solely as a "stepping stone" to something else. Many people do it, but what I find is that most of those people started to grow tired of the military and it showed. It's not fun working with or around that attitude. Plus, these are very unique times we are in, and definitely not for the faint of heart. Lives are at stake, so you need to be dedicated to the profession. I chose to leave, because I honestly wasn't enjoying it anymore. I don't want to be miserable in a career I don't enjoy, no matter how well the Army took care of me, which they did. The worst thing that you can do in the military is that you're just there taking up space. Everyone feeds off the motivation of others, so if you're not happy and motivated about being in the Army or at least your specific job, then I wouldn't recommend this.

However, don't get me wrong. I highly recommend the military for everyone, because it's experience you really can't get anywhere else. I was very gung ho about the military before I went to West Point and following my commission 5 years ago. However, my last 2 years, I had doubts about making the Army "my calling." Nonetheless, I wouldn't trade my last 9 years as a cadet and officer for anything else. All of the experience has made me into the person I am today, and I am grateful for it.

OK. I'm off my soapbox!

All the best,

William

 

Can't hurt. One of the recruiter training programs I went to for capital markets a couple years ago emphasized military service as one of the ways of meeting the leadership requirements the firm was looking for in candidates. That said, someone with military experience will probably be advising the hiring manager on your resume, so if you were managing supplies at a base in the US, that might be less competitive than being the chief nuclear engineer on an aircraft carrier. (Either way, thank you for your service)

That said, for a non-graduate hire, the firm is probably going to be more interested in previous relevant work experience. It would be good to get someone from HR's take on this, but I would think your best bet is to go back and get an MFE from a school like Princeton, Chicago, or maybe Carnegie-Mellon or Stanford so you can be evaluated as a candidate for the analyst/associate program rather than an experienced hire. Better to be up against D1 quarterbacks and state senators than a trader who netted $50 million last year and a long history of making money.

 

Absolutely. But it is highly unlikely you'll get any finance job straight out of the military, especially in this environment. It's possible, but rare.

The best route is to go back to school, preferably an MBA.

I did that. As an MBA with a military background you will get looks from every bank, and for pretty much any position. The MBA gives you the clean slate, and banks, consulting firms, etc. absolutely love the military background.

 
skins1:
Absolutely. But it is highly unlikely you'll get any finance job straight out of the military, especially in this environment. It's possible, but rare.

The best route is to go back to school, preferably an MBA.

I did that. As an MBA with a military background you will get looks from every bank, and for pretty much any position. The MBA gives you the clean slate, and banks, consulting firms, etc. absolutely love the military background.

An MBA is great for banking.

For trading, you really want an MFE.

 
Best Response

Not true at all.

S&T is a major career path at all top b-schools. In addition, MBA programs already have the recruiting infrastructure in place that other master's programs do not.

My b-school class alone sent around 60 people to S&T, with a split of probably 50% trading, 10% structuring, and 40% sales. And keep in mind that structuring is part of sales on many desks, and on desks like commodities the sales and structuring roles are as quant as the trading roles, and often times more quant.

The banks take far more people for S&T from MBA programs than from any other graduate programs. Every associate class I've see at any investment bank is almost entirely MBAs, with other's masters and PhDs scattered around--but still mostly MBAs.

Now from a practical point of view I do agree that the content of the MFE is probably more valuable, but your chances of obtaining a position are higher at an MBA program than at an MFE.

 
skins1:
Absolutely. But it is highly unlikely you'll get any finance job straight out of the military, especially in this environment. It's possible, but rare.

The best route is to go back to school, preferably an MBA.

I did that. As an MBA with a military background you will get looks from every bank, and for pretty much any position. The MBA gives you the clean slate, and banks, consulting firms, etc. absolutely love the military background.

The few guys at JP i know were MBA hires. I agree with Skins 100 % on this

 

I went to Wharton, so that's what I was referring to when I mentioned the stats of my class.

