12/12/09

Sales and Trading - What Is It?

There are two primary functions to sales and trading. Here is a basic idea of each of those functions:

  • Sales: Pitch the firm's ideas to clients to sell securities and build relationships with clients.
  • Trading: Trade securities, typically in two ways (there are other means of trading, see "Different Kinds of Trading" for more on that): trading for the client or trading with the firm's capital (called agency trading and prop trading, respectively).

Prop Trading vs Hedge Fund Trading

Prop shop trading and hedge fund trading are two different beasts that are frequently mixed up. Here are the differences between the two, explained succinctly, from @derivstrading.

Prop shops, in general, are smaller and more nimble, and try to extract nickels from all over the place due to inefficiencies. (Some do it with statistical models; some with speed of execution; etc.) That is why you usually find prop shops in liquid and exchange based products, such as options and cash equities, for example. They tend to have very low overheads and capital requirements and are therefore usually seeded by the guys that started it/run it. There aren't outside investors, such as pension funds. Therefore, the absolute amount of money might not be huge compared to HFs but it stays in the firm. If you have an HF that has 1bln of capital and they make 20% or 200mln, they get to keep 40mln in performance fees for compensation. For a self-funded prop shop with no outside investors, to get the same comp payout in total for the same 20% return on capital, you would only need 200m of capital. Prop shops tend to be smaller, however, but you can see why payouts can be quite high for them.

So why are hedge funds all the buzz in the finance world instead of prop shops? There's less influence on your trading from outside forces, less overhead, and less capital required for the same returns.

One huge difference between the two is in the investing style. Hedge fund trading is more along the route of what is traditionally known as investing, while prop shops operate more along the line of short-term trading. Prop shops hold securities for a much shorter period of time, and they try to squeeze out a quick profit from those holdings.

Another reason is that trading, in general, is a dying field.

Why Is S&T a Dying Field?

S&T has been a shrinking field for years now. Here's the main determinant from @big unit, who refers to the trading floor as the shrinking jungle.

The trading floor is an awesome place, but it's shrinking. Regulations are putting a cap on how much risk many desks can take. The risk appetite for many products is gone. Prop desks have gone on the sell-side, and have been replaced by small directional bets within flow trader books. I think the people I've met, and am friends with because of my time on the trading floor, are some of the coolest people - the personalities, the passion, the angry yet festive nature of most comments. However, I wouldn't want to go back.

Because of this, fewer spots are available. While the number of students looking to get into S&T is only slightly decreasing, senior traders remain in the same position as there are fewer openings at other firms. Beyond regulations crushing trading desks, technology is adding a major strain.

Yet, trading will never cease to exist as many tend to believe. The above isn't to scare you away from trading, simply to warn you of the fact that the industry is changing, and with those changes, headcount is decreasing. Securing a job in S&T is becoming increasingly competitive, so if it's something that you want to do, you better go all out if you want a chance at securing a job. Here's @Kassad on why the sentiment that trading will be eliminated entirely is incorrect.

Okay, to think that any of these businesses will be "gone" any time soon is to lack an understanding of what they fundamentally are/do.

All of these businesses will change and continue to change for as long as capital markets exist: M&A will always be necessary in some form, the S&T function will be a necessary tool for moving capital, Research will be a necessity to transmit information from originators to clients, and all the other core functions of a bank will continue to fulfill their purpose as required. All of the roles will change with the coming of new technology, laws, and industry standards, but they will not "disappear."

S&T vs Investment Banking - Salary, Lifestyle, Role, and More

People love comparing S&T to investment banking - they're both highly prestigious jobs that pay great. But they don't come without their differences, so if you're considering a career in either of these fields, then you need to consider what separates the two.

Salary

Compensation in S&T is roughly comparable, if slightly less, than the compensation in IB. At the analyst level, you can expect to make around $120k first year. As you move up, that figure increases significantly. Managing directors in each field make around $700k - $1m. That said, IB all-in compensation tends to be a tad higher than S&T, and that difference grows a little as you move up the ladder. The top performers in S&T certainly make more than IB, but those top performers are becoming rarer and rarer, more on that later. In both fields, bonus makes up the majority of your all-in compensation by the time you're a vice president.

