Hi everyone, I am a recent college grad about to enter the trading industry. I will have to decide which of the following 3 roles would be best for me, and any help would be appreciated. 1) I have been offered a job as a trading assistant on the exchange floor in Chicago. The salary is rather low (35k) but the training period is 12 months with 10-12 hour workdays after which they expect me to graduate to trader (not a sure thing). What are future earning expectations if I do reach trader status and am moderately successful? Any other aspects of a career as a floor trader would be helpful as well. 2) I have been offered a paid internship at a derivative market-making firm with the opportunity to graduate to a junior trader after 6 months (not a sure thing). Think along the lines of a company similar to Optiver with low-latency computer software. I'd be making 2-3 times as much doing this than as a floor trading assistant. 3) I have a final interview with Chopper Trading coming up, which is computerized trading and would seem to offer decent pay and a bonus with a good work-life balance. I'm mainly looking at choosing between options 1 and 2 since option 3 may never happen. I'm still torn between turning down a full-time job (option 1) for an internship (option 2), but I suppose they both are similar b/c if I can't make the cut I'll be out of a job in both within a year. Which of these options would likely lead to higher lifetime earnings, and am I correct in assuming a job on the trading floor would be more stressful? Option 1 as a floor trader is a sure-thing right now but I don't want to be putting in 12-hour work days making little money for the next 5 years, when if I accept the internship I'll give myself a chance at making 6 figures with a nice work-life balance. My only concern is that trading on the floor can be heavily romanticized and it flat out sounds real cool too, but I want to make sure it's also the best path to take. I know a lot of trading has shifted to computers and away from the floor in recent years, and companies are only doing that if they thought trading on computers would be more profitable. Basically my dilemma is either awesome experience running on the floor making less........or staring at a computer but possibly making 2-3x as much. Any insight into a career choice would be immensely appreciated. I'm a bit confused about how a career as a floor trader works as well so if anyone can shed light there it'd be helpful. Thank you.
IMO your answer lies in this statement -- which do YOU want? Assuming you are young, then either option sounds like a great starting point. You'll get some saying that floor experience cannot be duplicated and others will say the floor is dead so why bother. If it's purely about $ then sounds like #2 is the choice. If it's about the 'experience' then #1 will be hard to replicate sitting in front of a computer all day. What's the best long-term? Really hard to say since either option could lead you to a profitable path at some point. And both options could lead to looking for new work in 12 months.
Man, thats a tough one. Option 1 would be a great experience but how relevant will floor traders be in 10 or 20 yrs. In addition working the floor is very tough. My aunt is a Paramedic and was stationed at the CBOT and had to deal with traders passing out or heart attcks due to the stress. I think Option2 would be my choice. 6months training, 2-3 times more pay. If your end game is to trade for yourself eventually Option2 would build your capital faster. Good luck with your career.
For the love of God get that damn job at Chopper. That is one of THE premiere trading firms in Chicago with practically ZERO turnover rate among employees. The partners make well into the 7 figures. The floor is dead and quite frankly market making is dominated by one or two firms. Do what you have to do to get the Chopper job.
Great input. Thanks guys. Ultimately I want what everyone else wants....decent pay and a solid work-life balance. But don't kid yourself as I'm ready to put in the hard work and long hours my first few years as a down payment. Just trying to look long term here with my question. The whole "floor trading is dying" thing concerns me as well. I don't want my pit becoming electronic in a few years and my livelihood disappears overnight. They just closed the Pork Belly pit a few weeks ago. Also, my strength lies in numbers and quick decisions perhaps more suitable for computer trading....it seems a lot more intangibles are involved in floor trading. Not gonna lie, being a young 20-something in a pit competing against 50 yr old men sounds like an uphill battle. Plus it seems if the computer trading doesn't work out at least their might be more skills I'll make sure to nail that Chopper interview best I can. Appreciate the responses guys.
10 or 20 years ? Floor traders have not been relevant for a couple years now. Other than certain options market-making activities, there is no relevant floor trading. PS: just look at the open outcry vs. electronic volume percentages - it's published daily by the exchange on their website.
They all look similar to me. 35/yr is really nothing so think of it like an internship. If the floor group is doing options then its good; something like upstairs/floor combo doing ES/SPX/VIX/SPY/etc. Anyway, you shouldnt be focused on salary which is crap even if they pay you 100k...this is USD right?
Sell your time to the highest bidder. Keep the other bidders bidding in case you need a way out if you don't like the highest bidder after 3 months or something.
I'd definitely go after the Chopper job with some heat. If there's some time pressure on the first two options, you should (politely and professionally) let Chopper know. Ask if they can expedite their decision making with your interview and hiring process. Between the two offers in hand.... no doubt, the derivatives firm. As bone said, the floor is irrelevant. Anyone left on the floor these days would gladly latch onto a respectable/profitable way out. Existing pits are dying off, and up/coming exchanges like ICE dont even have a floor. And keep in mind no firm offers you an internship out of boredom, they're investing time and money in you because they see potential in you.
They (the industry) give people internships because they need obedient people who will do bitch work, like getting coffee, or making sure the clearing records match up. There's no guarantee of success. The general rule of thumb (70% of the time) is that in Chicago prop firms, you need to figure out which group inside the company you are joining. Some groups are well established, others are more so-so. You don't want to join a group that is already super established because the partners will carve up the profits at the top and leave you with some scraps. There's rumors about every prop firm in this town, and most of the rumors are hype. Figure out how many people are in the group, that's one indicator, and two, figure out what the education level of the people in the group is, and three, find out how long they've been there.