a few years back, i wasn't earning as much money as i wanted at home and talked with a headhunter who i knew (i previously worked as a techie in finance) regarding going back to a day job at a firm. she said based off of my skills, i could get hired as a trader at some firms...but i said i'd either make it on my own, or not do trading (and go back to being a techie). it's a few years on...and glad i could stick it out a little longer.
I've recently been contacted by a HF and interviewed with them 10 days ago. It's a fairly big fund with over $1B under management. I interviewed with 4 traders and the number one guy there, the HF founder who was a former CEO of a big invesment bank. As a price action only daytrader, I was extremely disappointed by their computer setups and charts. I had the impression that most of the trades there are based on information gathering, in fact that's where they invest a lot of money into. The fund is down over 10% YTD due to the fund manager being bullish on financials. I hope they survived this week. By any means I don't feel to judge their knowledge of the markets after interviewing with them for a few hours. However, I was not impressed by speaking to any of the guys there. I had very high expectations when I visited their offices, yet on my way back home I felt there are so many advantages the small trader has over these big fishes. The key is to learn how to trade and become consistently profitable. If you can achieve that on your own, you have complete freedom and power. It's an art nobody can ever take away from you. If they offer me the job I will certainly demand a very high fixed salary. If they say yes, I may consider joining up and see how it is. I am sure I could learn something, especially see how a big boy moves around the markets. If they say no, I'll continue on my own and enjoy my quality of life. As someone posted above, there are many resources available online that we can use to grow and learn from. it's up to us to be open minded and have the determination to keep growing and learning.
You were expecting a firm with $1b under management, to be set up in the same way a retail daytrader would?
Nope, I expected them to be set up a lot better and more sophisticated than a daytrader. If you read my post more carefully, you'll realize that I wasn't impressed at all by their setups. And trust me, there are traders there that do daytrading too.
"As a price action only daytrader, I was extremely disappointed by their computer setups and charts." It is hard for me to beleive that a "DAY TRADER" was intervewed for a Trading Position at a HedgeFund. No offense. Hedge funds are not to keen on "day traders". First, many require quant level math degrees. Second, 7% of the industry will liquidate, or near there, by end of the year. That is 7% of all total Hedge Funds. So, now your competing with MIT grad's and other "Hedge Fund" quant traders looking for a new Fund. I deal with Hedge Funds every day. It took me a hell of time getting involved in Private Equity with out being from the "Ivy" crew and being a X day trader for Schonfeld and Last Atlantis. I do not trade but broker deals between Funds and "Joint Venture" projects that they are interested in. Money is excellent and upside is unlimited for my earnings. However, I did inquire about trading positions and even though I deal with the Hedge Fund Community, they told me the truth of the matter. Not a shot in hell. The simple fact is "Day Trading" to the industry is not wel respected. Not sure why, as one of the top traders at my old firm ended up starting his own hedge fund. But the industry statistics on "Day traders" and the profitable years for 99% is known. Cash on Cash, many blow out or fail to make a consistent profit year over year. These are facts, not speculations. Now, with the Stock Market being manipulated, controlled and influenced by the GOV. Day trading may cool down for a few years, if not a full decaded, until those that run the markets come to their senses. There are a lot of highly qualifyed individuals out of jobs and will continue to be. This will flood the Trading world with key tallent far beyond that of "trading at home". If your profitable as a day trader, why go trade for a "FUND" anyways? Keep on doing what you do.
Thanks for your feedback. One of the first questions I asked these people was: Will I have to change my trading style? Will I have to switch from daytrading to medium-long term trading? The answer was a big NO. The fund manager clearly told me that they have all kinds of traders and that as long as you stay within their risk parameters, you can pretty much do whatever you want. From your post it sounds like math PHDs are the best choice for hedge funds. I honestly don't think there is a high correlation between math and trading, really. And it's not just my opinion. http://www.reuters.com/article/reutersEdge/idUSN1434596720070814 I am not sure whether these guys will still be around after this mess, they are fairly big and they were looking to expand and open a new branch until 10 days ago. I am very happy on my own, so the main reason i may consider joining this fund would be to learn about big boys from the inside.
Essentially I do work for a firm with a ton of capital, of which a percent is devoted to me. I do it with certain stipulations. I work when I want and where I want. Without those I am not sure I would have wanted the funding. I was on track to have enough capital built myself that I would have never needed funding from another source. This was supposed to be just a short cut.
The guys that trade their own money are said to be a LOT sharper and more competitive than the guys that don't. What are you going to know after the same 5-10 years of work...
Actually I believe you. I think for a 1$B , it's difficult for them to operate in the same markets as the little guys. I mean you can hardly expect them to be content with 150 lots on the fTSE future. So they have to do these huge volume but smaller ROCE per capita type trades . Diseconomies of scale. Also fact that head is a ex head of a IB would be big red flag for me.