Role

Investment bankers, at least at the analyst level, are known for being mostly grunts. The type of work analysts do is almost entirely mundane. Sure, there's some exciting work dabbled in there. Executing that mega deal you've been working on for months is exhilarating, and there's no doubt that it's a time of immeasurable learning. Beyond that, camaraderie tends to develop with your team considering you spend 80 hours a week with them, and those are bonds not easily broken. But, by and large, IB is a grind at the beginning, and anyone who refuses to acknowledge that at the start is lost.

The work S&T analysts do is highly variable once they reach a certain point, but at the beginning, it's comparable to IB (the key difference being the fewer hours). For first and second year analysts, it's a lot of the same stuff. Similar to investment banking, the work of S&T analysts is mostly grunt work. Here's @Gekko21 on what that includes:

Learning the product, sending out reports, conducting research, making spreadsheets for the desk, answering phones, and sending out early morning offer sheets are all things you will be doing for the first year or so.

The difference is that after a period of time - anywhere from 3 months to a couple of years, depending on your performance - you get significant responsibility, and your role changes.

On the sales side of things, once you start dealing with clients, you'll spend far less time in the office and far more time building relationships with clients and negotiating with them. So the question remains: how do you go about securing clients? It's not an easy process due to the shrinkage of the industry. You're all competing for limited clientele. Here's @Disjoint on the dynamic clients create within the sales group.

MDs and Ds were seeing their clients die by the day; they would hold on to whatever they could. If you were a junior and hoping to survive, you had to have an extremely strong back to break off all the blades that were smashed on you. You had to go and find your clients, make alliances with some salespeople, and fight. Fight. Fight every single day. You had to learn how to go after accounts, and sometimes nick accounts yourself from weak salespeople - and it will be good, and you will learn to like it. Now sometimes you are lucky, and someone will take you under his protective wings. Just don't expect it; business is dying by the day. And the last thing we need is another salesperson on the desk to compete with. You will learn that salespeople are all for me, and all for me again.

On the trading side, the work greatly depends on one factor: getting your own book. Some people get their book within three months; some get their own book after a couple of years. It all depends on how much responsibility you shoulder, how capable you are, and how well you're received.

Hours and Lifestyle

Everyone knows IB hours are brutal, typically 80+ hours a week. How does S&T compare? S&T analysts typically put in around 60 hours during the week, with some weekend work depending on how motivated you are. Once you start working with clients in sales or get your own book in trading, your hours and lifestyle are determined by you. Generally, it's around the typical 60 hour week with no weekend work. Of course, the less you put in, the less you'll likely get out. With fewer hours comes (in most cases due to relatively weaker performance) a lower compensation.

How to Start Trading

If you actually do all these steps, you will be a better trader and know more about markets than most kids do AFTER they complete an analyst or associate stint on a sales and trading desk... I guarantee it.

How do basketball players get better? Practice. How do investors get better? Practice. If you want to pursue a career in trading, start trading. If you do so sometime in college, you'll be putting yourself in an excellent spot for S&T recruiting (assuming you're on course in terms of GPA, internships, and school). You'll impress in interviews, and you'll probably get your own book much quicker than your peers if you apply the knowledge you've developed. So what exactly is the right way to go about trading? Here's @Revsly with a chronological set of things you should do to start trading.

Before you get into that, you're going to want at least $5k to trade with. Set up an account on Interactive Brokers that allows you to trade futures. Then pick your product. That product needs to have a small-sized contract. @Revsly used Hang Seng Index Futures.

Read up on the leverage inherent in futures, and create a risk management plan, i.e., how you are going to size trades, use stops, add to positions, etc. Notice you do this before you know anything about the market because it is, by far, the most important part of being a good trader. Discipline is what is going to make you a good trader, not brilliant ideas. On 5k, you will probably be trading 1 lots, i.e., 1 contract. That is fine.

