So this form is always pretty good about circulating compensation. The junior staff is always very good at posting. BB on the street first 1-3 years out tend to make between 70+30, than I'm guessing 100+40 with premium young guys making total comp approaching 200 by their third year. Guys who did not make it into the private suite have to sit in the club seats. They make more in the 80 total comp range and hit 100 after three years. I think these numbers are all in the ball park.
What is interesting to me is the growth potential down the road. What are these positions making at 5 years down the road? 10 years down the road?
I have a friend on the buy side (mutual fund) that says bonus comp really doesn't compete with the sell side. So really, what is the average BB employee making at age 26-30? What is the most baller 28 year old you have ever heard of?
Very rough #s
ASC: 300-500 VP: 500-800 D: 800-1200 MD: 1200+ VC: 5000+
someone recently posted an article on here refering to a 28-yo trader who left $11 mil on the table at MS for $25 mil at a HF
I don't post on total comp, but I'll say that "these positions" are often burnt out after ten years. Most college students think this is odd or crazy, but they forget that bankers don't get summer break and six weeks of vacation during the school year on top of that. We get three weeks- if we're lucky.
The most "baller" 28-yo is probably running his own hedge fund. Actually, the guy who will be the most baller 28-year old is probably some geeky CS major at the University of Mississippi who is developing a replacement for Google in his basement. If you're 28 years old and still working for someone else, you may not necessarily be the most baller.
you're referring to this article.
http://www.bloomberg.com/apps/news?pid=conewsstory&tkr=MS%3AUS&sid=at1af1WVPaG4
In all honesty, I completely understand the argument about "working for yourself".
However, if you're a 28-year old trader and can tell Morgan Stanley to shove their $11 million for some hedge fund's $25 million offer, then you probably have no problem working for "the man".
CD~
how is it even possible for a 28-year old to make that much on the sell side? he's probably a VP at most.
You need to understand how sales and trading compensation is allocated. Compared to investment banking, the earnings are volatile. For example, if IB compensation deviates from the mean, +/- some value x, trading earnings can deviate +/- 5x!
So if the desk has a blowout year, the trader's responsible for those earnings will receive bonuses in accordance with those earnings. Also note that in IB, you typically know at the beginning of a deal, just how large the notional value of the transaction is. In trading, right up until the cut-off date for bonuses, the trader can swing to a massive profit or massive loss.
Also, get this notion of "my-title-is-proportional-to-my-earnings" out of your head. On a trading desk, if an associate's PnL outshines that of a VP, then he'll make more than the VP, no questions asked. It's much closer to a meritocracy than most other areas.
CD~
I thought analysts and associates at S&T get roughly the same bonus as their counterparts in IB?
on average both IB and S&T get paid the same (slight edge to IB). What we're saying is: it is easier to be a superstar in a junior position on a trading than it might be in an IB group. The reason being: IB is still very hierarchical (analysts and associates do the leg work on a deal, making their VPs and MDs look good).
On a trading desk, I've seen 2nd and 3rd year analysts who've been trusted to run an entire options book. Good luck trying to hang on to that star 3rd year analyst if your not going to pay him for that star PnL.
So yes, if your S&T analyst is still booking trades and grabbing coffee, then his IB counter-part will pull the same (if not slightly more) in compensation. However if your an analyst who's been given the book and told to run with it... you are going to outshine everyone at bonus time (assuming your PnL lives up to their standard)
Notable examples: Jason Strasser-Morgan Stanley (3rd year analyst)
Jason Strasser? The guy went to duke undergrad. He was an online poker superstar back in college and then went into finance. I heard that he was doing pretty well for himself.
As far as I know he trades equity derivatives.
Read The Quants by Scott Patterson, those are the true ballers. The Delta between an IBD and a Quant compensation is Ginormous, you have to be a Superstar to make it in the big leagues.
Superstar traits:
Pretty much a Rockstar zero carb...... ALL of the FUNK none of the JUNK.
