What do you do?
Completely serious when I ask this: What do you actually do in S&T? I work in IB at a BB and talking to my buddies in S&T it always sounds like such an interesting job. Way more complexity than the BS we do in IB... but I just genuinely don't understand what the day-to-day of the job is? Like if someone asked me what do you actually do in IB, I'd say I spend a bunch of time putting together materials to send to clients, like models in Excel and PPT outputs, with the general goal being to value companies/assets and summarize industry themes.
In S&T, what does your day-to-day actually consist of? Do you spend time on the phone, are you entering trades into a software program to actually execute them, etc... Do you also use Excel and PPT? My Bloomberg experience is limited to pulling betas. Why is every trader seemingly on Bloomberg every second that the market is open?
Feels kind of weird that I've been around the finance industry for 5 years now between internships and full-time and still don't understand what my colleagues on the trading floor are actually spending all day doing so hopefully someone can shed some light on the actual tasks you perform. Thanks in advance.
I straight up asked a trader this question and have been searching the internet for an answer. Hoping someone can give me a break down of what it looks like on the sales side and trading side.
Yes, with clients, other traders and the sales guys
Yes
Yes, Excel for most things, PPT when sales needs slides for a client
Because that's where you get real time price data and news from. Also the Bloomberg chat function.
Source: Internship on FX trading desk
I'm in trading but a bit removed from what I was doing as an analyst/associate. That said, here's what I got:
Most of my job is about portfolio management. We have 1000s of client trades plus our hedges in the book, and the job is to figure out how to smartly manage the aggregate risk there. That might mean keeping some risks on, or working to scratch on some of them. It's also important for us to understand our market's liquidity. Why go to a broker to work out of something a few ticks worse than mids when I can find someone with an axe who will pay me some bid/offer on it?
The other major part of trading is being able to price stuff. Often times clients want some sort of structured deal, or to run some scenarios on different vol strategies. Our job is to quickly and accurately get that information to them, in the hopes of getting some flow. By being at a bank, we're always short an option (if we misprice, the client either doesn't trade or runs us over).
The trading day has regular busy and boring moments, but is overall not that well-structured. I rarely take meetings during the day unless it's for a big deal, or a client wants to get on the phone with me at the time. I mostly spend time reading, watching the market, and thinking about where stuff is being mispriced, or pricing up stuff.
Yes - lots of time on the phone talking to sales, other traders (both internal and external) and clients. Excel is still the bread and butter spreadsheet, although I would say our sheets are more geared towards functionality over aesthetics. Nobody else is looking at our sheets or judging stuff like formatting. I rarely use ppt unless a sales guy sends me some client presentation to review.
We have a screen to do some trades - that involves clicking some buttons on an app. However, most of the trades I do are through people - either chatting with sales, talking to other traders, or through brokers.
Bloomberg has real time charts, pricing, and news (think of what you see on the stereotypical 6-screen trader workstation). The biggest thing for me is that the main IM program for the market is on Bloomberg. Instant Bloomberg is sort of the standard for both internal and external communications, and can be used to do trades, and confirm the details and timestamps of them. Despite the stereotypes, traders actually spend a large portion of their days communicating with people - we are probably talking more and to more people than a typical banker.
Appreciate you taking the time to write this, very helpful !
Thanks, this was a great explanation.
I’m a trader and run a book - here’s what I do:
7am-10am - send out my inventory, give long winded speech on sales call about market direction and offerings I would like to move, ask sales about flow inquiry, call brokers/other traders about market/shit I’m bidding in the am, trade shit, read desk analyst research, watch economic event numbers roll through
11am-1pm - Bidding so many deals my brain is melting, buying bonds, sharing/sending out to sales and posting on my screens, basically this is prime money making time. Also posting other traders on markets, yelling on my turret mic about shit I just bought
2pm - market close
Still trading my positions, have risk calls, usually put hedges on around this time, eyes feel like they’re bleeding at this point, wrap up the day by checking book PnL to make sure it’s accurate, read more research, formulate hypothesis for positioning the next day
A lot of your day revolves around waiting for positions to trade on your screens and figuring out how to reposition, and running risk/sales calls...not as complex as you all think it is
I’m a credit trader and this is pretty much it apart from my market closes at 5ish. Hard to describe when you have a ton of trades all day how difficult it is to get other stuff done. Reading research reports/doing RV work can take an age.
What's RV?
Thunk they meant 2pm until market close
Are you at a BB?
Yessir
I've done both IB and S&T (at BBs), and I offered my big picture comparison here: https://www.wallstreetoasis.com/forums/why-choose-sales-and-trading-ove… .
On what people actually do in S&T, it varies by desk/asset class. But by and large, the day is split in three: opening, closing, and whatever's in the middle. Your life will vary slightly depending on Sales or Trading. We tend to forget about Research and Structuring. Research's life is pretty separate. Structuring sits on the floor with the rest of S&T; one way to think of their role is 50% sales, 25% Research, 25% trading, and way less bonus.
