Life after Proprietary Trading?

Discussion in 'Professional Trading' started by ethanbrooke, Oct 13, 2001.

  1. fellow traders.

    My current credentials certainly do not warrant the question in the subject line just yet, as i am barely 3 months into my "life" as a prop trader.

    Here i the situation. When i was a freshman in college 3-4 years a`go, i read a feature article in "Fortune" about the the brave new world of young multi millionares who could make "karmas" and "honeys" in a day, worked sane hours and had access to the most dynamic trading environments that could seduce any naive college freshie. That company featured was Tradescape in New York. From that day, my single endeavour was to be part of that experience.

    When i graduated, i skipped any interviews with cookie cutter IBanking and Consulting firms, travelled halfway across the country to focused on only one firm, the firm featured in Fortune magazine, and today i am a proprietry daytrader with tradescape.

    The question is. While i feel that i worked very hard ( with no referrals) to be offered a position with tradescape and feel like i have the best job in the world..i have worries that in 2 - 4 years when i apply to business school this job as a proprietary day trader may bear little weight for consideration by any of the top 30 B-schools (say i have great GMATS and college GPAs). I mean where do we stand among the ibankers, consultants, analysts, peace corp!? applicants??.

    It just disturbes me that people may not appreciate the value of this profession as i worked damn hard and sacrifice damn much to get it and work it.

    If u share the same situation or concerns as me or have views about it please let me know, i would really appreciate any comments.

    god bless.
  2. Trading is one of the hardest professions in existence. After the 3 years of brain damage and hard work, i f you are gravitating towards success as a trader.......why in the world would you want to give it up and go back to school?!! The only benefit of school and degrees (from a capitalistic perspective) is a better job. So I ask again, assuming you are enjoying any of degree of success as a trader you will never need to impress a potential employer with an advanced business degree IMO. Reminds me of my neighbor who gave up a young but reasonably successful law practice to go to...................medical school! Now six years later, he is age 38 and enjoying the high stress and low income (relatively speaking) of an intern at a local hospital. Talk about brain damage.
  3. liltrdr


    If you are, then ask yourself if an MBA will make you more profitable. If yes, by all means go. If no, then forget it. The MBA market is highly correlated to the stock market. MBAs are highly sought after in booms. In bear markets...well just look at the recent IBank lay-offs. And if you're looking for respect from the establishment, don't bother. They look down on anybody who can play the game better than they can. Hell, they've been trying for years to shut down daytrading all together.

    But if you still want to go, push yourself as an entrepreneur who took a huge risk and made a huge return. Play up your uniqueness and they might let you in on the diversity ticket. Good luck man.
  4. gordo


    Just love this sight. Working in a major NYC wirehouse, it's refreshing to hear you all cut to the chase and put it on the table, especially as it relates to making a living trading and the respect of the establishment. Struggled with the same problem early on in my career. Needed to be one "in crowd", tried to get into investment banking. They didn't deam me worthy I guess. All the better, they afforded me the opportunity to direct my focus on the markets. Haven't looked back since. Still building capital and working through the transition to make the break to full time trading. But where else are you going to experience the freedom, intellectual stimulation, and comaradary along with potential earning power with out having to chase around with the rest of the crowd? If one is looking for the respect and validation of the establishment, forget them! As was well said, they generally do look down on those that can do it better than they can. Guess maybe they are rather embarassed for chasing the carrot for so long. A former good friend/roomate took that rout, I taught him more about the markets than he'll ever learn on his own. A year and a half later, haven't even gotten so much as phone call. So much for that crowd.

    Plan your trade, trade your plan - and know who your friends are. Let the rest of the world chase butterflies!
  5. Hitman


    Being a prop. trader myself, I started last October and it took me 3 and half month to get even. This year I am up 52K so far and since I have worked at GS, MER, and Saloman before, I have to tell you that I have passed the point of no return for so long that I don't even remember what it looks like anymore.

    If you are not meant to be a trader I really hope that you blow up early in your career so you still have time to pursue another career, I just turned 22 myself and I don't have a degree (I may pursue one part time), since it doesn't look like I am going to blow up next 12 month or so, I really hope I am meant to do this for life.

    A few years into a job with this much freedom and excitement, I just can't see myself going back to any 9-5 job for the rest of my life. Obviously, I will have to if I do blow up, but for me, in this life time, whether I consider myself a success or failure will almost be entirely depended on how I do as a trader. There is no backup plan, you will never forget a job like this, and if you do blow up, you will always wake up in the middle of your sleep wishing that you didn't.

