How do I break into trading at a bank, hedge fund, or asset management firm?

[mastertrader]

I have 2 years experience as an equities proprietary trader where I put up my own capital and am finishing up my MS Mathematics. I recently got accepted to UCLA's MFE program, but I really want to break into trading and I'm still deciding if the program is right for me. It's trading or bust to me and I really have no interest in any other area of finance. Thank you.

 

[MRoss]

S&T divisions in major banks don't care about MS degrees, only about work experience. Sure, going to a summer program as a master student makes you an associate but that is more of a "keeping up with the Joneses" thing; the managers really don't care about the fancy degrees.

You have excellent entry level trading experience. What you need is a strong network, not another degree. Talk to anyone you know in a major bank. Ask them to put you in touch with traders within the bank. If they don't know any then ask them to ask other people within the bank if they know any traders. Yeah, this actually works. If a trader likes you enough and you've gotten to know each other a bit, ask him to introduce you to his manager.

Basically, network your brains out. You'll be fine.

 

[financeguy]

I sort of disagree with that entirely. Although mastertrader has experience prop trading a stock portfolio, it's hard to imagine all the skills he acquired in that job being directly transferable to a big sell side trading desk. I think it would be a bit tricky to parlay this background into an actual trading job even if he successfully pulled off the networking feat of the year of getting in front of a desk head in a formal interview in the current environment. Further, from my own experience having worked as a trader at bulge bracket banks and knowing dozens of traders at all levels around the market, a lot of trading desks do absolutely value quantitative graduate degrees. I have one myself.

The best bet in my opinion is to use your school's career center to get interviews for jobs that actually exist right here and now. That's how I got my first job and that's the strategy that has the highest probability of you landing one. If there are absolutely zero trading desks interviewing candidates at your school, then that's a bit tricky honestly. Obviously you should network as best you can, but if you're starting from a position in which you don't know anyone well who works in or around the sort of job you want, then again that's a steep uphill battle. If you can't get an interview at the school from which you're getting your MS degree now, and you don't know anybody at all, then getting an MFE might be the best option in terms of what will most likely land you a job. That said, there's a very non-zero probability that you pay for the MFE, work 1-2 years for the degree, and don't end up with the job you want. That's always a caveat and it's a very real risk. But if it's trading or bust and you're busting on your current school's career center and you're busting on networking potential, then you may as well go all in and pony up for the MFE degree. Just make sure you choose the right MFE program that you feel will give you the best chance of landing the job you want. Don't just go to any MFE program, pick the right one. There are loads of postings around these forums that can help you form an opinion on that.

 

[mastertrader]

I sort of disagree with that entirely. Although mastertrader has experience prop trading a stock portfolio, it's hard to imagine all the skills he acquired in that job being directly transferable to a big sell side trading desk. I think it would be a bit tricky to parlay this background into an actual trading job even if he successfully pulled off the networking feat of the year of getting in front of a desk head in a formal interview in the current environment. Further, from my own experience having worked as a trader at bulge bracket banks and knowing dozens of traders at all levels around the market, a lot of trading desks do absolutely value quantitative graduate degrees. I have one myself.

The best bet in my opinion is to use your school's career center to get interviews for jobs that actually exist right here and now. That's how I got my first job and that's the strategy that has the highest probability of you landing one. If there are absolutely zero trading desks interviewing candidates at your school, then that's a bit tricky honestly. Obviously you should network as best you can, but if you're starting from a position in which you don't know anyone well who works in or around the sort of job you want, then again that's a steep uphill battle. If you can't get an interview at the school from which you're getting your MS degree now, and you don't know anybody at all, then getting an MFE might be the best option in terms of what will most likely land you a job. That said, there's a very non-zero probability that you pay for the MFE, work 1-2 years for the degree, and don't end up with the job you want. That's always a caveat and it's a very real risk. But if it's trading or bust and you're busting on your current school's career center and you're busting on networking potential, then you may as well go all in and pony up for the MFE degree. Just make sure you choose the right MFE program that you feel will give you the best chance of landing the job you want. Don't just go to any MFE program, pick the right one. There are loads of postings around these forums that can help you form an opinion on that.

