Please help me, option market making risk return, thanks

[Sig]

I'm 100% committed to trading and if that doesn't work, maybe I'll look into some quantitative finance related role. I don't mind working 80+ hour weeks for the right shop. It's not the hours that's my problem. It's how to pitch myself since my biggest weakness is networking and interviewing, a couple skills that I'd pretty much given up on developing. I plan to try something new i.e. getting myself in front of people and pitching through cold calling/emailing. Career wise I am stuck between "experienced" and "junior". I am looking to pitch myself as experienced and the only hang up is the hard numbers, which I don't have access too unfortunately. I guess I could always ask, but it would be a strange question to ask out of the blue.

I would like to run a market making desk first before I decide to go buy side as I don't have much research skills under my belt. And my school is not located in NY unfortunately.

You're trying to do something rather audacious. That's great, I'm all for it. I did something rather audacious as well after business school. However I'd say that a solid 80% of the value I received from business school was from building a network and 100% of my ability to start my first business was due to the network I built at school. So, if you've got access to alumni and classmates that's where you have to start if you want to do something like this. You're actually in the perfect informational interview stage, the "hey, this might be crazy but can I bounce some ideas off you" stage that most alumni, at least at my school, enjoy talking through with students. What you're trying to do has a low chance of success but you can probably figure out something similar with the help of your network. What you're trying to do has zero chance of success the way you're trying to make it happen.

As an aside, if you're going to business school but have decided that a. You're not able to network and b. You've given up on it and aren't going to try....then you're absolutely wasting your time at business school. I'm an introvert, hated networking and even the concept of networking. I was able to figure out my own way of doing it in a way that didn't seem crass or transactional and involved deeper relationships with fewer people, but it was a tough and painful road to get there. If you're not willing to put that effort in, then frankly I don't see the point. Sorry to be blunt, but I recognize what I see and am so thankful that someone gave me similarly blunt advice at the time.

 

[bone]

You're trying to do something rather audacious. That's great, I'm all for it.

There’s a fine line between ‘audacious’ and delusional. No one is going to hand some fresh faced kid with no obvious options trading experience and straight out of B-School $15M and let him manage his own options market making book.

To be able to snag an analyst job at a major trading desk would be a huge get for anyone graduating a top 5 B-School.

 

[Sig]

There’s a fine line between ‘audacious’ and delusional. No one is going to hand some fresh faced kid with no obvious options trading experience and straight out of B-School $15M and let him manage his own options market making book.

To be able to snag an analyst job at a major trading desk would be a huge get for anyone graduating a top 5 B-School.

For sure, but a VC will hand you that in an A round which is almost as crazy. No doubt if successful it won't look like he imagines it will look right now,but he could very well end up doing something that started from that idea. That's the beauty of a bunch of conversations with smart folks, it can help you iterate to an idea that works from the seed of one that perhaps doesn't.

 

[76132]

As an aside, if you're going to business school but have decided that a. You're not able to network and b. You've given up on it and aren't going to try....then you're absolutely wasting your time at business school. I'm an introvert, hated networking and even the concept of networking. I was able to figure out my own way of doing it in a way that didn't seem crass or transactional and involved deeper relationships with fewer people, but it was a tough and painful road to get there. If you're not willing to put that effort in, then frankly I don't see the point. Sorry to be blunt, but I recognize what I see and am so thankful that someone gave me similarly blunt advice at the time.

Yeah I plan on trying again but I get so bored talking about what classes I'm taking, what's my background, who's a good professor, where do I live, standing around in a circle and nodding my head, conversations about nothing, etc... Even without networking, I've learned a lot in Bschool so it hasn't been a complete waste. I've met traders at school, but it's always a bit weird reaching out to them, Hey, I know we just talked but can you pass my resume to someone in your firm, etc... Kinda makes it seem like the relationship is fake.

I'm going to try cold calling/emailing and reaching out to alumni for now to see if there are any hits and if doesn't work, I'll revisit my strategy. It's something done for banking recruitment so I am curious if it works for trading...

 

[76132]

In the mean time, I have an interview for an "execution" trader at a decent mutual fund company. That's gotta be more dead end than anything else? As at the end of the day I don't get to make any decisions, take on risk, manage portfolio, etc...

 

[Bum]

In the mean time, I have an interview for an "execution" trader at a decent mutual fund company. That's gotta be more dead end than anything else? As at the end of the day I don't get to make any decisions, take on risk, manage portfolio, etc...

If you've read any stories of other "famous" traders, some of them started out in the business with pretty "minimal" jobs but it was the "foot in the door" they needed. Most weren't hired because of their superior trading skills. That came later.

 

[bone]

In the mean time, I have an interview for an "execution" trader at a decent mutual fund company. That's gotta be more dead end than anything else? As at the end of the day I don't get to make any decisions, take on risk, manage portfolio, etc...

You aren’t going to be “taking on risk” and “making allocation decisions” straight out of school. Seriously. Get a grip.

You have to work your way into those situations. You have to earn the confidence and trust of the firm principals, and above all - you have to learn the considerable intricacies and machinations of the markets, what’s good risk/reward, how to model markets, how to execute trade entries, how to use trading software... there’s a hell of a lot to it on a Commercial or Prop Spec Desk. And mistakes will get your ass fired - because mistakes on a Desk more times than not have expensive consequences.

 

[76132]

Wow talk about good luck. Just found a job posting that fits exactly what I am looking for and I have the exact skills for it. It's like a perfect match. And yes it's OMM. Things are looking up.

 

[ETJ]

Good luck!

 

[ironchef]

You aren’t going to be “taking on risk” and “making allocation decisions” straight out of school. Seriously. Get a grip.

Maybe you spoke too soon.

Wow talk about good luck. Just found a job posting that fits exactly what I am looking for and I have the exact skills for it. It's like a perfect match. And yes it's OMM. Things are looking up.

Just make sure you grab it.