MBA's and Physical Commodity Trading

I am dead set on a career in physical commodities trading and would one day like to move up into management.
Anyhow, I wanted to ask anyone with physical commodity trading experience for their opinion on how they think the industry views MBA's.

How many physical traders do you know left the desk to get an MBA?

How did the senior traders/management view it?

Thanks a lot...

Commodities Trading Education: Do you need an MBA?

Not many physical commodities traders leave their desks to pursue an MBA. Upper management will not really care if do decide to leave for an MBA.

Be cautious about bringing this up to management. It is entirely possible that they let you go immediately if you tell them you are pursuing an MBA (especially if you are a junior).

Physical trading is the best way to get good at physical trading.

The degree will not help advance you into management. Making money for your desk is the best way to advance into management. It is not uncommon for the head of trading to lack an MBA.

from certified user @monty09"

The best route I have seen in going from physical trading to management in my 5 years is making money for your desk.

No degree will ever make money alone. If you can't get a trading job with your degree and need an MBA to make that jump, then you have your work cut out for you. However, I don't see a lot of post-MBA traders. I see a lot of post-MBA in sales, struct, etc

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Comments (19)

Sep 26, 2010 - 8:25pm
monty09:

you should work more then two years to learn anything. at year 2 you really dont know anything

Monty, I have a couple questions for you:

1) How long does it take for a trading assistant / trainee to understand at least a little bit about the commodities he is trading? It will of course depend on the firm and the specific product, but let's keep it general.

2) When will he start to put actual prop positions or be enaged in physical deals(aka become a trader)?

3) If the answer to either 1) or 2) isn't zero, what does he do in between? All trading assistants do grunt work on daily basis and it's their most important responsibilities I know, but I'm wondering whether there is a difference between asset classses. (commodities, especially physical vs. rest of the asset classes) Does he have to spend a lot of time researching, for instance?

Sep 26, 2010 - 12:05pm

Are you at a BB, a commodity trading house, or a major? Instead of getting an MBA, you should focus on getting into a major. Monty would need to verify this, but I assume the best mobility and opportunity to gain a larger scope of the physical side of the business would be at one of the majors (Exxon, BP, Total, Conoco, Shell, Chevron).

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
  • 1
Sep 26, 2010 - 1:39pm
Gekko21:
Are you at a BB, a commodity trading house, or a major? Instead of getting an MBA, you should focus on getting into a major. Monty would need to verify this, but I assume the best mobility and opportunity to gain a larger scope of the physical side of the business would be at one of the majors (Exxon, BP, Total, Conoco, Shell, Chevron).

you can learn a ton at either a large or small shop. I worked with starts up via bb's but it was a great training groud. I would put more stock into what you will be doing then where you would be doing it at. obv you would like to be at best brand but trading at shitty firm is better then mid office at bp

Sep 26, 2010 - 12:23pm

I am at a commodity trading house (think glencore/louis dreyfus/gunvor/noble).

I understand that I still won't know anything after two years, but that is still not much of a concern, since I plan on going right back into the industry as soon as I finish the MBA...

Anyhow, as far as not letting them know until I am accepted at school, who then, do you think I should ask for a letter of recommendation? A client I worked with? I am told that B-Schools are pretty admant about having professional references (i.e. not just letters from professors)

What do you think would happen if I told my superior something along the lines of "I know I just started, but I would like to go to business school two years after having joined you, with the intention of coming back upon graduating"?

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Sep 26, 2010 - 1:37pm
ado88:
I am at a commodity trading house (think glencore/louis dreyfus/gunvor/noble).

I understand that I still won't know anything after two years, but that is still not much of a concern, since I plan on going right back into the industry as soon as I finish the MBA...

Anyhow, as far as not letting them know until I am accepted at school, who then, do you think I should ask for a letter of recommendation? A client I worked with? I am told that B-Schools are pretty admant about having professional references (i.e. not just letters from professors)

What do you think would happen if I told my superior something along the lines of "I know I just started, but I would like to go to business school two years after having joined you, with the intention of coming back upon graduating"?

those are all very different shops and none highly value a MBA. LDH did a few years ago but thats done with.

getting a mba to go right back into the industry is not a very good idea. the best exp you can get in phy trading is well phy trading. no mba will help you. we have ivy guys in my office with mbas and none are in trading.

you can have anyone writing for you but know that what you bring to get table(getting a mba) is pointless to your manager. i thought the same way until i got a little more info from others. you can be walked out and like I said i seen it twice.

if you told me that I would write you off and you would not be coming back to my firm. I am leaving for a mba and have no thoughts of ever coming back. AND I WORK FOR A GREAT FIRM... sucks but how things work

Sep 26, 2010 - 3:14pm

I don't think anyone on the desk has an MBA, but the some of the guys at the very top definitely do (i.e. the ceo, cfo, etc..)

like I said, these guys are managing shipping fleets, mines and ports in addition to the trading business, which is why I assumed a more traditional education in management might be a good way to complement trading experience when trying to climb the ranks

Sep 26, 2010 - 6:16pm

the best route I have seen in phy trading to management in my 5 years is making $$ for your desk.

no degree will ever make $$ alone.... if you cant get a trading job with your degree and need a mba to make that jump then you have your work cut out for you. however, i dont see a lot of post mba traders.. i see a lot of post mba in sales, struct, etc etc

Sep 26, 2010 - 6:25pm
ado88:
well i guess marc rich didnt even finish undergrad right

i dont think bringing up folks like rich, hall,maggi,arnold really have any matter here. I would focus more on typical management in a firm...

if you look hard enough you can have a solid point on getting the MBA.. if I just open my eyes in my firm i also have a strong point.

Dont swin upstream if you dont have to. Thats my only point.

Sep 26, 2010 - 11:23pm

i understand all phys comm traders used to have to put in a couple years in traffic before moving into trading

i think nowadays stints in risk management or trade finance can be susbtituted for working in logistics/chartering

Feb 7, 2013 - 12:34pm

Good Day,

I have a question: I have been working in ops in a major for one year, and starting to get more and more interested in becoming a trader...However, the chance is not there...yet...I am thinking of taking the trading certification in Genivea..would this at least give me a chance to get a trading job in another trading company?

Best Response
May 22, 2013 - 1:46pm

If you want an MBA, go get it... HOWEVER, if you are already at a house, working on the floor in a development program, then you are already where a career changing MBA (me) is trying to get to post degree. Stick around the business and learn from the job, That knowledge is more valuable then the large amount of BS you will encounter in Business School. You can knock out the first year of business school by picking up one book on financial statement analysis, a little bit of Michael Porter strategy, and Marketing for dummies 101. I consider getting my MBA a tactical error, and although it helped me transition from the service to a civilian job, in hindsight, I would have rather had job experience and done an exec or night program (many times a firm will help pay for with tuition assistance). Additionally, if you are in one of these TDP roles, I assume you are in the greater NYC, CHI or HOU area, in which case there are great options for nightime/exec. Booth, Columbia, UT Austin for example.

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