Previous trading experience?

cjbuckley4

cjbuckley4

Obviously, the thread title doesn't connote much confidence, but I wanted to pick the brains of some of the people on this forum regarding my situation.

Situation:
It's my junior year--time to get an internship that has a lot of influence on my first professional job. I have interviews with a couple prop shops and hedge funds that have expressed interest before this year, and I just began the application process for the remaining companies this week. I will continue to turn over stones for a while. My first "final round" interview with the potential to actually get me an internship is in three weeks.

About me:
Previous experience: internship as a software developer and as an analyst in an investment bank. Both places have said (verbally) that they'd be willing to take me back.
College: Good school, math & stats major with C.S. concentration. Middling to low GPA. Captain of sports team.

This forum is littered with the online signatures of people trying to break into "legit" prop trading. Maybe some did and they now don't post because they have NDAs, but my experience on EliteTrader thus far tells me otherwise. I think a lot of them are now silent because they must face the unfortunate reality that they aren't competitive for entry level roles in this industry.

I am the definition of "selection bias." I have known I wanted to be a trader since I was in high school. I never had any real delusions of getting rich just by looking at charts all day as an individual, I've always just wanted to be a part of a team that does automated trading.

That being said, once I graduate, I'm not going to take a job at an "arcade" or the like. If I don't get a job in prop trading, I'm either going to find a job as a software developer closer to home or go back to my software internship from this summer. I love trading, but I'm not going to take a job without a salary or pay to have someone teach me Technical Analysis.

Question:
I know "legit" prop shops see working at "arcades" as negative work experience, effectively. If I was to work as a software developer for a few years and trade my own money systematically, how would prop shops look upon this if I later attempted to get into the industry as a software developer with work experience? I guess I'm just nervous about interviews coming up. Thanks for taking the time to read my question.
 
I am no recruiter nor am I a hiring manager. But from my past communiques with you, you are person with high intelligence and initiative. Given that and the pedigree of your school, I would expect no less than the top firms for you. And, I reference knowing many similar people like yourself who have managed to get "in".

Set your sights high. Read those interview books and record yourself in mock interviews. Hire a consultant! You already have a quarter million in your education at least. Get pumped, put on a $1,000 suit, a pair of Allen Edmonds and put a huge gob of brilliantine in your hair. It's all about your presentation at this point. Best of luck.
 
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@EquityGuy4321 I appreciate your reply, and I agree that getting into a big institution is probably better from an exit opportunity standpoint. Does this imply that I should try to go to a bank? Having done that before, I'm not sure how I'd feel about a bank, nor am I sure if I'm even competitive for a S&T role a lot of places. I applied to the BB S&T desks, but I'm not sure we're gonna be each other's first choices. I really want to go into market making and HFT and I'm not sure S&T is the way to get there. I also live in Manhattan now and I get tired of dressing up and then sweating on the subway in my nice clothes. Two of the hedge funds I have interviews at have a lot of "name cache" as well, but they want me for software roles. I have no problem with a software role really, I actually see it as a better long term career move than trading, but I'm interested in trading and would like to at least try it before I decided to stick to software. Entry pay is higher for software. My first choice wants me for a quant dev type of role. You do two rotations with software groups during training and spend the rest learning about trading. Can you perhaps help me understand the reasoning behind going to a big institution? Do you think a prop shop is not going to move my career or resume forward as quickly?

@xandman thanks for your kind words! I wish you were a recruiter. In all seriousness, you've given me some good advice about getting a job. I will probably stick with what Career Services provides for resume and interview coaching for this year as we're only talking about an internship, but perhaps if I need one for full time work I'll get one. You're probably at least partially right about likability being a factor. The itinerary for final rounds at one place I'm interviewing seems to allow for a Friday night outing. I do need to improve my interviewing skills. I think just general probabilistic intuition and a basic knowledge of options are the best preparation possible from the questions I've faced so far. I picked up Natenberg's book, so hopefully that's a worthwhile read as I've never been that into options, historically. I'll be honest with you, if I'm asked mental math questions, that could be the end of my quant trading career before it starts. I've been pleasantly surprised by how little I've needed to wear a suit so far. Most places so far have said to dress casual in their invites. I left my good suit (roughly 350 dollars I think) at my parents' beach house after a wedding this summer, so now I either need to borrow my roommate's or go get it.

@wwatson1 I'm too undercapitalized to have an answer for that. I suppose if you checked back in two plus years I could give you a better idea.

@Ferdinand I'm not inclined to give examples right now, but a legit prop firm pays a salary in exchange for services rendered. You operate as part of a team of traders, quants, and software people. Arcades, in my mind, are firms where you invest capital as a class B member and trade that money with ultimate responsibility falling on you, the individual. They usually offer training in their niche.
 
Don't under estimate the internship. That's where the easily identifiable opportunities come from. And, you know what your getting when the internship is done. If you already beat your classmates to the internship, it is going to be hard to outdo that against the total population of (Ivy) grads.