Learn how to account for your performance. Every day you should know how much you made or lost and have a good log of it. Not what the broker sends you. You should do it yourself and use them as a check. You are your own back-office and middle-office.

Learn the interactive broker's execution platform inside and out. The IB platform is not much different then one I use at a large hedge fund, so when you're done with this, you should be able to execute in a professional manner.

Up to this point, you've just spent your time learning and preparing to start trading. You're sharpening the ax before you start swinging. Now you're going to learn everything about the market you're trading in. Political climate, economics (think regulations, etc.), composition of the stock index, and pretty much anything that could be of value to you during your trading. Then you start trading with preservation of capital standing as the most integral principle. You don't think, "How much could I make off this trade?" You think, "How much could I lose off this trade?"

Getting into S&T

If you're looking to get into S&T, there are two things you should do, in particular, to prepare (outside of preparing for interviews and such): reading and trading. See "getting into trading" below for a guide on getting into trading. It's something that you should definitely look to do if you have an interest in trading, and it will give you a massive edge come recruiting. Reading to prepare is another beast. It's something you should do to expand your breadth of knowledge as much as possible. Here's a list of books you should read before you hit the desk (if you have to prioritize one, we recommend Market Wizards) from @Ironchef.

All junior traders on my desk were told to read the following:

1) When Genius Failed
2) Fooled by Randomness
3) Reminiscences of a Stock Operator
4) Trading in the Zone
5) Market Wizards (all 3-4 books)
6) Liar's Poker
7) Steidlmayer on Markets: Trading with Market Profile
8) Technical Analysis of the Financial Markets by John Murphy

Agency Trading

Agency trading is fairly simple to understand: it's all about executing the trades of your clients. Thus, the only way agency trading makes money is through commissions. Agency traders do not have their own books, so they don't have market risk. Their sole purpose is to execute trades at the behest of their clients. Here are some retail examples of agency trading from @Boothorbust.

Macy's is like a principal dealer, maintaining an inventory of goods to sell to customers. They carry the risk of the goods depreciating because they own them until they are sold. To compensate for this risk and make money, they charge more for the goods than the price they paid for them (the spread).

eBay is an agency trader, facilitating trades between members of the market, carrying no inventory, and making money only on commissions, charged as a percentage of each sale.

Original Thread - Difference Between Sales and Sales Trading

What is the difference between Sales and Sales Trading? I know what Sales and Trading is, but I don't understand the difference between the roles called sales and sales trading. Does sales only speak to the client to get the best market prices or does sales trading do that? Can't tell the difference from this description:

Sales
As a sales person, you're the link between our researchers, traders and the client. Building great relationships with clients is essential, because you're there to provide analysis, insight and solutions to their needs. Some of these issues are hugely complex and you'll be required to provide up-to-date market information at the drop of a hat.

Your day starts early as your first task will be to review overnight market activity and form your own independent views. Then you're on the phone, calling clients to give them fresh ideas and news, which they cannot get from our competitors. You'll also be working proactively to get the best market prices for your clients, so they trust and value your advice.

As you can guess, you'll be treading a very fine line. Naturally, you're representing J.P. , but on the other hand, you're representing the clients' interests and building long-term relationships. So tact and diplomacy are pretty critical, as well as a good sense of humor.

Sales trading

This differs from the classic sales role, in that sales traders speak directly to the dealing desks of our clients, who range from institutional investors to hedge funds.

As a sales trader, you'll liaise with these dealing desks and traders to facilitate client business either via block, single, electronic, or program trading. You'll give the best description of the flows and themes occurring within the marketplace, and you'll need to ensure that clients are aware of any news flow that may be relevant to their business, so they are in the best position to make decisions.

As clients are getting more sophisticated, so are our sales traders. We are looking at more asset classes with the aim of generating better returns for our clients as well as J.P. Morgan.

Comments (53)

12/13/09

Hey I'm not really sure, but here is my 2 cents worth

I think the Sales team will pitch to clients, build relationships and generally sell the bank ideas to clients. So these ideas could come from the researchers (since researchers dont really do the selling). During all these while, you are constantly busy building relationships and selling your ideas, so you dont really have much time to interact with traders.

