Trader vs Financial Advisor; Passion vs Practicality

[CalScholar]

So, I'm graduating from university in a couple weeks (should have graduated in May, though I took the overly indulgent route) and I have the opportunity to join the trading desk at a small investment bank. I'd be assisting the head trader/market maker, and the role is intended to lead to a "senior trader" position. The bottom line: I love trading, not investing; and, based on my past results (outside of my blow-up a couple of years ago), I am confident that I can succeed in the trading arena.

Meanwhile, another opportunity as a financial advisor (for a leading firm) has presented itself. The bottom line: I have extensive sales experience with a track record of success, but I don't want to make a career in sales. Now, you're probably thinking, "Well there's your answer," but the discrepancy in pay leaves me wondering.

The trading firm is offering $30K + %profits, while the financial advisor role offers a base of $65-80K + commissions -- based on my experience and 7/63 licensing, I was told to expect an offer around $70K.

While I really want to go the trading route, the additional income from the advisor job, if saved, can finance a fairly generous personal trading account.

I'd appreciate any informed opinions, especially from people with knowledge about the salaries of experienced market makers. In other words, if I pursue the market maker route, and succeed in the role, what can I reasonably expect (salary-wise) 3-5 years from now and most likely at a different firm? Will starting at a small investment bank help me land a trading role at a larger firm in the future? Or is the opposite true?

 

[rosy2]

market maker in what types of securities?

financial advisor selling what types of advice to what types of clients?

 

[CalScholar]

Quote from rosy2:

market maker in what types of securities?

financial advisor selling what types of advice to what types of clients?

Market maker in midcap, independent oil and gas companies.

Financial Advisor serving high net worth clients (stocks, bonds, savings/retirement, etc.).

 

[CalScholar]

Quote from CalScholar:

Market maker in midcap, independent oil and gas companies.

Financial Advisor serving high net worth clients (stocks, bonds, savings/retirement, etc.).

Correction: Market maker in midcap, independent oil companies, primarily those focused on exploration and development.

 

[brownsfan019]

Cal - having been a salesman, I mean broker, myself as well straight of out of school, I would say follow your heart on this one. There will ALWAYS be a need for brokers that you can come back to later if need be. I know the money looks better RIGHT NOW, but I would suggest doing what you really want to do deep down. I'm guessing you're younger, so my suggestion is to follow your heart unless of course you have dependents that will be living off your income.

 

[rosy2]

Quote from CalScholar:

Market maker in midcap, independent oil and gas companies.

is this in regular exchange traded stocks?
what does this position do that a computer currently does not? making markets in a liquid transparent security with no barriers to entry isnt the most profitable thing.

Financial Advisor serving high net worth clients (stocks, bonds, savings/retirement, etc.).

the money is in the OTC sector servicing hedge funds, pensions, governments, and companies.

 

[CalScholar]

Brownsfan,

That's sort of the way I was looking at it, but I still don't know whether this market making role will lead to a serious trading role in the future. Again, I'm wondering if starting at a small I-Bank as a market maker will open or close doors in the future.


Rosy,

is this in regular exchange traded stocks?

OTC. Some less liquid than others, I suppose, based on share price as well as the indication I received from the prospective employer.

what does this position do that a computer currently does not? making markets in a liquid transparent security with no barriers to entry isnt the most profitable thing.

You're dancing all around my actual question. Not the most profitable thing? That's probably why they're only offering $30K. My question, as posed to Brownsfan and in the original post, is this:

What doors will this role open after spending 3-5 years on the job? Many? None? Depends?

 

[rosy2]

Quote from CalScholar:


Rosy,

You're dancing all around my actual question. Not the most profitable thing? That's probably why they're only offering $30K. My question, as posed to Brownsfan and in the original post, is this:

What doors will this role open after spending 3-5 years on the job? Many? None? Depends?

i am dancing all around your actual question because you never provided job descriptions. Marketmaker and financial adviser are only titles; they mean nothing.

so the answer is it depends on what you will be doing.

 

[CalScholar]

Quote from rosy2:

i am dancing all around your actual question because you never provided job descriptions. Marketmaker and financial adviser are only titles; they mean nothing.

so the answer is it depends on what you will be doing.

Fair enough.

 

[brownsfan019]

Quote from CalScholar:
My question, as posed to Brownsfan and in the original post, is this:

What doors will this role open after spending 3-5 years on the job? Many? None? Depends?

Cal - I think you'll find after being in the 'real world' for awhile that a resume is all about what you make it. In other words, go with your heart on this and even if it doesn't end up as planned, hire a resume writer and just like magic it will look like you were 2nd to the CEO. All kidding aside, whether the bank, MM or whatever is there for another 100 years or 3 years, bust your ass while there and you can always transition that experience into many different fields, incl being a broker.

And understand this - if you want to be a TRADER, you will NOT be doing ANY trading as a broker. Your job as a broker is simple - sell and gather assets. That's it. You get the $$$ and then it is sent to the fund managers. With compliance as it is today, as a broker you won't be doing much in the beginning besides selling mutual funds, managed money, etc. Plus, that's where the money is at, so you'll want to sell those. Gone are the days of reaping large stock trade commissions. Now, you have to bury those fees into a prospectus.