It seems as though everyone's a trader these days. What are some of the recruiting methods used by the top prop firms these days? Seems like most of these firms hire anyone with money to burn regardless of experience or educational background. And from the countless advertisements I see on this message board, they don't seem to care who they target. Isn't there any selectivity/weeding out in this industry anymore?
That's my point. Too many "common folk" entering the trading arena only to get smoked and then bad mouth the industry. Oh well, I have no problem taking other people's dumb money. It's just a shame how the profession of "trader" has been so bastardized.
Just a note. In the book "Market Wizards", I believe it was Ed Seyota who said about traders" Many are called and a few are chosen." There is really no way to tell if you are a good trader unless you have some of the basics taught to you and learn as you go. Unless you work as a prop trader for Goldman, Merril or Spear, Leeds with a Salary & bonus, it's going to be tough to make it in this environment. There are probably 10,000 to 20,000 professional traders. Lets assume 10,000(many have left due to this extremely tough environment of this choppy "bear " market. Assume 20% are earning a good living and 5% are superstars. There are probably more professional atheletes(in all sports) than superstar traders. Trading is a very tough to be successful at and a firm will never know who a good trader is until at least a six months to one year learning period and years of practice. We try to "weed" out people who are just gamblers and lose money. True professional traders take trading seriously and treat trading as a "business". A cab driver could become and good trader and a MS in applied math might fail. Trading is part science, part skill and sometimes a little luck. You never know if you will become a good trader until you do it full time. It's very hard to "pre-judge" someone. Gene Weissman Lieber & Weissman Sec., L.L.C. gweissman@stocktrade.net
Ivy, prove it.. prove that education makes a difference.. i have friends with doctorate degrees who made less than me last year.. and i have only a high school diploma.. i have never desired to purchase a commercial education.. if i wanted to, i could at any time.. but what would be the point? i am not trying to impress anyone.. i dont need some degree to be at peace with who i am.. and i dont need a classroom to learn.. did you know that Thomas Edison was kicked out of elementary school for being retarded? and Henry Ford was another "commoner".. but i think it was Einstein who said it best when he advised something to the effect of "not to let ones schooling interfere with his education".. if you do in fact have an advanced degree from an Ivy league school as your handle suggests, then it is a fantastic accomplishment, and you should be very proud.. but take a look at that diploma that hangs on your wall.. that diploma is not you.. education is merely a tool.. passion, perseverance, burning desire, proper mental attitude, ability to get along with others, ability to lead, willingness to take risks, ability to overcome failure, being teachable- those are the building blocks of success.. im not at all against formal education and i dont want to come across that way.. i respect the accomplishments of others who have chosen to go that route.. but to suggest that those of us who have chosen other methods of education should somehow be excluded from trading because of your need to label us as "common" to satisfy your own insecurities is really pathetic.. no offense.. -qwik
many of the fund managers and sales traders are Ivy and they are sheep. Most fund managers can't beat the SP in good years. No offense I admire good breeding and good schooling but you can get into Ivy cause you parents buy it for you (see our prez) and you can also be a LLC prop "traders" on trust fund (and never make a dime)
i'm sorry to have burst your bubble there. you are an aberration from the norm. however, the truth is in the numbers. on average, traders with advanced degrees tend to be better traders. this is a time tested recipe proven to be successful by the most prestigious firms on wall street (gs, jp, merrill) as well as the firm i work at. of course the occassional high school dropout "superstar" story arises, but they happen very rarely. i've worked on a trading desk at merrill for 3 years before trading on my own. all 19 traders came from top 10 schools. the firm i currently work at gives special commission/payout/training deals to top school graduates. they don't offer these deals to anyone else because they realize the likelihood of the person to be successful is historically lower. i'm not saying an advanced degree automatically makes you a great trader. however, top firms realize that traders possessing such degrees are capable of handling far more challenges than the guy who never went to school. i've seen the turnover rate at my firm and have noticed that most of the traders who most often come and go do not come from very good colleges (if any college at all). it's just a shame when these people claiming to be "traders" start bitching and making the profession look bad in the public eye. not to mention, these same "traders" are responsible for the bulk of the firm's losses.
I don't think you can make a judgement on education alone. I've seen many traders on both sides of the fence - heavily educated (formal) and little formal education. Both do well, and both fail miserably. First, I think that people that have it drilled into them that they MUST be right (ie doctors) and that failure is not an option, tend to do the worst. These are the ones that will hold onto a loser, refusing to admit that they made a mistake. I've seen people with multiple advanced degrees do well by following a very structured approach (ie computerized trading), but fail in a more discretionary approach. I've also seen guys come in from working minimum wage jobs with only a high-school education making six figures in six months with a little one-to-one training and using a discretionary approach. However, I believe trading-specific education or mentoring is very helpful.
The responsible proprietary firms screen out traders based on their historical performance. We will often not accept a new trader who has been "around the block" a few times with other firms. There is always a "story" about why they have so many problems. With the licensing requirements involved, bringing in new people is a much better process (as opposed to the old days when anyone could trade...ala the "SOES" firms, who have mostly gone the way of the buggy whips and 8 tracks). We encourage all potential traders to come for trader orientation and training prior to making a life-changing career move. Trading is not for everyone, and we all know that are only a small number of us in the entire country. If someone is motivated and willing to accept the fact that this is a career, and not "let's try selling real estate on the weekends" type of thing, then we are willing to work with them. So many new people are led astray by promises of success that simply are not borne out by most. We have maintained a very high success rate compared to the overall industry by doing our best to keep our traders moving forward with techniques and strategies. This is an ever-changing game, and we would like to stay in the lead...and the only way to do that is by keeping our traders doing well. Psychological makeup has a lot to do with our overall screening process as well. We don't want "shooters" (especially those with OPM).