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Since it's my lucky day... and the market just closed four minutes ago... how did YOU do?
But there are markets that are open after 4 pm. And some that close long before that.
Jimbo
Well aware of that, thank you for the reminder. Very kind of you.
Also... if one considers that weather and luck are both random and hard to forecast, then they are more similar than they are different. Wouldn't you agree?
I don't trade equities big guy. Good for my pa though.
I didn't ask WHAT you traded.
I asked how did YOU do. Assuming you're a trader of something.
I did fine thanks. Yourself?
whats your experience with people moving from banking to trading?
There is a fair amount of mobility within S&T. I haven't met anyone who has switched from banking to S&T though.
Me? Oh fine too.
Lovely weather we're having today. Do you think it will continue?
weather is lousy where i am but at least it's not raining
Must be. Not a lucky day for you I see.
Well, nice chit chat. Gotta go. Ta ta
Nice chatting with you too.
What is the real difference between Sales and Trading and corporate finance? What kind of people do you find in each department? Is lifestyle/pay different between the two?
They are both contained in the I-Bank, but really different, right?
Pay at the junior levels is the same or very close to it. Both are part of ibanking but they appeal to very different people. Bankers are a bit stuffier in my experience. The projects/deals they work on take a long time; sales/trading work is more short term in its nature.
the lifestyle is very different. i've never worked a weekend in my life or stayed past 730. My days are about 11 to 11.5 hours long. My friends who did banking could work 80-120 weeks. Exit opps from banking are more varied.... you can't really go to PE from the sales/trading side for instance.
How long have you been a trader and did you transition from S&T?
I've always been in S&T
start in S & T. Ideally, I would like to do that too straight out of college.
start in S & T. Ideally, I would like to do that too straight out of college.
Don't think that weather is really that random. And luck is too loosely defined. I do agree that weather is hard to forecast. I had a stats prof once whose goal was a better weather model.
Do you know anything about Wachovia's sales groups, as in which are the best? How would their balance sheet give them a leg up in the industry?
And where they'll take the time to teach you. Everything else will follow. Don't worry about which is the "best". I don't know anything specific about Wachovia. The commercial banks like to sell the "universal banking model", but if you went to a lehman or a Merrill, believe me you'd do fine.
Perhaps weather isn't really as random, point taken. However, luck is never loosely defined.
Also, best bond trader started as a professional black jack player first. Go figure. Bill Gross. Met him once.
Bill Gross? Obviously I'm not a trader, but can I get some info (book, article) on this guy? Unless he worked at Salomon back in the 80's, I'm not sold. About half of those traders from '81 - '88 are living legends and still being talked about on the street. Where's their homage?
Though obviously he makes a lot. Didn't know that he was a pro blackjack player. I am just trying to get used to him without the moustache.
Curious, whom do you consider the "best"?
Bill Gross no mustache, eh? May be a mid-life-crisis-image thing.
I've met a number of excellent traders. I generally think you can learn something from most people. So I'm reluctant to single out one person as the "best". The best rates trader might not do well in a structured credit role and vice versa. So it's tough to compare.
Check Gross out next time he's on CNBC. Won't be any later than Dec 12. Unless he's grown it back by then....
Jimbo
Indecision about who is the best is a sign of weakness :-)
My impression was that a good trader should always have conviction.
jk
Maybe Steve Cohen or Boaz Weinstein
I can bend on who is the "best"
Gross moves the markets with his huge amount of money and influence to his advantage. Then he trend hugs, so he looks like he's often beating his benchmark.
He's better at asset accumulation than trading.
If you transition from sales to trading, what kind of salary bump should you expect from your analyst pay?
I know it is performance based... but what is a typical 25-75 range for 1st year traders, then 2nd and third?
U don't seriously believe what you just wrote buysiderules, do you?
BTW... I like the phrase "trend hugs". Cute.