Your clients may want to find out more info (like getting in/out at what prices etc) and so it gets tricky when most of your clients want to trade with you. Traders (flow traders not prop) themselves are busy trying to earn spreads and taking the orders.

So this is where sales trading comes into place. Sales traders are very close to the market. They dont visit clients and are thus desk bound. They know the trend of the market and the products very well (Sales people will be busy with their own pitchings and relationship buildings). They will interact with your clients to inform them at which price they should enter and at which price they should exit. If clients want to execute, Sales traders will inform the traders the same thing as well. Sales traders are very informed of the market. From what I know, there are times sales traders may execute the trades as well.

So to put it short, sales traders ensure the flow of information and trade requests goes smoothly. Hope that helps BUT i might be wrong alright.

Investment Banking Interview Course
12/13/09

^Mostly correct

Equity sales (also known as research sales): Primary responsibility is to pitch equity research reports and notes to clients. As analyst, that is all you will be doing. When you move up to associate and beyond, you will be able to interject your opinion to a certain extent. This job is essentially all about relationships. If you are not the type of person who has a ton of friends and can walk into a room and immediately strike up a conversation with anyone, you are not going to do well in equity sales. Exit opps: investor relations at a company that you have covered or at a buyside firm

Equity sales trader: A trader/pm on the buyside gives you buy and sell orders. You then tell the sellside trader on your floor the order and the way that the clients wants it traded (VWAP, TWAP, or worked). It is then your job to stay on the trader's ass to ensure that the trader is trading it properly. You also discuss the reasons for the daily movements in specific stocks in contrast to equity salesmen who are more concerned with longer term catalysts. The job also requires social adeptness and you will be taking out clients at least twice a week.

12/14/09
Grover Cleveland:

^Mostly correct

Equity sales (also known as research sales): Primary responsibility is to pitch equity research reports and notes to clients. As analyst, that is all you will be doing. When you move up to associate and beyond, you will be able to interject your opinion to a certain extent. This job is essentially all about relationships. If you are not the type of person who has a ton of friends and can walk into a room and immediately strike up a conversation with anyone, you are not going to do well in equity sales. Exit opps: investor relations at a company that you have covered or at a buyside firm

Equity sales trader: A trader/pm on the buyside gives you buy and sell orders. You then tell the sellside trader on your floor the order and the way that the clients wants it traded (VWAP, TWAP, or worked). It is then your job to stay on the trader's ass to ensure that the trader is trading it properly. You also discuss the reasons for the daily movements in specific stocks in contrast to equity salesmen who are more concerned with longer term catalysts. The job also requires social adeptness and you will be taking out clients at least twice a week.

when does the broker come into picture?? does the sellside trader call the broker to execute trades for him??

12/14/09

"About our Business"

ECM and DCM are capital markets groups, they pitch ideas to corporations relating to the issuance of equity (E in ECM) and debt (D in DCM). The ideas relate often to optimizing capital structure, de-levering/levered recap, advantageous refinancing due to spreads/term structure etc
plainly they are bankers focusing on origination of new securities.

if someone is in "ABS" he could be a banker structuring large deals, selling abs, or trading abs, or managing an ABS portfolio (buyside asset management) or researching abs (strategy)

12/14/09

from wetfeet

Securities Sales and Trading
OVERVIEW
Securities sales and trading is where the rubber meets the road in the investment banking industry. An investment bank relies on its sales department to sell bonds or shares of stock in companies it underwrites. Investors who want to buy or sell a certain stock or bond will place an order with a broker or sales representative, who writes the ticket for the order. The trader makes the trade.

What You'll Do
Securities sales and trading are high-profile, high-pressure roles in the investment banking industry. Unlike other I-banking careers, such as corporate finance, public finance, and M&A, where the emphasis is on the team, securities salespeople and traders are independent, working on commission to bring to market the financial products that others create.