After graduation, companies will also be selling themselves to you. IT jobs (no potential for PnL responsibility) are easily masked as trading jobs.
 
I'm too far removed from the East Coast to comment specifically. But the best way I've found in general not to get stuck in a dead end job is to focus on the salary differential between you and your immediate boss. Your boss's salary is much more indicative than yours. Gives you an idea if you'd be stuck in a pure IT role and what your upside potential would be.

Also, be relaxed during the interview. Anxiety isn't super attractive.

Arcades are a negative. Trading on your own is a soft negative (brings up lots or questions about rationale and opportunity cost at a young age). If you do either of the above it will likely turn into a permanent situation so it BETTER work out.

If it were me I'd go to Jump or Teza
I'd avoid KCG, Tower or Virtu. Not really bad places but the others are better from the inside.
 
cjbuckley4 said:
Obviously, the thread title doesn't connote much confidence, but I wanted to pick the brains of some of the people on this forum regarding my situation.

Situation:
It's my junior year--time to get an internship that has a lot of influence on my first professional job. I have interviews with a couple prop shops and hedge funds that have expressed interest before this year, and I just began the application process for the remaining companies this week. I will continue to turn over stones for a while. My first "final round" interview with the potential to actually get me an internship is in three weeks.

About me:
Previous experience: internship as a software developer and as an analyst in an investment bank. Both places have said (verbally) that they'd be willing to take me back.
College: Good school, math & stats major with C.S. concentration. Middling to low GPA. Captain of sports team.

This forum is littered with the online signatures of people trying to break into "legit" prop trading. Maybe some did and they now don't post because they have NDAs, but my experience on EliteTrader thus far tells me otherwise. I think a lot of them are now silent because they must face the unfortunate reality that they aren't competitive for entry level roles in this industry.

I am the definition of "selection bias." I have known I wanted to be a trader since I was in high school. I never had any real delusions of getting rich just by looking at charts all day as an individual, I've always just wanted to be a part of a team that does automated trading.

That being said, once I graduate, I'm not going to take a job at an "arcade" or the like. If I don't get a job in prop trading, I'm either going to find a job as a software developer closer to home or go back to my software internship from this summer. I love trading, but I'm not going to take a job without a salary or pay to have someone teach me Technical Analysis.

Question:
I know "legit" prop shops see working at "arcades" as negative work experience, effectively. If I was to work as a software developer for a few years and trade my own money systematically, how would prop shops look upon this if I later attempted to get into the industry as a software developer with work experience? I guess I'm just nervous about interviews coming up. Thanks for taking the time to read my question.
More...

I have a friend who is in a similar position who just graduated and took a job as a trainee trader in a large prop firm. Im positive he doesn't make as much as a junior analyst at an investment bank or HF.

Im sure you have heard stories about how guys are rinsed out after one year, very few actually make it and your not going to learn some great secret about trading from a prop firm.

If I was in your position I would take a position in an investment bank or hedge fund, its a different class of guys in those places compared to the wear jeans to work types in those arcade style places.

Working as a trader at X prop firm doesn't have the same carry on your CV as S&T at Goldman/JP Morgan or associate at Citadel/Bridgewater.
 
garachen said:
I'm too far removed from the East Coast to comment specifically. But the best way I've found in general not to get stuck in a dead end job is to focus on the salary differential between you and your immediate boss. Your boss's salary is much more indicative than yours. Gives you an idea if you'd be stuck in a pure IT role and what your upside potential would be.

Also, be relaxed during the interview. Anxiety isn't super attractive.

Arcades are a negative. Trading on your own is a soft negative (brings up lots or questions about rationale and opportunity cost at a young age). If you do either of the above it will likely turn into a permanent situation so it BETTER work out.

If it were me I'd go to Jump or Teza
I'd avoid KCG, Tower or Virtu. Not really bad places but the others are better from the inside.
More...

That's good advice about the salary differential. I have looked for this kind of information at a couple places, and it's difficult to really infer directly what position would be my boss in some cases, but I think the hedge funds that recruit here and do Columbia's OCI stuff are generally the best in that regard. Starting salary isn't bad, I'm not sure how much I'd actually get to learn about trading though. They don't seem like terrible places to remain somewhat relegated to software development. In terms of job stability and quality of life, as well as potential to continue to progress as a developer, I think they may be my best option. Jobs with OCIs at Columbia are competitive though, so we'll see.

I've applied to both Teza and Jump. Haven't heard back from Jump but Teza said they don't do internships. I have a couple leads with Chicago market makers. I think those are my most likely destinations. I will remain openminded.

I appreciate you letting me know how people will likely look upon retail trading. Given the opportunity, I'm definitely not going to be a retail trader if I can help it. I doubt I'll be able to stay away if I can't get a job in the industry though. I would be concerned about that, but I've had enough prescience to wait until I know what I'm doing so far.

Appreciate your guidance as always.
 
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