Also, I think you fellas might enjoy a silly read from DealBreaker earlier this month. The guy on whom the interview is based is such the smooth talker, for example:
"Intrinsic value is calculated by free cash flow and net tangible metrics. I use a convoluted software system that calculates the cheapest stocks on paper, and then do some tantalizing research with my forensic accountant, to figure the "actual" worth of businesses."
http://www.dealbreaker.com/2006/11/better_know_a_trader_chris_lah_1.php
It's a theory, I'm probably being too harsh. But I think he's better at asset accumulation than trading.
Meriwether and some of those other guys are probably better "traders", maybe not "managers"
That's a good guideline.
None
Hi Jimbo:
I'm a kid in college without much knowledge and I was wondering- do most desks in sales & trading use models just built in excel and vba? If not, what do they use? What about trading in more complex structured products? I suppose there probably is proprietory software for advantageous and fast trade executions, but probably they use other software packages for modelling- can you give me some examples?
Thanks.
"I'm a kid in college without much knowledge and I was wondering- do most desks in sales & trading use models just built in excel and vba? If not, what do they use? What about trading in more complex structured products? I suppose there probably is proprietory software for advantageous and fast trade executions, but probably they use other software packages for modelling- can you give me some examples?
Thanks. "
Most banks have their own proprietary/built in house software. It is not necessarily excel based. I've yet to see an FX platform that was excel based, for instance. We also have external data feeds from bloomberg and reuters.
Often it will be a combination...for example the bank may have built a variety of excel based add-ins that are used to price different structures. If you're in college and you can demonstrate excel and vba proficiency you will be ahead of many candidates. It's a good thing to spend time on, whatever you go into.
Jimbo
thanks so much for the great answer jimbo, you rock!
Let me know if you have others, I'm about to sign off though
What sort of desk are you on?
best way to break into credit derivatives structuring or trading?
Why are you interested in this product? The best way to get in is to first get into an analyst program at one of the banks. Then meet the ppl on the credit derivs desk and see if it's a match. Skillswise, learning some excel and vba will help.
Hi Jimbo,
How long is it generally from when you start as a grad (in S&T) to when you actually begin trading?
Cheers.
My interest: A lot of innovation + complex math involved.
Credit derivs aren't as math intensive as you may think. Maybe you want to work in an actual quant group.
The amount of time depends on the desk. FX spot juniors can be trading a bit in 3-6 months. Other desks can take 18 months or longer
Thanks Jimbo.
my math background is pretty heavy but I'm lousy at hard brainteasers and time-pressured proofs so I can't get quant jobs
also Quant seems pretty dead-end + I don't want to be writing and debugging C++ all day.
I have a question concerning the exit opps from a quant position at a rating agency. I've been told that the majority of people leaving join a structured finance team at a bank. However, I am curious if it is feasible to move to trading. Could someone please comment on this?
Thanks in advance
*extra information: mainly experience in credit risk (CDO, CPDO etc)
Do you have a phd in math or just a masters?
what desk are you on Jimbo? Nice to see someone from S&T on these forums which are otherwise flooded with IBD monkeys.
working on an MS right now, just finished ugrad
just trying to tilt the scale....
Jimbo,
I posted something to this extent on the main board but was wondering if you could recommend any seminars/courses, etc that would look good on a resume and help me learn more about trading. Thanks for the help.
what age did you get into trading, how much knowledge of trading did you have when you got into it.
...pinch off an ole loaf? Huh, do ya kiddo? Take a dump, or do you shit in your pants if things get heavy?
I know trading days are busy, but do you have any time during the day to pinch off a load?
Don't know about any specifically...a basic probability and stats class will help. Also a derivatives course could be useful, but no one will look for that high level of knowledge.
jimbo
Had no knowledge of actual trading other than equity trading in my personal account.
perhaps you've heard of them?
Is that the guy who defaulted on some kind of personal loan a couple of years ago? What was the deal with that? I remember reading something on it recently as well...
Jimbo-
Could you run through a typical day of yours? Are you happy with the trading lifestyle (versus the advertised banking lifestyle)? Thanks.