In the United States, the securities business revolves around markets (also known as "exchanges") such as the New York Stock Exchange, the Chicago Board of Trade, and NASDAQ, where debt, futures, options, stocks, and other financial instruments are bought and sold. Salespeople and traders are independent agents working under a simple contract: The firm provides a place to do business in return for a percentage of the business that salespeople and traders generate.

Salespeople are called brokers or dealers. As one of them, you're expected to build a "book" of clients. No matter how long you've been working, and no matter how many clients you have, you're expected to cold call. New brokers make as many as 600 cold calls a day. Most of the work takes place over the telephone: soliciting clients or selling a particular stock or bond issue. You'll use analyst research and every sales trick in the book to push your securities to investors.

Traders make money by trading securities. Although they're the ones who transact trades for the brokers and their clients, traders are primarily responsible for taking a position in a security issue and buying or selling large amounts of stocks or bonds using an employer's (or their own) capital. When they bet right, they win big; when they bet wrong, they lose big.

Brokers and traders build their lives around market hours. On the West Coast, you'll start working before 6:00 a.m., so that you're ready to go when the opening bell rings. There's no flextime, no long coffee breaks, and no time to run errands.

Who Does Well
Securities sales and trading is a high-pressure career. You're responsible for the financial fortunes of your clients--or yourself, if you're a lone trader. Every day you're making $100,000 (or more) decisions under severe time constraints. The daily fluctuations of stock prices can make you rich one day and break you the next. Brokers eat a lot of antacid.

Securities salespeople and traders work independently, usually with little supervision and very little interaction with management--provided they succeed. If they don't, they're quickly out of a job. To do well, you need a good head for numbers and a hidebound determination to make money.

If you're on the sales side, you'll need exceptional customer service skills; if you're a trader, you'll need to be able to handle huge risk--and stomach huge losses. The upside of these careers is the money brokers can make. Successful salespeople and traders can get very rich.

12/14/09

"Client" Trading is flow trading.
Fixed Income and Equities are divisions regrouping all the desk dealing with that asset class. On each desk, there are people with different roles: sales, traders...

12/14/09

can anyone explain what flow trading, or specifically, what a person in flow sales team of a bank do??

12/14/09

a person in flow sales is in constant communication with buyside ppl all day. They provide mkt color and trade details to hedge funds, mutual funds, prop shops (the big ones). It is there job to relay bid/asks and volume to clients given to them from the traders and at the same time try to make everyone happy with the trade. The more trades printed the more commission a sales guy makes for the team. They are the liaison btw the traders and the buyside firms. An example of an interaction might be this...

-HF trader asks salesman, "Hey John, where can I buy X amount of XYZ?"
-Sales guy says let me see and then asks traders for a market.
-Sales guy comes back and tells buyside what trader says
-The trade either gets done, or there is further negotiation...

**They are basically doing the talking for the traders b/c traders don't have time to talk to each client.

12/14/09

ohhh, thanks for the explanation!!
so instead of wokring on a specific product (like commodities, equities etc), they work with any products but with buyside clients?

12/14/09

Usually they work on a specific product. For example, "commodities" is not specific at all. Natural gas would be specific. Base metals would be specific.

12/14/09

so.. under flow sales team, you have different people working on different products/categories, but all deals with buyside client?

12/14/09

Clients are usually specific to your desk. A rates salesman might sell to global macro hedge funds whereas a cash equity salesman will sell to long/short hedge funds. Typically, you work more with your desk (traders, structurers, research..) than with the rest of sales who have their own desk to worry about.

12/14/09

okay. so back to my original question... what/who does a sales person in the flow sales team work with???

12/14/09

???

The who: If you are on a rates sales desk you work with other rates sales people and rates flow traders. If you are on an fx sales desk, you work with other fx sales people and fx flow traders (as well as perhaps structuring on occasion).

The what: You use one or two phones and a computer. The product you deal with is typically pretty obvious from the name of your team (rates sales, fx sales, etc).

12/14/09

so all traders do is buy and sell assets? I'm assuming everything is done on the computer?

