Prop Trading - Commodities?

Hello guys,

I am currently an agricultural commodity trader at ABCD type of firm. I am thinking of getting into the prop trading industry but I am not sure if my background is a fit as commodity trading is quite different. I am also not from a quantitative background. I have seen that most people have recently applied to notable prop firms like Jane Streets, Flows, Optiver etc, but they seem to be the most CHALLENGING to get in as well. I also believe that they prefer someone from a quantitative background. Would like to ask if there is any prop trading firms with a commodity trading desk? How difficult would it be to enter these firms?

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Comments (16)

Mar 15, 2021 - 8:57am

GoodBread

Not prop per se but multimanager HFs like Citadel or Millenium have commodity teams.

Oh ya I look it up on their website and I see it. Do you perhaps know what their focus is? I imagine that they are mostly involved in derivatives and not the physical book. I also reckon that they usually require at least 5 years of experience? Correct me if I'm wrong.

Mar 17, 2021 - 3:44am

If you want to join a multi-manager as a PM you're going to need a serious strategy and track record. 

As an analyst you'll have to demonstrate that your research process can add serious value to an existing team. Citadel certainly do have an ags team - suggest you use your network to get in front of them. If you are indeed a trader at ABCD, brokers should be willing to help you out with an intro.

On the prop trading side you are essentially going to be re-starting your career. Aside from the basics of futures and options there is very little crossover between what a sophisticated prop shop is doing and the paper desk at ABCD - they are light years apart. If you're serious about this path my advice would be to seriously upgrade your technical/quant skills otherwise you don't really have a chance.

Most Helpful
Mar 17, 2021 - 11:29am

Caporegime

If you want to join a multi-manager as a PM you're going to need a serious strategy and track record. 

As an analyst you'll have to demonstrate that your research process can add serious value to an existing team. Citadel certainly do have an ags team - suggest you use your network to get in front of them. If you are indeed a trader at ABCD, brokers should be willing to help you out with an intro.

On the prop trading side you are essentially going to be re-starting your career. Aside from the basics of futures and options there is very little crossover between what a sophisticated prop shop is doing and the paper desk at ABCD - they are light years apart. If you're serious about this path my advice would be to seriously upgrade your technical/quant skills otherwise you don't really have a chance.

Thank you for your message, you gave me a good idea of what I should be doing. I believe that multi-manager isn't what I am exactly looking for, a career option at ABCD would offer more opportunities in the commodities industry compared to multi-manager. I am in fact trying to move over to prop trading side. I'll also take your advice to upgrade my technical & quant skills thoroughly till I apply for the job. Thanks! 

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Mar 15, 2021 - 5:17am

They (JS, Optiver, Flow, etc.) don't give a shit about your background honestly, they just care about how smart you are. Not coincidentally, most smart people come from a quantitative background. I'm sure they'll give you a shot at the mental math tests with your background. 

Mar 15, 2021 - 9:02am

NuclearTrader

They (JS, Optiver, Flow, etc.) don't give a shit about your background honestly, they just care about how smart you are. Not coincidentally, most smart people come from a quantitative background. I'm sure they'll give you a shot at the mental math tests with your background. 

Thank you for the inspirations! I will definitely give it a shot to JS, Optiver, Flow - but they are indeed very competitive so I will not get my hopes too high up. Do you by chance know a lower-tier but still great kinda prop firm which is easier to get into? not the bucket shops though..

Mar 15, 2021 - 9:49am

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