Not sure what else I'd rather do. I work from about 7 till 6. During the day, we handle customer flow, rehedge the book, help marketers with sales calls and market color. That's it in a small nutshell.
But Gross has a hell of a lot more impact on the markets than ranieri or meriwether (when he's not blowing up).
what do you do exactly vadremc?
Jimbo-
Where do salespeople rank in terms of the sales and trading totem pole, although s&t is clumped together from what ive read they are very different jobs. Are they treated with the same kind of recognition as trading or just as an support function of a banks s&t operation?
Also do you do Fixed Income or Equities?
Historically trading is a bit better respected but good sales ppl are worth their weight in gold. the lines are more and more blurred nowadays. they certainly get paid.
fixed income.
Jimbo rocks!
Hi Jimbo,
What can you tell us about the Prop Desk within an IB? Is the Prop Desk where all the best traders get invited to? When you're on the prop desk can you still rise through the usual ranks like Associate, VP etc?
Also, are there separate Prop Desks for different types of trading? Like one for equities, and one for fixed income?
Yes of course there are separate prop desks for different products. Titles are similar there, but don't fixate on titles. And no, prop desks are not some invitation only club that all the best guys are drawn into. Good flow traders are very valuable.
Can someone please try to answer my questions about Prop Desks?
Thanks.
Prop Desk- trade using the firm's balance sheet. You can rise through the ranks but it's doesn't matter (other than superficially) as much since much of your compensation is performance-related. Most traders are a combination of market-making and prop. There are seperate prop desks for different types of trading (even different strategies sometimes) but it really depends on the bank (and profitability).
interviewed on campus
What's the difference between "trading" and "investing", particularly on PA? I buy stocks and hold them for a month or so, an interviewer told me that's investing, not trading? Thanks for your help Jimbo!
not sure what the interviewer meant...i'd call a one month holding account in your pa to be trading. to me investing has to do with investment thesis and time horizon....
so when you talked about your PA, did you give really sophisticated reasons for your trades or just tell them you speculate on some rumors or thoughts that you think the companies are going? what would you expect the interviewee to talk about PA trading if you were the interviewer? Thanks!
i was not asked any PA questions. If i do ask, it's to figure out if they are interested in the market. So it's more like "what level did the dow close at" or "tell me about a stock you like".
I ask more fixed income focused questions usually, but very basic stuff for analysts and summer analysts....ie when prices go up, what do yields do? what is the current yield on the 10yr? If they nail those we move on to slightly more sophisticated stuff like the black scholes inputs....
Hey Jimbo,
Do most banks offer summer internships in sales, or, are those positions generally considered internships in trading?
they offer internships in Sales and Trading.
And they dont roll on shabbos.
It seems like you have been dispensing some good advice on this thread for quite a while now. Since you are on a FI desk, you may be able to help shed some light on this for me.
I have been involved in the RMBS market for a few years (via a smaller regional originator), and have been trying to move to a desk at one of the BB's or to a HF. While I understand that my market is completely in shambles right now - god do I know this, i have had some decent interviews, but no bites yet (this has been over a 6 month time-frame). My suspicion is that my lack of participation in an analyst training program has been a major hurdle for most of the hiring managers. Do you know of any ways that I can overcome this? I have had intimate knowledge of both the origination and pooling of mortgages during the last 4 years. Wouldn't my experience and perspective be something that one of these guys would value? Or am I completely diluted?
Thanks in advance.
the lack of a training program isn't the issue...it's that you're not at a bank. i know vanilla rate sales guys who've come from the GSE's for instance.
i am assuming you are not nyc based? that is a hurdle too. are you trying to get on a trading desk or move to the origination side? your background might be better for DCM or something...
I actually am in nyc. My history is that I worked briefly as a jr. trader for a L/S equity HF out of school (2002) - if you can remember, that was a really down market and the situation was not what I had anticipated as a naive undergrad. In hindsight, this was foolish, but I have to deal with my current situation as it exists. I got recruited by a large mortgage originator and have spent the last 4 years moving from the origination side into the secondary side. I'd really like to get back into trading - nothing has satisfied me on a day-to-day basis like my short experience out of school. However, based on the last 6 months, anything that can get me headed in that direction is desirable. Thoughts? Thanks again.