12/14/09

A flow trader looks for the most advantageous bid-ask spreads to place client orders. And yeah, you'll have a few screens instead of a runner.

Investment Banking Interview Course
12/14/09

Pay is good. Basically when people will say they work sales and trading they are either on a trading desk trading the firms capital for a gain or on the sales side. These are the traders we traditionally think of.

The sales guys that put the "sales" in "sales and trading". These guys find companies that need capital and then sell the companies' stock/bonds to their clients (hedge funds, pensions, endowments). These guys especially at the MD level are client facing, frequently at dinners/traveling.

Pay is great and work isn't bad. Basically you work reasonable hours and just ball out. I'd say hit it up. They sit on the trading floor w/ prop desks although I think this is a conflict of interests. I think they might just segregate the floor.

12/14/09

lol yeah right

12/14/09

Prop trading generally occurs in "bubbles." Sales sits right next to/across from the traders (ie flow/sell-side traders) at BBs.

Jack: They're all former investment bankers who were laid off from that economic crisis that Nancy Pelosi caused. They have zero real world skills, but God they work hard.
-30 Rock

12/14/09

WTF BCBanker... You obviously don't know what you're giving "advice" on if you follow it up with a question like "Do they sit with prop traders?" Your post is also just plain incoherent.

Salespeople have a client base (institutional investors) and are constantly pitching them investment ideas and also trying to move shit the traders don't want on their books. Frequently they'll just be conduits for trades (client calls salesperson, salesperson yells to trader, trader quotes price). They're also the relationship contact of that client to the firm's trading ops, so a lot of the job is wining and dining -- pretty much everyone can do the job the same, so you have to make your client like you more than anyone else.

Skills necessary? Lots of soft skills. Obviously be good with people, be a good bullshitter (in both the "shoot the shit" sense as well as the poker face sense), be calm under pressure, be able to prioritize, etc...also depends on the product you sell. Exotics salesmen, or rate derivatives salesmen, will need a better grasp of math and finance than gov't and agency salespeople.

Average day is something like 6-7am to 4-5pm. Can't comment on pay, but figure it can't be too shabby.

12/14/09

That was very helpful, I appreciate it. What do you think it takes to break into this type of Sales? I was on a sales floor at a Mutual Fund company. They mostly sold to brokers and high net worth individuals, so I'm assuming working in Institutional Sales is a lot different. What do you think it takes to break into this field? Also, do these positions exist outside of just BB firms?

12/14/09

i agree, boston college is totally shit and BC banker is a retard from his past posts

12/14/09

Also, if someone says they're a "Sales Trader", that means they're in sales, not in trading. The closest any self-respecting trader would say is that they trade on the SS.

12/14/09

You make it sound as if being in this type of Sales department is something undesirable/not respectful?

12/14/09
monkay:

You make it sound as if being in this type of Sales department is something undesirable/not respectful?

Historically there has been this perception that Salesmen are lesser people than Traders, partly because of the infamous ego of traders. Now a days a lot of traders are being converted into salesmen as well as traders (sell side).

Watch the movie Wall Street, what Charlie Sheen does is Sales. He cold calls people that have done business with his firm before and pitches moves to them, in the case of BB with prop desks this is generally seen as pretty shady as was mentioned in a previous post, as sometimes they are pitching moves that will help the companies prop desks rather than the clients portoflio (or in some times both).

Salesmen made a shit ton of money in the 80's when everyone on the buy side was seen to be some kind of 'idiot.' Places like solamon manipulated the shit out of buy siders, namely in the MBS arena, and made killer profit on commision.

^ That kind of lunacy is why places like Solamon made a ton of money and why the MBS sector was a disaster waiting to happen.

What's intriguing about sales is that it is increasingly more difficult now that the market did what it did, and that we have a regime in Washington that paints Wall Street as the EMpire from Star Wars poaching the innocent. It's not the hay day of trading anymore; Sales men have to be GOOOOOODDD to make money, and being a good BSer doesn't pay off like it used to.