Thank you very much for this very informative reply. Yes, UCLA has placed traders in the past, but it's it's definitely not the best for that. I will have to improve my GRE scores (790Q/450V/4.0AWA) to get into a top program, but getting into a program that has an internship is important to me. Looking at the top 10 programs according to this site that leaves 5 programs: CMU, Princeton, Columbia MSFE, Berkeley, and NYU. Cornell seems to have too many prerequisites and it's hard to imagine everybody has all of them. MIT and Columbia MAFN have no internships as they are only 1 year programs. Ranked outside of the top 10, Chicago might be worthwhile, but I don't know if it's placing people into banks or the numerous high turnover low salary prop firms that are out there.

 

[financeguy]

Thank you very much for this very informative reply. Yes, UCLA has placed traders in the past, but it's it's definitely not the best for that. I will have to improve my GRE scores (790Q/450V/4.0AWA) to get into a top program, but getting into a program that has an internship is important to me. Looking at the top 10 programs according to this site that leaves 5 programs: CMU, Princeton, Columbia MSFE, Berkeley, and NYU. Cornell seems to have too many prerequisites and it's hard to imagine everybody has all of them. MIT and Columbia MAFN have no internships as they are only 1 year programs. Ranked outside of the top 10, Chicago might be worthwhile, but I don't know if it's placing people into banks or the numerous high turnover low salary prop firms that are out there.

CMU, Princeton, Columbia MSFE, Berkeley, and NYU are all great schools - and I agree an internship is a great idea. As for which schools have the highest hit ratios for bulge bracket investment bank or hedge fund trading jobs (not prop shops) specifically, hopefully someone else can chime in; I don't have that information.

 

[mastertrader]

I basically have until Monday to decide unless I want to eat $2600 by taking their pre-program courses. There's also a $2000 non-refundable deposit. I don't know how I stack up at the top programs:
CMU MSCF, Columbia MSFE, Columbia MFAN, UCB MFE, Princeton MFIN, MIT MFIN, Cornell CFEM, NYU MMF

My full background:
GRE: 790Q/450V/4.0AWA
MS Mathematics Fairfield University: 3.96 GPA
BA Economics University of Connecticut: 3.64 GPA (Honors Scholar)
Work Experience: Arcade Prop Trader (2 years)
Programming: VBA in Mathematics of Financial Derivatives course, Mathworks Matlab Fundamentals course, R & SQL used in online certificate for Sabermetrics through Boston University

I look at some of the people who got rejected from these program and I don't think I stack up. I can improve my GRE scores if I study and add to my programming skills, but I can't do anything about my lack of quality work experience. My schools also aren't of the same selectivity as many others applying to these top programs.

 

[SadKillarrious]

Master,

Have you just not been able to find decent work or internships? No doubt you seem like you know your shit when it comes to maths. I think your should listen to MRoss though. Certainly going through with the MFE would allow you to tap another network and make you a better quant, but at what cost? I know you said its trading or bust as far as the finance field, but maybe instead of sinking more money you should look at other options out there for ya. After looking at the UCLA MFE course descriptions, it looks like a portion of it is topics you probably covered in your BA. Just my opinion though. Have you thought about a PhD? It seems you enjoy academics.

 

[mastertrader]

Master,

Have you just not been able to find decent work or internships? No doubt you seem like you know your shit when it comes to maths. I think your should listen to MRoss though. Certainly going through with the MFE would allow you to tap another network and make you a better quant, but at what cost? I know you said its trading or bust as far as the finance field, but maybe instead of sinking more money you should look at other options out there for ya. After looking at the UCLA MFE course descriptions, it looks like a portion of it is topics you probably covered in your BA. Just my opinion though. Have you thought about a PhD? It seems you enjoy academics.

My problem is that I haven't been able to find decent work/internships. Academia doesn't really interest me. I've covered some of the coursework in the curriculum, but not most of it. The idea of going for the MFE is to learn more about other products (ie: derivatives, fixed income, credit markets) with the goal of getting an internship and hopefully a full time job on a trading desk (sell side or buy side). A PhD seems like a complete waste of time to me. I like learning applications more than theory. The whole point of going to UCLA is really to gain the skills needed to get an entry level position.

 

[StevenChen]

I do not think course can tell you how to trade.

 

[mastertrader]

I do not think course can tell you how to trade.

Of course not. I'm looking to utilize the recruitment and knowledge from courses/career services I get from the program to land a position at a bank or hedge fund. Ideally I'd get a position right now, but I'm not competitive and need to strengthen myself someway. I don't have a strong internal network and I've used networking to the best of my ability thus far to get nowhere. I have to expand my network in order to get a position that way.