Coming from an originator to the street, I'd suggest trying to get to the Capital Markets side of the originator; valuing whole loans, working with the underwriters and ratings agencies and trying to get a feel for structuring. Given all of those inputs, you'd be invaluable on a mortgage desk...
So, what is the ranking in trading? In other words, how can one become a proprietary trader? In IB it's analyst, associate, etc...less ranking in trading?
Also, if I may ask, why is your friend making 750k when he's already in he's 30s...I hear traders boasting their 7 figure salaries in their late 20s early 30s...i have a friend who makes 5 million and she's 29.
P.S. The question regarding compensation is merely out of curiosity not because I'm greedy...thanks!
did she go to MIT? Trades Agency MBS? I think i might know her.
she's hard to contact cause she's moving somewhere...that's why I turned to this forum and to you...cause you're respectable in this forum and I want to know whether she's talking trash or not....
And I want to know whether traders in general boasting about their 7 figure bonus are telling the truth or talking trash too...BECAUSE you talked about your friend in mid 30s making 750k...and you said that he's good!...Shouldn't he be making more?
So thank you in advance for your explanation.
you're getting confused between someone else who responded to you and me.
He is good. But there are no guarantees and the shop he is at doesnt pay that well I guess.
Now I'm confused I read about this friend of yours in a thread called "Perspective". I just wanted to know why you consider 750k good money when traders have been telling me that traders make 7 figure bonus in their late 20s early 30s. Perhaps it's 750k before bonus?
P.S. I think that 750k is good money but idk what traders think.
Approx what are the avg GPA's of the interns at your firm?
credit derivs math?
buy CDS @ 100, sell at 105. 5bpssizeduration = profit.
Jimbo, if you were a recent graduate of the class of 07 and had the opportunity to trade anything (equity, FI, derivatives, energy, commodities, etc.) what would it be?
i'd go where i liked the people and thought they would train me. that being said...i like the macro driven products, but that's personal preference.
1) What is the craziest thing you have witnessed on a trading floor? 2)Can you get me a job? Just kidding... ..
1)define craziest... we had someone eat every item in the vending machine in 2 hours once. 2)what's your background?
1) Well that would definitely count... I was thinking more along the lines of phones and office supplies being thrown at people, but hell thats even better 2)Going to be a senior at Michigan State this fall. Finance major. Currently doing an internship for a full service brokerage and commodity trader... Good EC's... GPA got f'ed my first two years (was a premed major)... Still above a 3.0, but below 3.5... And expected graduating major gpa will be around a 3.85... Interested in Sales more so than Trading (but I realize everyone goes in as an analyst anyways)...
Any other great stories you got please share, i love hearing them. Peace
1)eh...know of a commodity desk that told their analyst they were going to have physical settlement of a gold contract and that he had to go meet the brinks truck and guard the gold for the wknd. am still tired from last night so not much else of the top of my head. i've seen people throw things, but thats just unprofessional.
Jimbo,
I know you read my background from a previous post, but I wanted to reiterate and elaborate a bit on my trading experience. I interned at a very well regarded pure derivatives trading firm (not s&t side of a bank) and really had a bad experience with it. I was in a pit for the most part, but I also spent a little time in the upstairs office with some prop guys. Going into the internship I really thought s&t fit my personality, but then I got really turned off to it by my experience. However, everyone on the board seems to be saying that s&t at a bank is VERY different than what I experienced. Therefore, where can I get some more information/read up on what working in s&t at a BB is like? Also, if you would like more info on what type of trading internship I did and why I didn't like it, I would be more than happy to pm the details. Thanks.