Buy Siders are getting smarter at spotting bull shit, it's not the 80's anymore. You have to know your pitch, inside and out, in order to be successful in sales in the Euro/American markets.

BC kid was wrong, salesmen in S&T are not like salesmen at other companies. They rarely golf with clients or host dinners; that's what HF sales teams do to get you to drop 1MM in their fund. Salesmen in S&T call you when the market is open and try and get you to buy some security or instrument so that their company can make money on commission, and hopefully that their client's portfolio can get padded so they will keep coming back for more pitches, creating a never ending cycle of cash flow (hopefully).

12/14/09

Ha. What is it about BC kids that make them "naturally retarded" and the school "totally shit"? Clearly not at the top of the academic tables but overall its solid and I enjoyed my time there.

It attracts kids who actually got laid in high school and are well-rounded unlike plenty of members on the board.

12/14/09
junkbondswap:

Ha. What is it about BC kids that make them "naturally retarded" and the school "totally shit"? Clearly not at the top of the academic tables but overall its solid and I enjoyed my time there.

It attracts kids who actually got laid in high school and are well-rounded unlike plenty of members on the board.

Serious inadequacy issues....

If I ever meet a chick from BC there is no way I tell her I went to an Ivy, if you find yourself in this situation I've had a lot more success mentioning that I attended a URI or SUNY Albany type school

Good talk, See you out there

12/14/09

Emerging Alpha,

You're a clown with no sense of humor, exactly the type of guy I described above. You would probably do well in a sales role as you are likely familiar with S'ing a lot of D.

12/14/09
Emerging Alpha:
junkbondswap:

Ha. What is it about BC kids that make them "naturally retarded" and the school "totally shit"? Clearly not at the top of the academic tables but overall its solid and I enjoyed my time there.

It attracts kids who actually got laid in high school and are well-rounded unlike plenty of members on the board.

Serious inadequacy issues....

If I ever meet a chick from BC there is no way I tell her I went to an Ivy, if you find yourself in this situation I've had a lot more success mentioning that I attended a URI or SUNY Albany type school

Good talk, See you out there

I know a number of smart folks from Boston College; a number of them work in Sales & Trading.

There's smart and dumb people everywhere. Smart folks at the Ivies. Smart folks at Boston College. Smart folks at State Schools. Smart folks at community colleges. One of the best ways to identify a DUMB Ivy Leaguer, however, is the fact that he judges people by their pedigree rather than their recent work. Most of these people are insecure about their success in industry.

To answer the question, sales guys typically sit across from the traders and help represent clients on their trades. They're on the phone with the client quoting bids and asks to them that they're getting from the trader. The trader pays them a commission for the sale, and the transaction is concluded. Sometimes, traders will need to build or get out of positions and the sales guys will help out by calling up existing clients to ask if they'd be interested in buying or selling at a more advantageous price than usual. Sometimes, they get into disagreements with traders; if you HATE drama, you may not want to work in client flow trading.

I don't work directly with the sales guys, but I haven't seen a lot (besides the fact that there seems to be a lot less debauchery) that specifically contradicts what you'll find in Liar's Poker in terms of what happens on a daily basis on the floor.

12/14/09
IlliniProgrammer:

I don't work directly with the sales guys, but I haven't seen a lot (besides the fact that there seems to be a lot less debauchery) that specifically contradicts what you'll find in Liar's Poker in terms of what happens on a daily basis on the floor.

What do you mean about this last bit?

12/14/09
m.c.trader:
IlliniProgrammer:

I don't work directly with the sales guys, but I haven't seen a lot (besides the fact that there seems to be a lot less debauchery) that specifically contradicts what you'll find in Liar's Poker in terms of what happens on a daily basis on the floor.

What do you mean about this last bit?

-Lunches with clients (less drinking than Lewis described).
-Sales guys and Traders arguing over what just happened on a trade.
-Traders trying to sell sales guys on different trades. (Fewer traders screwing clients and their sales guys to get out of a bad position).

