What do newly joined trading graduates do?
After reading these forums I have a basic understanding of what a full time trader does, but what does a graduate do? Obviously they don't start generating profit and loss, so do they just sit around and watch and learn for the first 6 months?
I was asked this question in a phone interview and bs'ed my way through it and at the end she said ok, make sure you learn what a new graduate does if you get invited for a face to face interview which I have been.
Thanks guys.
Will report back with interview questions if people help.
Apart from that, you watch the traders and do all the BO and administrative work for the desk. Send out reports, monitor risk, answer phones, get lunch. Overall it is very much like a Summer internship, except you gain more and more responsibility over time because it is expected that you will start trading.
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In addition to all the things mentioned above:
Getting food - basically your main responsibility as a grad
Timeframe to getting a book is heavily dependent on what you are trading. Cash equities i have seen in 2 months, index options I have seen in about 10 months, while more heavy products can be longer. You will probably be slowed in to the process. Ie on an options desk you will start having a position in a future at all times, then do a gamma trade, then do a skew trade and slowly build up.
the intern/graduate who hesitate to grab coffee/lunch/snack by displaying an attitude of "why the hell do I need to do this? I'm a trader here" will be lowly regarded and disliked and your lifespan will be short. When I started, I had huge sense of enthusasm to grab them for the desk (not as a 'duty' but i did enjoy it)... mind you the coffee ritual is the time you get to have personal conversation, that's how you slowly fit into the desk.
In all honestly, if the interviewer asks what you are planning to do as graduate, if he/she can answer "I'm here to grab your coffee and lunch" I will know this kid knows what he/she is putting against and like the candidate. It's also a nice ice-breaker.... if the kid comes to me and say 'i'm here to make millions for the bank' I will ask them real technical tough question and embarass him.
we hate arrogance. just remember that.... unless of course you make 20bucks, being a complete jack arse will be tolerated.
Great comments, much appreciated.
Interview coming up monday.
To complement everything above, just make sure you convey your initiative (i.e. being able to proactively find ways to add value to the desk, without being told what to do all the time) and humbleness (i.e. seeing the grunt work as a value-added part of the business because...).
Best of luck, buddy.
After the 12-24 month period, does the head trader essentially give up his worst clients for you to manage. Don't really see how Entry Level Sales & Trading employees pull in huge bonuses if they don't contribute to P/L and at best they get low revenue clientele.
Also, I recently interviewed at a boutique fixed income sales & trading firm (mostly vanilla bonds, convertibles but no inventory). As part of the process, I sat on the trading floor behind a TA. He had told me that he spent 2 years at a BB as a Sales assistant but during that hour or so, he was filling out and stampings order tickets. Does that sound right to you guys - or is that more of the function of it being a boutique firm?
Traders don't have clients, what do you mean? You do whatever the desk needs you to do, run risk, book trades, deal with all the admin stuff, hedge, etc. During this time, you try to learn as much as you can, you learn pricing, and eventually price things with traders, then on your own. They'll generally start you out with lower risk trades, its all pretty common sense really.
Depending on the product and individual desk, junior traders are often given a very small prop book of their own where they simply punt around the market to develop their skill-set. On an FX Options Desk, the junior trader's book is usually given the limit of a $1 MM delta.
Maybe at some banks, but the one's I've seen everyone trades the same book.
During the first few years, it doesn't sound like a junior trader could really contribute to P/L. Regarding my second statement..
"Also, I recently interviewed at a boutique fixed income sales & trading firm (mostly vanilla bonds, convertibles but no inventory). As part of the process, I sat on the trading floor behind a TA. He had told me that he spent 2 years at a BB as a Sales assistant but during that hour or so, he was filling out and stampings order tickets. Does that sound right to you guys - or is that more of the function of it being a boutique firm?"
How unusual is this scenario?
...
Sounds right. For the most part, same type of stuff if you're the junior on an FX or Equity (Cash & Derivatives) Desk. Just different EMSs and OMSs for different asset classes.
With the Volcker Rule in place, it seems like punting around the market or managing a small prop book will not adequately train new traders who will need to interface with clients in order to make trades. That said do you guys think entry level traders would get more exposure talking to market participants and taking client orders?
That's not exactly how it works, of course you are running through pricing and market making. Usually you'll start out with smaller trades or ones which have less risk and price up more complicated/bigger one's with more experienced traders who can show you the ropes. Don't forget though that having a market sense is crucial for market making, its how you read clients and can extract the most value. For example, in exotics, choosing what/where to overhedge and position yourself or what correlation trade the client is likely trying to do can make a huge difference in PNL.
Don't get too hung up on the Volcker Rule thing, seriously.
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