How do I get a job at proprietary trading firm?

[JSOP]

For just a few 100 g's, I'd be working as an engineer, lawyer, or doctor being a productive member of society.

Agree with everything that you said except this one. We traders ARE a productive member of the society. Just because we trade that doesn't mean we are not contributing to society.

 

[JSOP]

Well, time to do some remedial mathematics. Let's assume for a second that your personal trading is making 30% ROC and you are starting with 100k (very reasonable, if not too aggressive assumptions for most of the population). As a fairly junior trader at say DRW, you are probably taking home 350k. How long do you need to be trading your personal account to have an income equivalent to that of a junior trader at DRW? For simplicity, feel free to assume that you do not need to eat, never get sick and you can sleep in a cardboard box under the Brooklyn Bridge.

Five years and you will be making $371K, more than the take-home pay of a junior trader already, and after that, the sky is the limit!

 

[wwatson1]

I just finished bachelor's degree - Business management.

But that just the degree ..I have more than 20 years of experience in day trading and investment.

How do I get a job at proprietary trading firm?
Just a bachelor's degree and experience is enough or do I have to study a particular course?
if a particular course what do I need to study?

And if any particular studies is not required ..how else I can get a job at those proprietary trading firms.

I wouldn’t bother, recon it would be crap anyway

 

[digitalnomad]

Five years and you will be making $371K, more than the take-home pay of a junior trader already, and after that, the sky is the limit!

Not probable, but possible. More likely lose his shirt and pants within 5 years.

 

[schweiz]

Well, time to do some remedial mathematics. Let's assume for a second that your personal trading is making 30% ROC

I know from personal experience that with 30% a year you can get millions from private customers in a short time.
If you have 10 million AUM you take 20% on 3 million profit, so 600K (so above +-6 million AUM you beat the 350K salary). I know investment clubs of wealthy people that can put that amount on the table without individual risking more than just a 1 month income.
I have a friend that runs a fund for them with low risk and single digit profits.
How many will ever get a junior trader job in these famous firms?

 

[qlai]

murders & executions background.

Lol

 

[CME Observer]

Did you really read what CME overserver said ?
He said ..you’ll be hired as an assistant trader via the process

That is exactly is my solution..... it is not really operational role ...its sorta internship ...you learn while assisting your main trader...

May I suggest ...STOP RESPONDING TO MY QUESTIONS.. SAVE MY TIME AND YOURS ..I don't like dumb and sarcastic people wasting my time and energy.

Lol CME overserver?! I like that! Should open a bar by the CME building and start really making money when the interview season starts back up!

 

[CME Observer]

@blueraincap Regarding being shut out of the industry—truthfully I don’t know if that’s true or not of the specific type of prop shops we’re discussing here (Chicago OMM), but in my experience this is not true of all of prop trading. Physical commodity trading for example will take someone from just about any background (not a bad background, just more diverse), stick them in a scheduling or logistical role, and of that class of 5 schedulers maybe 2 or 3 will be traders within the next half a decade. I’ll defer to @sle for experience entering in other ways besides campus and commod as I’m really not an industry vet by any stretch.

 

[CME Observer]

you're probably not going to get a job at a prop firm unless you go to one of those bucketshop types with huge turnover that require upfront capital.

not sure why you'd want a job at a prop firm though if you're a discretionary trader. maybe 10-20 years ago that would have been helpful but with current technology and internet services available, it's completely unnecessary.

do you lack capital? work a day job while trading on the side until you become profitable and have enough capital.

don't wanna do that? sure, take a shot at topsteptrader or oneuptrader which will give you capital as long as you can pass their tests. if you don't pass the tests, well good! you would have lost money trading your own money anyway so in a way, you saved yourself some money.

are you seeking mentorship or learning to become a better trader? welcome to one of the greatest equalizers of the 21st century: the internet! quality mentorship in real life in this field is already extremely rare and quite often involves a ton of luck/connections in the first place. the good thing is so many teachings about trading are available online, either in forums like this or private chatrooms, etc. almost all trading books can be found on libgen for free. there are just so many resources available to you in today's world that can help you grow as a trader right inside your computer.

commissions are cheaper than ever. trading platforms are more sophisticated than ever. spreads are tighter than ever due to algos and market makers. honestly, this is the best time in modern history to be a retail trader. i'd just embrace it if i were you.