The idea that an MBA is better for sales than trading is absolutely false--more people from Wharton, Chicago, etc. go into trading or structuring than into sales. In addition, on some desks, like commodities, the sales role is just as quant as the trading role.

To IlliniProgrammer: no offense intended, but your sample size is pretty small (i.e. liquid markets). I know for a fact that at all major investment banks MBAs make up far and away the largest proportion of the incoming class-far more than any other masters or PhD programs. You can't really argue that fact.

And they go into all major areas at these banks. I've worked at 2 investment banks, and at both the MBA was far and away the most represented advanced degree. And MBAs routinely went into all aspects of S&T, and across all desks. And this pattern is the same across all the IBs, and all desks.

I'll give a specific example: top 3 commodities desk. For analysts they hire ugrads with primarily engineering or maths degrees, and with strong programming skills. For associates it was entirely MBAs from the more quant-oriented programs (i.e. Wharton and Chicago, with some Harvard, MIT, Columbia, etc. in the mix). Those MBAs in turn all had engineering, science, or math degrees in ugrad. The sales people all built their own models and could program to a decent degree, similar to the traders and structurers. Then there were a handful of other master or PhDs, but less than 10% of the desk.

The MFE programs like Princeton that you mention above are amazing programs, but they lack the recruiting infrastructure that MBA programs have. I'm not saying that it should be the way, just that it is. An MBA at Wharton has far greater access to the investment banks than any other masters of PhD program, simply because they banks have been going there for decades, and have a limited recruiting budget, so they go where they get the most bang for the buck.

Now if you are talking about small trading shops, then I'm sure there aren't many MBAs running around. And at more quantitative hedge funds PhDs probably represent a larger chunk than MBAs. But at any investment bank and at most hedge funds MBAs are the most represented.

And to the original poster--as a former military officer and MBA that went into S&T, I stand by my recommendation that you should pursue an MBA. If you need specific info about the military side of this please feel free to IM me....

 
skins1:
I went to Wharton, so that's what I was referring to when I mentioned the stats of my class.

Not to call you out or anything, but I looked at Wharton's employment report for the past 7 classes and the largest number of people going into S&T was 41 in 2008. The average for the past 7 years was around 26. (So the numbers for 2003-2007 and 2009 would have to be lower than 26 on average)

http://mbacareers.wharton.upenn.edu/report/CR_past.cfm

 
skins1:
To IlliniProgrammer: no offense intended, but your sample size is pretty small (i.e. liquid markets). I know for a fact that at all major investment banks MBAs make up far and away the largest proportion of the incoming class-far more than any other masters or PhD programs. You can't really argue that fact.
You are referring to associate programs. Where I work, the analyst program I was in was about 50% MFEs.
And they go into all major areas at these banks. I've worked at 2 investment banks, and at both the MBA was far and away the most represented advanced degree. And MBAs routinely went into all aspects of S&T, and across all desks. And this pattern is the same across all the IBs, and all desks.
Fact: A traditional MBA and non-quantitative undergrad degree alone can't qualify you as a quantitative trader, or even someone to work in the more complicated fixed income products.

Sample requirements for trading positions at top-tier prop firms that post positions online:

http://www.suntradingllc.com/index.php?option=com_content&view=category… http://www.suntradingllc.com/index.php?option=com_content&view=category… http://jumptrading.submit4jobs.com/index.cfm?fuseaction=85327.viewjobde…

Heavy focus on quantitative and technical competencies, often requiring a graduate degree in a quantitative discipline; less focus on management education.

Wharton's a great program, and if any American MBA can help you with trading, it's Wharton's, MIT's, or CMU's MBA-MSCF. That said, the program's real strength is in portfolio management. If I want to go work for a Vanguard or if I want to work for a hedge fund that takes longer-term positions, I'll shell out $100K for Wharton, but if I was in a different industry and wanted to get into algorithmic or quant trading, I would go for a $40K MFE with a strong placement record. Chicago, Princeton, CMU, NYU, and Stanford are all good examples.

