Pay expectations for junior very successful prop trading model
Hi all, longtime lurker here that needs some advice..
Lets say you've just joined a trading desk at a bank a few months ago as the junior, doing all the usual junior tasks and hedging small stuff etc..
On the side at work I started working on all old trading strategy one of the traders (my 'boss' really) was working on which was already relatively successful but had some drawdown issues meaning it wasn't a pleasant strat to run. This new improved version looks extremely promising and looks like he's gonna create a new book just to trade it in size and conservatively looks like it'll make 10/20 bucks this year with scale to increase a lot.
I'm confused about what I should be asking/expecting.. Ultimately I'm on the grad programme which looks like it's gonna pay me a donut this year, but I should make associate next year (regardless of this strategy). Is there anything I should ask for/talk about before we get deeper into this thing? Compensation? I guess I'm looking for formal recognition of my contribution to this pnl (maybe the book should be shared?).. The thing is I've really only just arrived and don't even have my own book yet.
Thanks for your advice!
"it'll make 10/20 bucks this year with scale to increase a lot." Good luck.
i'm not here to debate the strategy or pnl estimates, can you give any advice though?
Sure - it's not your strategy, so you won't be getting credit for it. And you shouldn't as you've only added some cute excel functions to it. If your boss likes you and you have a good year, there is no reason why he should'nt pay you.
You just started so you are at the bottom right now, what are you chances to move to a competitor? I think I can safely say zero - so you are worth zero in the eyes of your employer. If you are worth zero why should they pay you more than they would have to? You'll get whatever other grads are getting, and if you are good you will be in the top bucket of your class.
If you are in a small shop it might be different. If it's a big company forget about it.
"it's gonna pay me a donut this year, but I should make associate next year" - are you at CS? Don't know too many other firms who will move you from analyst to associate after only a year (you've started in june i assume from your post)... If you are at CS, look at how well the company is doing, if you get some cash this year you should be happy. As what they will tell you, like any other banks would: be glad you have a job. Especially in the prop business... Unless you are into one of those "internal hedge funds" aka new name for prop desk to get past legislation issues.
You will get the donut as promised. You deserve nothing. The chance to learn and build a successful algo and strategy is a bonus enough. Expect nothing, it's a prop show.
Now the question is can you do this again? Could you improve even more? Do you fully understand it? Could you do it without the firm?
thanks for the advice guys
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