people keep blabbering on about how the quants and their algos are creating an uneven playing field. it's total bullshit. you have to realize quant trading firms compete with OTHER quant trading firms due to the strats they use. most of them are employing similar strategies chasing after the same inefficiences which is why alpha in the quant trading world has dramatically reduced, esp when inefficiences lack scale. just look at how quant funds have been getting killed left and right the past year. you'd think a fund filled with the best mathematicians, computer scientists, statisticians, physicists, etc. would obviously beat those uncouth, discretionary trading liberal arts majoring scum. it's almost a disgrace that they aren't all outright outperforming discretionary oriented funds by a solid 30-40% across the board given they're all geniuses from the very best schools but that's the reality of it.

just keep working on your trading skills in the mean time. the great thing about trading is it's probably the only profession in the world where your income can be compounded minute by minute. it's really fucking easy to run up your account balance when you get good at this, more than whatever you'll be earning as a trader at Akuna, DRW, DV Trading, etc.

honestly i don't get why people here have such a hard on for firms like Akuna or DRW. They'll hire talented quants for around 300k-500k only to milk their strategies for TENS of millions of dollars. then when those quants are upset with how much they're getting fucked in the ass and attempt to leave, these firms will pursue all legal avenues possible to make their lives miserable for their 'betrayal.' you ain't gonna be earning millions working at these prop firms and if you were the type of person just trying to earn a few 100k dollars a year, then wtf are you doing trading? For just a few 100 g's, I'd be working as an engineer, lawyer, or doctor being a productive member of society. Eventually any trader who wants to earn real money is going to have to go out on his own. That's the end game in this profession. So don't worry about prop firms not hiring you. If you are to ever make it big in this game, you're gonna have to work for yourself anyway, just like any other retail trader.

Generally people right out of school or shortly thereafter pursue these jobs because they’re motivated by the challenge, interested in the field, and want mentorship in and education in this space. Indeed people are extremely interested in these jobs, it’s not just on this forum. In my experience as a recent graduate from a competitive school a large percentage of the nerdy people went into this line of work. Prop trading also interests a lot of engineering types that fill quant and IT roles. The optionality of a strat or IT role right out of school may actually be higher when you account for tradings attrition rate. Some people just don’t become profitable, whereas an IT or strategist background remains transferable. It’s probably close to irrelevant because the trader who just washed out still has a 3.9 from an Ivy and a beautiful mind and they’re all still young.

If you didn’t join for the reasons discussed above then you’re an experienced trader. Logically and as alluded to above, the firm would only hire an experienced if they expected them to be profitable. If you’re smart enough to have a profitable strategy you’re smart enough to evaluate the cost benefit of applying for a job. So what benefit would this confere to you as the experienced trader?
1. focus on trading, not:
a) IT
b) Position reconciliation
c) running a business, catered breakfast, health insurance, etc.
2. learn something
3. social life
4. paycheck
5. a prop desk has an economy of scale relative to the individual trader.

 

[sle]

Do you actually get to define your own risk parameters and make your trading decisions based on them or do you have a set risk management model that you have to follow in trading or managing your portfolio?

As a PM/prop trader, you get risk limits set by the management (capital, VaR, drawdown, sometimes things like delta/gamma etc). How you follow them is your own business. As a junior trader your PM will usually get you to use his preferred way of managing risk.

Five years and you will be making $371K, more than the take-home pay of a junior trader already, and after that, the sky is the limit!

First of all, I rather clearly said "income", dude, not "assets". So the question is a number of years to start taking home per year as much as a DRW monkey his first year. In a world of perfect strategies and simple compounding, it would take about 10 years to start earning 350k (assuming full reinvestment of profits):

100 * (1 + 30%) ^ N = 350 / 0.3 and solve for N

However, if you are living in a semi-real world where you Sharpe is not infinite (yet you still spend nothing otherwise), you have a strong path dependency and suddenly it will take you longer depending on the number of down years.

I know from personal experience that with 30% a year you can get millions from private customers in a short time.
If you have 10 million AUM you take 20% on 3 million profit, so 600K (so above +-6 million AUM you beat the 350K salary). I know investment clubs of wealthy people that can put that amount on the table without individual risking more than just a 1 month income.
I have a friend that runs a fund for them with low risk and single digit profits.
How many will ever get a junior trader job in these famous firms?

Look, we all know that you are a master of your intraday strategy, you have infinite capacity with a Sharpe of 6 and you know hordes of billionaires. Most people, however, would not be able to raise a penny without a long track record (let's say 5 years). I also doubt anyone would give multiple millions to manage before the trader himself has at least a million of his own money under management.