SERVING THE QUANTITATIVE FINANCE COMMUNITY

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Posts: 1544
Joined: May 19th, 2006, 9:50 am

Do you have a strong heart? Do you have the gambling instinct to take a $13 Billion bank like Barings into Bankruptcy? Can you go to sleep every night with 40:1 Leverage like Lehman Bros, knowing that if the market moves overnight in the wrong direction, you could be completely screwed? Can you keep a cool mind when the margin calls start coming?These questions are more important than the knowledge of Math and Black-Scholes. Last edited by traderjoe1976 on October 22nd, 2010, 10:00 pm, edited 1 time in total. lexington Posts: 321 Joined: November 16th, 2008, 5:04 am ### How can I be a trader? QuoteOriginally posted by: yinaway I really want to know how to break into this field without previous exp. KackToodles Posts: 4100 Joined: August 28th, 2005, 10:46 pm ### How can I be a trader? If I were running a trading desk, I would go and hire fresh kids out of college cheap, and let them go at it, and then winnow out the herd, keeping only the fastest, most hardworking traders who work cheap. Don't overglorify trading and don't imagine all traders get rich quick. For every star trader, there must be 9 grunt traders doing the mundane stuff at disappointing pay. Last edited by KackToodles on October 22nd, 2010, 10:00 pm, edited 1 time in total. GiusCo Posts: 124 Joined: March 26th, 2010, 10:00 pm ### How can I be a trader? I had a telephone chat with a recruiter last month and he asked me why I would not be a trader, if offered to.Well, I'm 37... after 15 years in sports betting, 5 in poker, 3 in financial spread betting, I simply couldn't get in any more. The hours in studying others' effort, the combo plans often hijacked by a late strike, suspect "combined" regular season outcomes, one and another and one more bloody river, tree shakings, emotive reactions on the market, ludicrous statements from rating agencies killing the cat, bullshit and more bullshit hitting the fan regularly. And my ROI, my hourly rate, religiously under the expected statistical level.I had to realize I need to focus on my strengths, let out the gambling rat and call in the ant, the builder in me. So closed all my accounts.The recruiter didn't give a word then put me briskly at rest promising consideration for different roles. Still waiting. ArthurDent Posts: 1166 Joined: July 2nd, 2005, 4:38 pm ### How can I be a trader? QuoteOriginally posted by: KackToodlesIf I were running a trading desk, I would go and hire fresh kids out of college cheap, and let them go at it, and then winnow out the herd, keeping only the fastest, most hardworking traders who work cheap. Don't overglorify trading and don't imagine all traders get rich quick. For every star trader, there must be 9 grunt traders doing the mundane stuff at disappointing pay. Truth! mrmister Posts: 225 Joined: August 15th, 2009, 4:33 pm ### How can I be a trader? QuoteOriginally posted by: GiusCoI had a telephone chat with a recruiter last month and he asked me why I would not be a trader, if offered to.Well, I'm 37... after 15 years in sports betting, 5 in poker, 3 in financial spread betting, I simply couldn't get in any more. The hours in studying others' effort, the combo plans often hijacked by a late strike, suspect "combined" regular season outcomes, one and another and one more bloody river, tree shakings, emotive reactions on the market, ludicrous statements from rating agencies killing the cat, bullshit and more bullshit hitting the fan regularly. And my ROI, my hourly rate, religiously under the expected statistical level.I had to realize I need to focus on my strengths, let out the gambling rat and call in the ant, the builder in me. So closed all my accounts.The recruiter didn't give a word then put me briskly at rest promising consideration for different roles. Still waiting. What do you people think about poker players being successful traders? It is a 9 player zero sum game with fairly simple rules. How does it scale to a massive set of people working with an even larger set of financial instruments with the action space {Buy, Sell, Do nothing}? I have seen some good equity traders with great poker skills but it does not mean much in other asset classes such as mortgages. ArthurDent Posts: 1166 Joined: July 2nd, 2005, 4:38 pm ### How can I be a trader? when to hold, when to raise, when to foldare quite similar to when to buy, how much to buy, when to sellThe 3 questions above are probably in increasing order of importance... Last edited by ArthurDent on October 23rd, 2010, 10:00 pm, edited 1 time in total. lexington Posts: 321 Joined: November 16th, 2008, 5:04 am ### How can I be a trader? QuoteOriginally posted by: KackToodles Don't overglorify trading and don't imagine all traders get rich quick. For every star trader, there must be 9 grunt traders doing the mundane stuff at disappointing pay. this is true for other fields also. how many computer science guys end up like bill gates or like google founders? GiusCo Posts: 124 Joined: March 26th, 2010, 10:00 pm ### How can I be a trader? QuoteOriginally posted by: mrmisterWhat do you people think about poker players being successful traders? It is a 9 player zero sum game with fairly simple rules. How does it scale to a massive set of people working with an even larger set of financial instruments with the action space {Buy, Sell, Do nothing}? I have seen some good equity traders with great poker skills but it does not mean much in other asset classes such as mortgages.I can only compare my experienceonline regular cash game poker at mid stakes level (say$1-2 or \$2-4 blinds, 9-max tables or the more aggressive 6-max tables) forces you to apply a rigid bankroll management and is very very tough, draining, because people actually play for a living ... metagame rules and the field is made of all the same regulars, so variance hits a lot and when you tilt you're pretty sure deadmid level spread betting by using fixed stop loss is less daunting because there is much more playground (it is actually huge, immense, say IG index for example... FX, shares from all over the world, futures, commodities); the experience with rigid bankroll management helps and you decide the timescale of your investment; nevertheless you are not much in control both at short and mid timescales because of so many degree of freedoms to account for, which is why spread betting is considered gambling and poker a skill gamefor what I read here the myth of financial traders relate with cocky youngsters actually gambling / speculating wildly .., and for the huge sums they play it could really be a high level stakes poker game made of very few trading floors battling each other... so probably yes, poker at high stakes helps (and such an experience into a CV would help get rid of many other wannabes)but I still prefer an organized grinder to a gambler
Last edited by GiusCo on October 23rd, 2010, 10:00 pm, edited 1 time in total.