Stupid question, but if everyone comes in as an analyst, do you get to ultimately choose between S and T or does the bank make that decision?
it's your pref, and their pref. it's a bit like rushing a fraternity.
can you comment on what a junior person would do in sales in an entry level position? (support of the more senior guys, maybe work on small accounts, what else?) I guess the consensus is that the pay is similar for pretty much all of the analyst level positions at an ibank is that right?
and thanks for being words of wisdom on this board.
Hi Jimbo,
Been reading the board for about a month or two, and have done a few searches. Just wondering if you could answer this earlier question. Oh, and can you comment on the travel opportunities/obligations of sales analysts?
jimbo,
I just got a job on a rates desk. was hoping I could ask u a few questions via pm.
ok
How do they/you determine who enters Sales and who enters Trading for first years? Which is more competitive to secure?
it's like fraternity rush. there are fewer trading roles in general
Hi Jimbo,
First, thanks for your time, really appreciate your posts...
Just so you understand my questions, here is my description: I'm a French student, completing a Masters in Market Finance in one leading French business schools. I'm now working as an equity broker in Madrid for the Iberian market for a well-known brokerage house, I'll finish next month. And I'm passionate about stock markets in particular, especially news, rumors, corporate moves, corporate strategies and their impact on Equities, and I would enjoy trading/selling equities and more complex products like exotic options.
I have a few questions concerning my future... 1) As a foreign graduate (08'), what are my chances to reach a NYC-London (or english speaking) prop trading desk? 2) Would it be recommended to join a prop trading desk immediately after graduating? 3) In terms of my maths abilities, my French upbringing is generally appreciated, but as I am a foreigner, would that be sufficient or should I combine my Masters with a diploma in maths from a French University ?
Once again, thanks for your help...
1) it's no worse than anyone elses. 2) if you can, sure 3) yeah i;d do the diploma if you could.
Jimbo,
What are some ways to brush up for s&t interviews that you would recommend. How about topics of questions that might be asked?
Thanks for the input!
been discussed before.
follow the markets, know levels of key indices, you'll be fine.
How would one become a structurer ? What does it take to succeed in that role? Thanks!
can one enter equity/FI sales right after college, or do they generally require an MBA?
can one enter equity/FI sales right after college, or do they generally require an MBA?
no mba req'd
So you talk about methods for modeling "rates." What exactly are you doing? Modeling the term structure? Estimating forward rates?
Bootstrapping. I'd like to forecast by running regression models (ARIMA, ARCH/GARCH, etc) and do hypothesis tests and stuff.
No it is not bootstrapping the curve....all banks if they wanted trade rates need to be able to build the curve accurately.
exotics are generally priced under various scenario analyses about what the future will look like
yes generating future rate scenarios under the frameworks of various models.
during 1st round interviews should we tell interviewees that we want FI/equities, sales/trading, specific products? would it overkill? or just generally 'sales&trading' is good enough?
Jimbo, just wondering if you have seen a lot of guys come from small colleges like from the areas of washington heights or queens or brooklyn?
not really, sorry.
Hi there Jimbo, well i want to get into the S&T business. I'm from a non-target and got over a 3.0 GPA relatively on the low side. I've interviewed with a BB for S&T summer internship but I didn't even get to superday.
I'm currently at a financial guarantor firm in the RMBS team. i'm going to be a rising senior and I really want to break it into the S&T business.
Why? Because
1)I love the energy on the floor. 2)I love to interact and meeting new people. I have good math skills. 3)I can think very fast on the top of my head. 4)I love keeping up with stocks and business news. 5)I perform very well the more pressure is put to me.
Please give me some advice. Thanks Jimbo.
well i cant give you specifics, but do you deal with rmbs traders at all? my suggestion is to network with them and maybe they think of you when a slot opens up.
Nope, we're in different floors. And I can't imagine if I can ever get close to them since we're in totally different functions...
i think i've answered before but junior sales guys will eventually cover small acounts. they cover when senior guy is gone and also monitor the market and tell him what's going on as he relays to clients. and they might book trades through or handle the actual execution with trading.
travel is mixed. maybe once a month.
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