Almost forgot.... Whoops your ass at liar's poker every time and loves to play hold em'
Superstar traits: - Uses totally unnecessary greek finance symbols such as Delta and Alpha when discussing the most elementary topics such as year-end bonuses, so as to assauge his insecurity and demonstrate his superior finance knowledge. - Busts out painfully corny expressions such as "all of the funk and none of the junk"
I'm pretty sure that by the time I retire, the trading floor I work on will be replaced by banks and banks of multicore mainframes making trading decisions. Computer Engineers and Physics/Math PhDs wearing black thick-rimmed glasses and white lab coats with pocket-protectors will be walking across the floor checking off boxes on clipboards just like we had in the '70s. Maybe the traders and sales guys who didn't save for retirement will be helping to replace CPUs and fix machines when they go down. It'll be the revenge of the nerds all over again!
Quants are definitely pretty smart folks, but they generally report to the trader. I say this as someone who has an odd mix of quant development and TA responsibilities and sometimes works with them. They're not necessarily good liar's poker players- or any other form of poker for the matter, but can they put together a black-karasinski callable bond pricing model together in their sleep? You bet. Is it a great life if you have a PhD ant want to work in industry? Abso-friggin-lutely.
Everybody on the trading floor- and at the investment bank- from the guys in IT to the folks in ops to the quants and traders to the investment bankers has their own job to do and at most well-run banks, you find that everyone does their job extremely well. Ops, IT, Analytics, Risk Management, and Quant Strategies/Research (AKA the "pocket protector crowd" as some called us : D) usually got ignored by the media because our jobs didn't sound cool enough. As someone who spent a couple years in Analytics, this is a welcome change.
@ IlliniProgrammer: thanx for backing up my post
@ prospie: Don't take your bad day out on me, my posts are nothing else but a monkey's opinion.
Why are we throwing research in with this group? Not a back office role...like some of the others.
no matter how much i try to educate, the ignorance about trading on these boards sometimes is just astounding. some of you guys are exhausting. where do you get this dubious information from??
anyway to answer the OPs question: the first response (asc-md) from macro is not far off from pre mortgage meltdown levels. you know how i can confirm? because i lived in the neighborhood around those brackets, not because of some bs i amalgamated from a few boards here and there.
yes, strasser trades single name equity options and runs the technology stock options book at MS
That seems right. He posted on the 2+2 forum a few years back about his decision to pursue finance rather than poker. He also got an offer from JP Morgan's commodities desk even though he graduated Duke with a below 3.0 GPA. I guess his poker prowess really impressed the banks.
How do you know about Strasser?
Wow. Unreal that he got offers from those firms with a sub-3.0 gpa. That's practically impossible to do.
Running a good amount of money at a hedge fund when u r 28 years old or being able to take large risk on the sell-side before the age of 25 puts you in the top 1% of traders at that age. Probably the top .1%. To get to this point you need to be good but just as importantly you need a tremendous amount of luck...and i say this as someone who has done it. Discussing this very small sub-segment of traders to answer a question about comp is somewhat irrelevant.
I also would quarrel with a few of the "superstar traits" listed above. Being "way smarter then you", "kicking arse at everything", "being success driven, not money driven", "can do models and bottles until 6am", and all the other stuff you wrote there have nothing to do with being a good trader. I have been quite successful for some time now and I'm not a genius, i kick ass at practically nothing other then trading (and i have plenty of moments of doubt about that), I am driven 100% by money, and I sure as shit can't do models and bottles until 6am since i have already been at my desk for 30 minutes at 6am. I also didnt just "wake up one day with a sick trading strategy", I learned the craft of trading by watching others succeed and mostly fail, reading all I could about the subject, asking intelligent questions to traders i respect, and making a few of my own mistakes along the way.
And I think poker is boring.
I believe CreditDerivatives is starting as an FT at MS Equity Derivatives in the summer, so he probably met him
Being a good trade takes: -confidence (also known as BALLS) -luck -determination
You don't have to be the smartest guy in the room.
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