Posts: 1544
Joined: May 19th, 2006, 9:50 am

### How can I be a trader?

Look, if you want to become a trader, you should go to University of Chicago or Wharton and get the MBA degree in Finance. You will not really learn much, but the brand name will get you the job.I can tell you that in one of the PhD seminars, a PhD student asked the prof what is the most best way to identify effective trading strategies. The prof looked puzzled and then said "If I knew the answer to that do you think I would be teaching. Also, do you think I would tell you."

yinaway
Topic Author
Posts: 2
Joined: September 6th, 2008, 8:33 am

### How can I be a trader?

Thanks for all your input, guys! It's really helpful. i really should think seriously about my career.

Gmike2000
Posts: 801
Joined: September 25th, 2003, 9:49 pm

### How can I be a trader?

I think trading is primarily a character thing. In my experience, quants tend to be too risk-averse. After all, the average quant is more on the geeky side of the world and tends not to be the super-confident kind of person. Not saying this is a bad thing, I have always maintained that quanting is the better (risk-adjusted) job.As a trader you need to be able to endure a losing position with your head up and exuding confidence every day, while people talk crap about you behind your back. Some types just cannot deal with the pressure. Character in trading is much more important than university degree.

farmer
Posts: 13462
Joined: December 16th, 2002, 7:09 am

### How can I be a trader?

QuoteOriginally posted by: Gmike2000As a trader you need to be able to endure a losing position with your head up and exuding confidence every day, while people talk crap about you behind your back. Some types just cannot deal with the pressure. Character in trading is much more important than university degree.Confidence and emotion in trading is always described like an arbitrary thing. In my opinion, confidence derives from actually knowing something about what is going on in the market. You can take a really weeny person, and tell him the sky is green not blue. He will laugh it off. Because he knows, he can see the sky himself.In my own trading, I don't even give a fuck if I lose money because I know I can easily make it back another day. I will gamble on anything, who cares if I lose. I may learn something, and I will at least have fun. It is too easy to just make it back on another day.Someone has that quote, in science the most exciting thing is not "a-ha, just as expected," but "hmmm, that was strange." Trading is the same way, there is nothing so fascinating as the unexpected.

spacemonkey
Posts: 443
Joined: August 14th, 2002, 3:17 am

### How can I be a trader?

It have always thought that the relationship between businessmen and traders is basically the same as the relationship between musicians and DJs, which is not entirely dissimilar to the relationship between stage magicians and actual wizards.In a similar vein, being a quant is like writing jingles for radio stations.