Need Some Direction

[EvanMcM]

First time posting on this site, although I've been reading a bit over here. Spend quite a bit more time on one of the other big finance sites, although it's heavily IB-focused over there so I feel I might get a bit more advice over here. Sorry for the length.

I'm a student about to graduate from a very small liberal arts college with a finance degree. If I had known that the absolute worst degree to get in order to break into either S&T or prop trading was finance I would have switched to Econ or math (or even physics) early on. But, it's too late for that.

I am trying to figure out what the best course of action might be in order to put myself in a position to break into the industry. I know occasionally we all know the story of the guy who cold-called some MD whose number he scraped off the sidewalk every day until he got a job, but to put it in statistical terms, that's like a 2 or 3 sigma event. It's not something you can count on at all.

I have a complete list of about every finance firm in the city, and am planning to either cold call or cold email or try to make a contact at every firm I can until I network myself into something. In addition, I have a couple conversations going right now that might turn out to be helpful. I am not counting on that however.

Short of networking my way into S&T, my next idea was to attempt to get into a mid-tier prop shop. I am doing quite a bit of self-study in regards to financial engineering and derivatives, and have that on my resume. In addition I trade a paper account with TDA and have also managed money in the past (and did well). Figured it can't hurt. I know that many of those interviews are comprised heavily of brain-teasers and mental math, so I've been practicing those things as well. However, once again, not sure they'd even give my resume a second look with no experience and a finance degree from a no-name school. Not going to let that get me down, but it is in the back of my head most definitely.

Finally, something new has come up and this is what has forced me to really try to think about what I should do here. I have a good friend inside a BB in PWM and has basically recommend me for a job there. They give you a pre-existing book of high-net-worth clients whose accounts have been orphaned, and you just have to basically hold their hands. I feel that I should be able to take advantage of this no problem, as I also have quite a bit of general work experience dealing with people, cold-calling, relationship-building, etc. I'm very good on the phone and with people.

So, right now I am heavily tempted to go after that position just to get to the city and get inside the firm. First, I could start to snake my way through the company and perhaps make some headway trying to network within the organization itself. Second, might meet some very interesting clients and perhaps make some connections that way. Third, I'll be in the city and networking would be much, much easier than at home in WI.

Finally, with a job that isn't really too demanding, I could try to position myself for an MF or MFE program which something I'd really like to do.

So, ultimately my questions are - is PWM going to be a black mark on my resume? Am I going to kneecap myself going forward by "selling out" and doing that? Secondly, realistically what are the chances of someone like me even getting an interview at a decent (salaried) prop shop or, say, a boutique/MM IB firm's S&T operation? Thirdly, is an MF going to be limiting vs. an MFE? I've gotten many answers on this. My goal is definitely trader and not back-office quant. Finally, I always hear about how guys in S&T are more impressed by drive and motivation as well as raw potential as compared to pedigree. However I'm not sure I believe this. How true is that? How much of a shot do I really have?

Thanks so much. So sorry for the length, just wanted to make sure I painted the whole picture.

 

[Fer Carranza]

Hey Evan,

I work in wealth managament, and have been studying at night. Calculus 1,2,3, C++, Linear Algebra, Differential Equations so far to gain the basic knowledge needed for an MFE.

The truth about wealth management is that you will only learn by going to a good group with people that know more than you do and that are willing to teach you. A lot of 'financial advisors' are really just people with good communication skills who borrow ideas or just go with what's on the news and that's it. I see it all the time.
In a year and two months, of my acquired knowlege, 5% I learned here and 95% outside. This doesn't mean it's going to happen to you, but it could so you have to know where you are going and what you can do.

Regarding trading, the non-HFT, stat arb, math based trades are done by people with MBAs who look at fundamentals, call companies, etc, and then determine whether the company is undervalued/overvalued. For example: Bill Ackman going short Herbalife because he thinks it's a pyramid scheme.

Also, I have a friend who is a flow trader at the wealth management side. He just manages big orders as he works for ultra high net worth clients and has to manage very big orders. We also have a bond desk for wealth management that I'm constantly in contact with to get prices on bonds for clients.

So there are options, but I feel by 'trader' you mean more of proprietary trading, making your choices and getting a share of the P&L, in which case you'd probably be better off looking at prop shops.

 

[JulianT]

I would tell you to run with private wealth and upgrade your skills as you see fit. It can be a very lucrative field, and I would argue that compensation by unit of stress is much greater than that on a sales desk, let alone a trading desk. As Fer mentioned, many a broker are barely financially literate, there is a subsection which are very successful, and better than many an institutional money managers. You just need to find the right mentors, and continue to expand your horizons.

Your fear that PWM would be a black mark is completely unfounded, as through your experience, you will meet and network with very successful people outside the world of finance (your clients), and potentially the very same hedge fund managers you might want to work for, if you are looking at an investment in their funds.