MORNINGS/OPENING: Folks usually come in around 0600-0730: in before the market opens (depending on desk). Rates/FX usually come in sooner, Commodities often later.
The morning is usually used to get current on what's happened, both in the real world and the markets. You'll see this in Bloomberg News, in your emails, and every day your bank is pumping out some kind of research.
If you're in Sales, you're thinking about all this in order to see what kind of blast/commentary/update/research you're going to provide your clients. You'll call them, chat them on Bloomberg, or email them.
If you're in Trading, you're really more concerned about your positions.
Coffee tends to be essential during this stage.
AFTERNOON/CLOSING:
Usually, about 10 hours after coming in (see above), you know that time's running out for clients to trade, and closing prices may matter more or less in your asset class. Research is less relevant at this stage, but you may have been negotiating a deal you were closing; you may have been waiting for some kind of approval on a quote you've offered; you may need to unwind a trade, etc.
This is usually the last hurrah of the day before closing up. You either go home, go see friends, or go see clients. Someone in, say, institutional FX S&T who doesn't have a client dinner might be out of the building by 6pm. Someone in distressed debt with a lot of covenants to examine might stay until much later. If you're in Credit Sales, you might have to take your clients out to golf or to a Knicks match. Better be able to handle your alcohol better than they can. If you're a trader and your positions are killing it, you better go home and get laid. If you're a trader and your positions are in the dog house, you're probably going to spend a few extra hours stressing in vain about what you can do.
IN-BETWEEN
This is when everything else happens. Internal meetings; client meetings; internal politics; improving your desk's pricing models; liaising with Risk; putting together Sales pitches; preparing an internal proposing to set up a new legal structure or trade flow with some application to cross-border trades; coffee with Research; playing pranks on the intern, etc etc.
I am interested in sales and brokers (IDB) roles in all this.
If I am reading right, the traders day is spent managing the portfolio and executing trades.
Is the sale guy talking to sales guys from other banks telling them what the traders want to bu or sell?
Where do brokers like RJ Obrien fit in?
Sales talk to investors. Pension funds, insurers, hedge funds etc etc
Sales generally don’t cover banks ( not strictly true as they will cover some parts but for example JPM credit do not talk at all to MS credit)
This is where IDBs come in, they sit in between bank desks. So for example JPM credit wants to unload some risk, they may trade via the IDB with MS or others on a no name give up basis ( apart from swaps).
Sales at a bank generally requires (depending on product) anything from a little market/fundamental knowledge to a lot. Some desks your role will be close to a trader.
IDBs require almost no academic intelligence, purely a relationship game. Be mates with the big bank traders and you’ll make a small fortune. Heavy heavy lifestyle though.
Thanks
Given the color provided here, how does automation play into this and what is exactly being automated?
delete
It varies a lot by desk but trading is incredibly interesting, and even so at the analyst level. I sit in a trading desk but feel like most of what has said covers what I see day to day. Something worth mentioning is that you get a TON of responsibility early on. I work within the field of derivs and at 6-7 months they have you trading small stuff, hedging positions, and working with brokers. So you are always just looking at your risk, looking at vols, the screens, where the market is going, and so forth.
So you get to manage risk (supervised, ofc) during your first year. You also provide trade ideas, market color to sales, and so on. And of course do a lot of shitty operational work like fixing trade breaks, speaking with tech/ops, etc.
One last thing I'll add is that teams tend to be quite flat in terms of hierarchy. You get to sit in a row next to the head of the desk, or your MD and be seemingly doing the same things (to an extent). From speaking with friends in IB, it seems like over there people fear many VPs/Dirs/MDs, and often times rarely speak to them. In trading it is common to be very close with your bosses, go out for drinks, banter during the day, etc. Very different environment for sure.
Anyone know S&T roles that take in Masters students? Really interested in FX but not exclusive to it.
bump
shameless self bump
Depends on the type of Masters degree. I think when I was starting out, MFEs and non-MBA masters student came into our analyst class, and the MBAs came in as associates. It's quite uncommon for MBAs to go to S&T though. My guess is that you should treat your last semester of master's sort of like senior year for recruiting, but times may have changed since I was that age.
Im in a Masters of Finance program, I don't see a lot of open roles. Typically recruiting is for undergrads and MBA's so it's been hard. If you have any advice off that I would really appreciate it, thank you.
dude what do you mean, do you have a prior internship or not? as if not then that’s what’s holding you back and not the MFin
i stare at my price charts ticking all day long
stare at various news feeds (twitter, bloomberg, etc..)
make markets to clients...bidding and offering whatever securities they want to trade, that are in my sector
always ask the question "is it different this time?" about every 5-15 minutes...every day of my life the market is open...and scour news and price charts looking for that possibility
prop trade my back book all day long
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