    The IBank route is the road of light, the trading route is the road of darkness, very very very very very few traders can make as much money as a 2 year IBanker with a good degree, and most don't even make it, and at top tier a managing director at a big firm with bonus can easily score seven figures, with none of the stress, none of the risk, while a big time trader will always have to wonder if they will eventually blow up. The IBank represents certainty, reliability, and the potential reward is huge. Think about it, as much as we hate the big institutions, we only wish we have the power of those guys.

    If you have any doubt about your current career, cut your loss, I am doing what I do because 1) I love it 2) I have no other alternative without a degree. Deperation pushes my potential to its maximum, make or break, I will have no regret. That said, if you go 3-4 years into this and decides to pull out, I got bad news for you, there is no life after prop. trading, it will haunt you for the rest of your life thinking how you could have made it like other guys at your firm, any other job you jump into will feel like some crap internship by comparison.

    BTW I had an interview with Tradescape too, I don't think the firm is that great, they rejected me because I didn't have a degree, but the payout was like 25-50% and while they did offer a base salary you have to make it back to get anything beyond that base salary.
  6. liltrdr


    That's good info on Tradescape. I've plugged them at least twice on these boards. I didn't know they had a draw instead of a salary.
    As for your other comments on easy money in Ibanking, forget about that. I know people in Ib. My cousin just got an offer at Chase. He goes in at 8, leaves at 10 (p.m.). First two years consist of grunt work. After two years, you go back and get an MBA. Then you come back and maybe you get to make markets. Now why isn't this low risk/high reward? Just ask the 2000 people who got layed of from CSFB.
    I met a VP at Merrill who bragged about working 100 hour weeks. That's a point of pride to him. Is that normal? As for money, consider taxes and rent in NY. Rent is not cheap! 2K for a studio. Taxes are very high in NY. This means less $in your pocket. No more huge bonuses (for the new guys) anyway now that the boom is over.
    Daytrading is the best choice. It's also looking like the only choice.
  7. Htrader

    Htrader Guest

    Just to add a little more about investment banks, a job as an analyst at an i-bank is far from a dream job. Most banks have an up-or-out policy, which means if you don't get prompted, you leave the firm. Thus only a few make it into the vice president/managing director level where the real money is. Most college grads who start working for ibanks leave for another profession. The best jobs on wall street are often found on the buy-side. If you can get into a hedge fund or a large investment management firm, then consider yourself very fortunate.
  8. Hitman


    I am a trader, and I too live in New York, so tax and rent also applies. The top four field in term of income, FILM (Finance, IT, Legal, Medical) all requires serious commitment (except IT, but then again IT doesn't pay as much as the other 3), anyone who wants to make a few hundred K a year without much effort is day dreaming.

    You should ask your cousin how much he/she makes, with bonus, factor in the benefit / 401K stuff, and he/she makes more than 90% of the people on this board, with ZERO risk. As far as an MBA is concerned, it is a requirement to climb corporate ladders, and you don't need to be a market maker / instititional trader to make serious money, an associate makes low six figures, and I find it funny how people keep on talking "just $1000 a day, or 2 half a point move on 1000 shares will net 250K a year".

    Very very very very few day traders can AVERAGE $1000 a day, when you throw in the summer months, the down days, it is an AWESOME feat in this business, and only the true elite can do it, which a lot of people reading those boards do not understand.

    As I said, there is NO life after a few year's worth of prop. trading, you will never ever be happy again about any other profession you get into, if you are going to bail, bail now, or be prepared for a road of no return.
  9. Hitman


    It is not that difficult to find another analyst position after you get knocked out of the first one. It is not a dream job, but I am being realistic, it is a much better choice for anyone with an elite degree.

    I have a friend who graduated from Cornell (good school) and he started at Deutsche Bank, 60K + 60% bonus + Sign-in Bonus = 100K first year, no risk, long hours, sure, but his chance to pursue a MBA, eventually break into say, associate, is better than anyone trying to make the similar amount of money in day trading.
  10. IB (investment banking) is not easy. I did it for several years with CSFB as an expat. Yeah, I made a lot of money, they gave me a nice home, a limo and a week in the hospital. They work you to death. I worked from 7am to 11pm everyday including weekends but gave it all up when they had me work on Christmas day. 6 months later I was gone. I thought about an MBA too but all it was about is getting connections to a better career; it would do little to better me.

    Since I started daytrading after wandering a few years putting my ego in check, I am no longer interested in what others think about me. They say I'm a gambler and high roller, I say I know what I'm capable of and I can make a good living out of it.

    You have to decide if you want to get an MBA to impress others, or do what you like to do and improve yourself.

    #10     Oct 14, 2001