Entry Barriers To a Professional Trading Career

Discussion in 'Professional Trading' started by tradertony76, May 1, 2006.

  1. Hi all,

    As a recent graduate in financial markets, I felt like posting some of my thoughts and experiences from my recent job hunt. I've been making the circuit applying for junior trader jobs all around Chicago.

    In my previous life as an IT consultant, I am used to throwing out a resume and getting tons of interest from recruiters. However, looking for trading jobs is totally different. Whenever I log into job search sites, I see little animated tumbleweeds blowing past my resume.

    Frustrated, I figured I'd vent on ET about some of the barriers to entry I've encountered while job searching.

    1) Firm Secrecy: Even *FINDING* firms to apply to can be challenging. Sure, there are your standards like Peak 6, Optiver, Jump, Velocity, etc. However it seems like a lot of the trading firms out there dont advertise, and a lot dont even have web sites. Unless you're in the business, they're "invisible".

    A humorous anecdote, I was at a recent job fair. I saw a company on the roster called "Cardiff Giant Trading". Apart from a movie referece, the Cardiff Giant is also a famous American hoax.

    I was speaking to their recruiters, mentioned I had never heard of them and asked what was up with the name.

    They told me they were actually from one of the largest and most prestigious firms in town, however, they dont like to draw attention to themselves. So, whenever they are looking for people, they check into career fairs under a bogus name. They proceeded to tell me if a candidate with the Right Stuff approached them they would have no problem hiring them right away, but otherwise they just go to career events to scout the scene. Ugh.

    I know of no other industry where you cant even find out who you are applying to until THEY want you to know !

    2) Ya Gotta Know Someone: The easiest way to get into the business is to know someone. Trading is a very insular world. If you dont have friends or colleagues in the business, it can be a tough, almost impossible industry to get into.

    3) Pedigree: If you dont know someone, pedigree is a huge advantage. If your diploma says MIT, University of Chicago, etc, you're golden. If not, well, you'd better do well on your aptitude test(see below). Trading firms seek to hire what they beleive are the absolute top talent in the world.

    4) Tests, tests,tests:If you dont know someone and dont have a college pedigree, then you get to take the aptitude test. Trading firms do not care what prior work experience your bring to the table. They do not care whether you earned a degree specific to trading, or if you earn a B.S. in the mating habits of the north american screech weasel.

    Rather, most firms toss your resume and cover letter and make all candidates take an aptitude test, which usually are designed such that 15-20% of the applicants will pass. Then they pick the best candidate out of the people who pass the test. This lets them get the "geniuses" who didnt graduate from ivy league schools.

    There is never any studying you can do for the tests and you never know what to expect: It can be a Mensa IQ test, quantitative reasoning, speed arithmetic.

    There usually are no retakes of the exam, so if you have a bad run at it, cross that firm off your list.

    5) Age: A lot of firms seem to prefer young candidates who just receieved their BS, or earned their MS immediately following their BS. My feeling is that if you have prior work experience in another industry, it lessens your desirability to trading firms. I may be wrong here. Has anyone has different experiences regarding age ?

    Anyways, maybe I'm way off base here and cynical because my job search has been so difficult. However, these were my observations based on what I have seen while hunting.

    Comments ?

  2. Confirmation of the Obvious. (1) Did you graduate from IIT? (2) If nothing works out, you have to be willing to go it alone. Instead of being someone else's employee, you'll have to become your own boss real fast and somehow trade your own money. (3) You'll have to treat the application process like a "numbers game" and send out as many resumes/applications as possible. (4) IT attracts people who are interested in IT. Trading attracts EVERYBODY. Why bother with a "career" when you might get super-rich from trading? (5) If trading doesn't pan out for you, consider getting an IT job with some type of financial organization AND dropping all desire to ever get involved with trading. (6) Re-read what I said in (2) above.
  3. I too was in IT and traded in between gigs and full time on and off since 1986. (I turned down a Microsoft employment to become a stockbroker). And I have to say this. There are lot more IT jobs than trader jobs. Consider the trend when machines will replace fund managers your odds to be a trader as a job are minuscule. The good news is you can trade part time for yourself and retire rich. Now which one will it be? A struggle to break into an industry or to use your head and take it easy?
  4. WD40


    if you know how to trade, you don't need a job.
  5. DJR


    if 95% of traders fail. then it should be hard to get a job trading.
    i agree its more on who you know than what you know....i myself just got lucky and was delivering cheques for a broker when asked to switch jobs...right time/right place.
    a lot of places just play the numbers game and hire and fire at a whim. you may as well try that and send in as many resumes as possible. even if the job is crap it may get your foot in the door. dont do what friends of mine did and try and hold out for the dream job. some of them are now flipping burgers.
  6. tomcole


    IT guys at large trade houses make very good money with none of the risk of being a trader. Its a very good gig.
  7. Actually, you guys do not know how good you have it.

    The securities business has always been very secretive...
    But the internet has changed everything.

    Today you can glean 80-90% full information...
    About costs, leverage, career options, registration procedures, inside stuff.
    10 years ago everybody just lied to your face.


    :cool: :cool: :cool:
  8. FredBloggs

    FredBloggs Guest


    id follow tomcoles advise - get in via an it job with your current skills then try & move across if you still want to.

    i was kinda lucky and got there via route 2, but in general, if any company acted like the tards you mention in your post, id tell em to eat my shorts - i wouldnt wanna work for them anyway.

    trading is about freedom, not about working 14 hour days for some twerp for $100k plus bonus if the twerp likes you.

    i know all the firms want top degrees etc, but every trader i know who is any good dont see how qualifications make you a better trader. the best traders i know are street fighters, not book worms.

    the times they are a changin'!

    good luck.
  9. Thanks to everyone who has posted their advice !

    I'll probably post more here later when I get the time.