Management consulting vs trading

Hi,

I want to get other people's perspectives on where to begin my career. I have offers from a top (MBB) consulting firm, and a second tier prop trading shop. I see a lot of consulting vs banking sort of questions, but I have no interest in IB.

I want to think in terms of money first, and lifestyle second.

The amount of money you can make in trading is significantly higher in the first few years out (around 80-100k in consulting vs 100k+ in trading), but I'm more interested in the long term.

Theres a good chance that trading as it is now will no longer exist in 10 years, and most of the skills you develop are useless. Obscure statistics and programming (and programming != software development). It seems that if you don't make it big in trading, you'll be forced to leave the industry without any useful skills (essentially just pushed your career back a few years) or be stuck in low tier job if your prop trading shop becomes marginalized and slowly withers away.

Whereas in consulting, the skills are more applicable to a range of industries, and there's the entrepreneurial aspect: start your own firm, control your hours and your income totally. I know someone who makes 500k per year, working maybe 6-9 months. There's also a long shot dream of becoming a big shot VC. There's overall more flexibility.

Any thoughts on other issues I need to consider, or how to make a decision? I'm not at all risk averse, but I don't want to make short sighted decisions potentially shut down even more lucrative opportunities. Obv if I had offers from Jane St or Getco, I'd take it immediately.

Thanks for reading.

 

Long-term plans evolve randomly.

As gay as it sounds, I would honestly choose whichever one you think you'll enjoy more right from the get-go. Plans like "I'll bear this for two years so that I can do X" tend to backfire.

 
Best Response
sherminator:
give an example of second tier prop trading, e.g. DRW / First New York / SIG ?

These places don't hire too many people each year, so I won't name the exact one. But something like DRW/Chopper/Allston. I consider top tier: Jane St, Getco, maybe Jump or Optiver.

I can see myself making 100-300k for the next few years, but I'm concerned about it maxing out, whereas in one of the top shops, your potential upside is much higher.

In consulting, you can make 80-100 for a few years, then 150-200 for a next few. But it seems like if I want to go start a business in India or China, then working in a no-name trading shop for a few years shuts that down?

 
takenpandora:
sherminator:
give an example of second tier prop trading, e.g. DRW / First New York / SIG ?

These places don't hire too many people each year, so I won't name the exact one. But something like DRW/Chopper/Allston. I consider top tier: Jane St, Getco, maybe Jump or Optiver.

I can see myself making 100-300k for the next few years, but I'm concerned about it maxing out, whereas in one of the top shops, your potential upside is much higher.

In consulting, you can make 80-100 for a few years, then 150-200 for a next few. But it seems like if I want to go start a business in India or China, then working in a no-name trading shop for a few years shuts that down?

lol you're retarded and leaving out the biggest and most respected firms. SIG and Timber Hill dwarf any of those 'top tier' firms in pretty much every aspect (size, amount of money made, markets they participate in, history, etc.) and DRW/Chopper/Allston trade completely different markets and products than JaneSt/Getco/Jump, which are nearly pure algo shops at this point. DRW/Chopper/Allston aren't even really all that comparable to one another in many ways, but that is another story.

Maybe you should do your homework before making dumb threads.

 

an idea: try trading, see if you like it/are very good at it. If not then pursue MBB again, either directly (I don't know if your career services would let you apply as a analyst after a year or two or trading) or by getting a top MBA. I think trading - MBB is going to be alot easier than the other way around and if you do MBB - trading and you aren't good at trading then you'll be a little stuck.

 
breakinginnew:
an idea: try trading, see if you like it/are very good at it. If not then pursue MBB again, either directly (I don't know if your career services would let you apply as a analyst after a year or two or trading) or by getting a top MBA. I think trading - MBB is going to be alot easier than the other way around and if you do MBB - trading and you aren't good at trading then you'll be a little stuck.

This is a pretty good point. Thanks!

 
cheese86:
They are such different jobs though, can't you determine which one sounds more appealing to you?

Theres pros and cons for each. I like math and programming, but I also want to learn more about different business areas in the actual economy.

 

I was in a nearly indentical situation, just substitute MBB to top boutique (Mars, Monitor), against prop trading (market making) arm of a BB.

Long story short, I picked trading.

My reasons: - Most importantly, trading is what I wanted from the beginning - I felt that if I ever realized later in life that trading wasn't for me, I could always make a move to consulting even if a direct lateral move might not be feasible. I guessed that moving to trading mid-career would be nearly impossible (would have to start from the beginning, if there is even a place willing to hire someone that old in an assistant role)

The factors going against trading was obviously its riskiness. I knew that if I simply worked hard enough at consulting, I'd get by while trading can be a lot more competitive. Frankly, what made the decision most difficult was that picking the consulting job would have allowed me to be in a more exciting city with my girlfriend. She was pretty pissed when I chose trading "over" her.


To add, even while rejecting the consulting offer, I knew that it could very well be a place I would work down the line. I actually visited the office after letting them know that I'll take another offer to mingle and personally thank all those that I interviewed with. The managing director asked me to stay in touch and contact him whenever I'm back in the city to hang out, and most importantly that I will be welcomed back if I changed my mind. Granted, I'm guessing something like this is easier with a boutique firm.

 

Wow, talk about completely different professions. Since you're interested in both I'm with breakinginnew here, try trading first, that way if you suck you'd get weeded out asap.

I'd pick trading though.

People like Coldplay and voted for the Nazis, you can't trust people Jeremy
 

Ps. I know banking is probably the best route, but I don't think it's for me.

Also, it might seem strange that I'm trying to chose between two very different roles, but Im really having a tough time figuring out where I should be focusing my attention

Thanks.

 

Go into banking. Better shot from both.

If you must choose between those two, I think consulting would be better since Trading will pigeon hole you.

-- "Those who say don't know, and those who know don't say."
 

who cares if its not right. They'd fire you in a second.

Do you want to do s&t? There's your answer

Because when you're in a room full of smart people, smart suddenly doesn't matter—interesting is what matters.
 

What do you mean they would fire me in a second? I haven't decided yet.

I like S T. but as i say, this is a 6 month training program and I have no sure % of being invited back for a permanent desk. The other offer is at least 3 years. Should I just defer the start date for the other firm and see what will happen? Since the other offer doensn't start until late end of 2013, can I just do the ST program to no collect unemployment and since I also want to give it a try?

I would appreciate all the inputs. I am trying to make a very difficult decision.

 
hihihohohaha2:
What do you mean they would fire me in a second? I haven't decided yet.

I like S T. but as i say, this is a 6 month training program and I have no sure % of being invited back for a permanent desk. The other offer is at least 3 years. Should I just defer the start date for the other firm and see what will happen? Since the other offer doensn't start until late end of 2013, can I just do the ST program to no collect unemployment and since I also want to give it a try?

I would appreciate all the inputs. I am trying to make a very difficult decision.

He means that the company does not care about you in the least, and would fire you in a heartbeat if they wanted to. Make the best decision for you, not your potential employer.

 

if you want to do s&t take the chance on it. By deferring the other offer, do you mean starting it six months later?

Because when you're in a room full of smart people, smart suddenly doesn't matter—interesting is what matters.
 

Yes. I really do prefer ST, however this offer is at the moment for for a permanent desk yet but still rotational, therefore, the other offer, which is 2-3 years is more secure.

Is it possible to defer the other offer, meaning starting it like early Feb 2013? and if i get invited back for permanent desk then I can renege on it later?

Thanks alot.

 

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