The MFE programs like Princeton that you mention above are amazing programs, but they lack the recruiting infrastructure that MBA programs have. I'm not saying that it should be the way, just that it is. An MBA at Wharton has far greater access to the investment banks than any other masters of PhD program, simply because they banks have been going there for decades, and have a limited recruiting budget, so they go where they get the most bang for the buck.
Indeed. Most graduates of Princeton's MFE program are simply placed into positions and aren't even required to interview, and many of them head directly to hedge funds rather than BBs. Frankly, as someone who didn't go to Princeton, I find this infuriating. :D I had to fight tooth and nail to get in; I'm guessing you may have had to, too.
And to the original poster--as a former military officer and MBA that went into S&T, I stand by my recommendation that you should pursue an MBA. If you need specific info about the military side of this please feel free to IM me....
Just make sure you also get opinions from sources on Wilmott.com and QuantNet.com as well.
 

Thank you to all of those who have made responses and contributions.

In regards to the MFE vs MBA to S&T debate, last December I met someone who received an MBA from a top b-school (Stanford/HBS/Wharton) and works/worked as a prop trader at a major BB bank (MS/GS/JPM). I know it’s just one case but I figured it worth mentioning. His/her rational for getting the MBA was that it allows you network well and break into different sectors.

skins1, look in your inbox. I sent you a message.

 

The current hiring environment is overall still depressed from what I've heard. Not quite as bad as last year, but your best bet coming from Penn State is tapping into that huge alumni base and networking your ass off...that or any guys you can find on the street that were in th emilitary would probably also help.

Maybe a place to start is talking to some guys in our Wall Street Military group. //www.wallstreetoasis.com/group/military-wall-street

My buddy at Morgan says they are hiring many trading positions you mentioned. also, some Penn State guys at Goldman as well so might want to do some networking there as well.

Good luck and thanks for your service, Patrick

Elite GMAT Tutors: //www.wallstreetoasis.com/page/one-on-one-gmat-prep Invite Monkeys Here: //www.wallstreetoasis.com/invite WSO Guides: //www.wallstreetoasis.com/wsoguides Follow WSO on Twitter: http://twitter.com/wallstreetoasis

 

First of all, let me thank you for your service. My brother's been in going on 10 years now and I'm incredibly grateful to anyone and everyone I come across who gives of themselves for our greater good. Thank you.

Second, don't put your real name on here, it isn't wise. Other than that, there's a guy you should PM, I forget his name because he changed it but I will try to find it for you. He placed straight from military to PE bypassing his MBA or something ridiculous like that.

Also, at my firm we just hired a Navy guy 15 years in straight to the desk starting after all the summers left. It happens. Military is one of the strongest networks on the Street, there are a lot of veterans and they love to see others making their way in.

I am permanently behind on PMs, it's not personal.
 
A Posse Ad Esse:
First of all, let me thank you for your service. My brother's been in going on 10 years now and I'm incredibly grateful to anyone and everyone I come across who gives of themselves for our greater good. Thank you.

Second, don't put your real name on here, it isn't wise. Other than that, there's a guy you should PM, I forget his name because he changed it but I will try to find it for you. He placed straight from military to PE bypassing his MBA or something ridiculous like that.

Also, at my firm we just hired a Navy guy 15 years in straight to the desk starting after all the summers left. It happens. Military is one of the strongest networks on the Street, there are a lot of veterans and they love to see others making their way in.

Appreciate it, and have redacted my name. Figured I've been here long enough that anybody who is still around from the old days might remember me from it. Anyway, I've spoken with several people, but it all seems to be "informational" thus far, and hasn't led to any actual job interviews per se. I will keep at it, but I'm confined by geography at the moment. Clearly the job mkt for traders isn't great right now, esp at the BBs, but I'm trying to increase my exposure to folks who are currently in the industry to get a better feel for how best to get somebody's ear. I think that if I can get in the room, I can at least present a compelling case. Thanks again.

 

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I am permanently behind on PMs, it's not personal.

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