Trading still a good career?
Hey guys,
I am an undergraduate junior. I had an investment banking internship last summer, and am still really not convinced one on direction in finance, though I do know that finance is what I am good at.
My only problem is that I really am not interested in what IB is, and am not 100% set on any of the designated exit opps either. I really am interested in what trading is, though. I am also interested in consulting and the career and what that has to offer.
My question is:
- Is trading still a job/career that can lead to good exit opportunities, career transitions, if necessary?
- Is it still a career that can lead to people making lots of money?
Any other comments would be helpful and much appreciated.
OP continued at bottom
Sales and Trading vs Investment Banking vs Consulting?
There are lots of considerations that go into choosing a career path. Fit, skills, interests, salary, bonus, professional growth, exit opps, etc. As a college student, it can be hard to decide because what you know about different careers comes from what you read on forums and, maybe, internships.
For example, a common refrain about trading is that it’s a dying industry, everything is going the way of automation, there’s no opportunity left. Parts of these statements are correct, but the reality is a little less extreme. A few of WSO’s seasoned hedge fund and trading professionals shared their insights on OP’s dilemma.
From Certified Hedge Fund Professional – Quant @jargon223"
Trading can still be ok, and there are still "exit opportunities" regardless of what people say - although they may not be as broad or in all the areas you would like to have. I guess it all depends on where you want to "exit" to.
If you like trading more than anything else then do it. But if you have an interest in IB/consulting/whatever, maybe it's worth it to give all those a good look, too. The "no, do this" or "yes, do that" answer you're looking for is hard to give.
From Certified Sales and Trading Professional @Working9-5"
Exit opps are what you make them. Take a field trip and try experience a day with Cantor Fitzgerald and any other BB (this is equities.) You'll experience a ton more and see how different culture could be a deciding factor.
From Certified Sales and Trading Professional @derivstrading"
I would never do a job for its exit opps. I would do a job because I liked doing that job and wanted to get better and progress in it. People in IB only focus on exit opps because IBD is such absolute sh1t. You go into trading because you want to be better at trading.
Recommended Reading
- Trader’s Job Security and Long-term Career Path
- Is it Worth Pursuing a Career in Trading in 2017?
- Picking the Right Trading Jungle
- Exit Opps for Commodity Trading (Oil/Gas/Power)
- Exit Opps from Top Prop Firms/Market Makers
Continuation of OP:
I have spoken to a lot of people in the industry, and when talking in terms of exit opportunities, IB is the clear winner, with trading not really being a good stepping stone to any careers I'm interested in, sorry if I have offended any execution traders out there ;).
…
I would be a sell out if I just chose the IB path because that's the safest in terms of guaranteed jobs and money, to a degree, of course.
@"ArcherVice" @"Working9-5" @"SirTradesaLot" can comment better than I can. all I can say is that you should prepare to get flamed for starting a topic that's discussed to death
TRUTH
Check this out:
http://www.wallstreetoasis.com/blog/picking-the-right-trading-jungle
'Finance' is what you're good at? Care to be more specific?
Trading can still be ok, and there are still "exit opportunities" regardless of what people say - although they may not be as broad or in all the areas you would like to have. I guess it all depends on where you want to "exit" to.
Lots of guys have lost their edge and there's been a big shift in the trading world. Years ago, you could go to most any group and learn and make money. Now it's harder to find the right groups and get the right seats. I know of many people who've left or are leaving completely, but again, there are people out there making money, it just can be tricky to find them.
If you like trading more than anything else then do it. But if you have an interest in IB/consulting/whatever, maybe it's worth it to give all those a good look, too. The "no, do this" or "yes, do that" answer you're looking for is hard to give.
Exit opps are what you make them. You'll need to be more specific for me to give more advice outside of the generic.
Take a field trip and try experience a day with Cantor Fitzgerald, JonesTrading and any other BB (this is equities.) You'll experience a ton more and see how different culture could be a deciding factor.
I'd switch JonesTrading for Redburn Partners if you're in London.
Use the search bar man. You need to figure out what you want to do, what interests you and which is going to play to your strengths. What kind of answer are you looking for? I know a guy making minimum deep six figures if not millions per year trading oil in London. I'm friends with a partner at EY and he brings home amazing money too. I'm sure there are i-bankers, hedgies, consultants (partners?) and PE guys making as much, and the percentages that make it to those income levels are probably the same. Not many. The key is finding whichever one of those fields plays to your strengths so you can be the most successful.
I'll give you my take although I'm still a senior and have just recently accepted a role in sell-side trading.
Will you still be able to make a lot of money? Yes, at least in the near term, although this depends quite a bit on what desk you're on. My guess is that it's becoming more and more difficult for cash equities traders to generate huge PnL and the role is becoming more relationship based. On the other hand, there are still extremely bespoke products that require you to take on large amounts of risks because they are difficult to hedge and there is low liquidity. If your clients are rewarding you fairly for the risk you're taking on, and you are hedging in such a way that you take a prop view and generate PnL on that as well then I could see how certain areas could be extremely profitable. There are also so many desks in between, S&T is a ton of different products and within each product a spectrum.
Will trading still be relevant? Also very desk dependent. It seems that the extremely high volume stuff is pretty likely to be automated in the near future. FX and rates seem like they're already going the way of equities. On the other hand, some products (as mentioned above) are extremely complex and difficult to automate because of liquidity issues and the number of factors at play.
Exit Opps: This is the part that worries me most. My hope is that being at a very prestigious BB will afford me the ability to get into a top MBA later on if I so choose. Otherwise I believe most traders just end up going to hedge funds or moving around in their bank or other banks. But there are a lot of sell-side desks that give you a good chance of getting into a HF depending on what you want to do. If you're interested in Global Macro your experience in rates of FX can really help you there. If you're looking to work at a fund that specializes in mortgages/securitized products than being in a structured products group teaches you a TON about that product (Structured products are basically their own little world, the world of prepayments).
This was a big of a rant and is basically me throwing together a lot of stuff I've read on this site from other users but it may be helpful.
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