What do you guys think?
Obviously firms have already started utilizing algos to replicate a trader, but how do you think this will look 5-10 years from now? My firm is now encouraging all traders to learn quant skills (Python, R, C++, etc.). Is the outlook for traders contracting?
It's definitely changing. Barclays just addressed traders to pick up Python. Man Group head said old school traders at the firm are whiney and unwilling to learn coding or scripting, which is a big mistake. Listen, will manual trading be around, yes... Will you get discarded by notable firms, probably yes or who knows, maybe not? But someone who has the same level skill set as you but can code will surely get the job over you.
If you can trade, program and do machine learning, I guarantee you're going to make millions. If you're a trader who cant program, you'll become obsolete. If you're a data scientist but don't have to passion to trade, you WILL become obsolete because there will be someone else who will want to do it all.
having those skills just gets you into the seat.. making $ is a separate challenge
Like I said, if you can trade.
Follow-up question to this, as a trader on the buy side, I totally see your point as to why coding would be useful for generating trade ideas. However, on a Muni, High Yield, Leveraged Loan desk, or anything that is illiquid but still has flow, how would coding/programming on the Sell-Side be helpful? This is not a troll, I'm genuinely curious as through my (limited) experience interning on a Sell-Side desk, I wonder where/how those skills would be useful in the day-to-day.
it's kinda not useful for those desks or any of the straightforward illiquid stuff (usually bonds)... yet
places where coding adds value would be anything involving derivatives, some preexisting electronic platform, or for desks that actively take of risk (strategy development).
if you're talking about corporate bonds/loans.. they can just collect spread and make $$ although that is beginning to change in IG. Clients do a lot of RV, so maybe hiring that Python kid to build screeners makes more sense than the marginal laxxer idk mate
I don't think it's coming to an end in the next 7-10 years. If anything I think the reverse will happen. Though I am not a quant myself (in progress to become one) many of my friends are algo traders or quants and have mentioned to me that they think there is only so far technology can take trading.
They also showed me this article which explains a bit as to why "The age of quants is coming to an end": https://news.efinancialcareers.com/uk-en/3000245/quant-jobs-going-down .
It's funny both sides is looking to the other for advice on where the ship is sailing...
if you wanna know what bank trading floors will look like in 3-5 years, look no further than citadel's job page... every trader posting requires coding knowledge (but no more than python)
We are approaching the inflection point, but the inflection point will be when a quant and a flow trader share similar skills. If you think flow desks (bonds, commodities, etc) cannot use quant skills to better do the job you are sorely mistaken. Similar to how way back vba macros start to make lives easier for everyone else.
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