12/14/09

this thread isn't for information about BC

12/14/09

lol wow a lot of BC hate out there. we rep on the street and business school is now in top 10 rankings.

12/14/09

What you need to show:

  • Sales skills: very personable and able to shoot the shit friendly; you should be able to talk at length about all things other than finance and markets, you should be able to establish a rapport, be able to relate to your clients (interviewers in this case) and be able for them to relate to
  • Knowledge and passion for the markets: you should be very knowledgeable about the markets and at the very least have a solid understanding about the product group in which you're interview
  • Be able to sell: they will WITHOUT EXCEPTION tell you to sell them something, ask you to make them a market for X

Its sales salesman... your job is to show that clients will like you, you know your shit, and more than anything else that you can sell.

Bottom line: know your client, know your shit and be able to sell.

12/14/09

Can anyone quote a salary figure? and average bonus figures?

12/14/09

Same as traders/IBD at analyst level. As you develop your rolodex (associate level and beyond), bonuses are tied to how many commissions (on trades) you generate. Typically the bigger the spreads on the product, the higher the comp. Back in 07, exotic credit salesmen (which involves structuring deals) in London were making 300k usd base and 4 mil usd bonuses at the MD level on average. That's the highest it's probably gotten in recent memory. For the majority of products and market conditions, big hitters probably pull down 1 to 2 mil in bonuses, and have standard base salaries. Expense accounts are usually generous when it comes to client entertaining.

12/14/09

Sounds like GoodBread might know what he's talking about. I don't have first-hand information about sales guys salaries and firm policy prevents me from even throwing out a guess, but I'll say that if you go into sales because you're pretty sure you'll enjoy selling stuff, you're not going to be looking at somebody else's pay in five years and say, "Oops. I made a mistake. Should have gone into XXXX". You'll say, "Yes, he earns a little more than me, but he's aged ten years in the past five, so I got a better deal than him." I can't say quite the same thing about trading, risk management, analytics, or investment banking- actually, the only other area I can say this about is quantitative strategies/research, and that usually takes a PhD.

Client Trading Sales is the pinnacle of sales as a profession. You can't make anywhere near as much money elsewhere in sales (besides maybe consulting). My mom, who works in Pharmaceutical sales, would probably be able to retire if she were able to save up what these guys earn in a year.

12/14/09

Those figures were from Napier Scott, a headhunter in London, which the FT used as their basis for articles on S&T compensation during the boom years. The results of these surveys aren't public anymore, probably to avoid from drawing light to how much people in S&T can make.

12/14/09

vp - d level at bb makes 400-700

12/14/09

"vp - d level at bb makes 400-700"

this is about right for vp's, it's low for directors.

12/14/09

actually the Director number is equivalent to VP depending on the bank.
at MS for example, we use the title "Director/Executive Director" which is equivalent to being a VP.

12/14/09

"actually the Director number is equivalent to VP depending on the bank.
at MS for example, we use the title "Director/Executive Director" which is equivalent to being a VP."

ok, at most other shops director/principal is the level above vp and below md.

12/14/09

I appreciated finding this thread as someone who is leaning towards sales-trading. Any more comp numbers would be great at all levels and desk specific if that is available. Thanks.

12/14/09

Use the fucking site.

Under my tutelage, you will grow from boys to men. From men into gladiators. And from gladiators into SWANSONS.

12/14/09

^ouch

12/14/09

Welcome to the site, jcsiv. For really basic questions such as this people will often tell you to search for pre-existing threads - and this is good advice. There's a general FAQ section that has a good overview of sales versus trading.

Sales: //www.wallstreetoasis.com/what-is-sales

Trading: //www.wallstreetoasis.com/trading-overview

Essentially, the focus of someone in sales is on interacting with clients by way of offering trade advice/ideas. Traders are the ones who will create prices for complex products such as derivatives, and actually execute the orders that clients place.

12/14/09

go download vault guide - sales and trading. they have very good and detail explanation.

12/14/09

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12/14/09

The number of day traders on the Forbes Rich List is...zero

11/6/17
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