I used Twitter to compile advice for people trying to get into the quant/derivatives world:
There is much resonant advice, I had to re-factor it to make this evergreen. As an assurance, even though some of these accounts are anonymous, they are professionals.
Before the details let's see the common themes.
Everyone Agrees These Are Important
- Emphasis on aptitude (often proxied by pedigree) & teachability over direct market knowledge Although if you lack any market knowledge you might struggle convincing an interviewer on the next point...
- A genuine interest: The game is hard, you will need persistence and interest to carry you through the inevitable difficulties. You should be able to demonstrate this.
- Skills. In today's marketplace you must have technical skills. Math and coding. While that's a common theme below, I'll give 2 additional reasons for needing these skills. The first, is as an assistant, the more useful you can be to your bosses the faster you'll progress. Training apprentices is expensive in time and money. It's not great if you have to spend company time learning broad skills. You put yourself at a disadvantage. Secondly, skills allow you to self-start. You can prototype and test. If you need to rely on a dev or quant to study hypothesis that are probably wrong in the first place, you are dead in the water. You need to be able to build yourself so you can iterate through ideas faster.
Without further ado, here's outstanding advice from these generous and seasoned pros...
The Pros Weigh In
This thread is something that is near and dear to my heart. It will solely be based on the never ending question that I receive. "How do I become a trader". Disclaimer: This will solely be based on MY experience and what worked for ME as a vol trader. I hope you enjoy!
- Kris demonstrated that alternative paths to Wall St are possible
- My path to Wall Street was extremely weird. I thank God everyday because I truly was not supposed to be here. I was just a kid from the hood that enjoyed math and gambling (just being honest).
His full path is documented in his interview with Corey Hoffstein
- A hard truth: pedigree matters
- College and major is important Before I got accepted into Penn to finish my masters, I completed my undergrad in accounting at a small non target on Long Island (LIU). I know people will tell you, that " a degree is a degree" but that is the furthest thing from the truth. Wall Street cares about pedigree and if you can get into a good program it is a huge leg up. The good shops on Wall Street will come to the top schools to recruit, and it increases your chances of getting picked up exponentially. Recruiters and HR people look for this a lot. Although I was passionate and skilled, I had a rough time getting an interview because of the "non target" label. It made things worse when they saw I was an accounting major. This is going to hurt some feelings, but the truth must be told.
- What to study
- Finance, accounting, MBA,....all no longer hold weight when looking for a trading job in today's market. Comp science/ stats/ math background, will be preferred when it comes to a TRADING job. (not the same for Investment banking). If you are looking for a TRADING job, you HAVE to learn how to code! You do not need to be a full programmer but you have to be able to do the bare minimum. Connect to a data source, pull the data, parse/ clean data, analyze data, implement data visualization. I had to teach myself this. I am a bleh coder, my code will anger any real programmer. But it is good enough to be able to function as a vol trader. Most traders on the sell side have poor coding skills, take some Python courses and do a few projects with it. I had to teach myself the advanced math. You will not be expected to understand how to use chaos theory to find pockets of stress that can lead to 4 sigma dislocations in asset prices. But you will need to understand what a bell curve is, Z score, dynamical systems etc Just take a couple college stats courses and you will be fine. You will learn the rest of the stuff on the job. Half the Exotic vol traders on the street can't even name three inputs in the pricing model....(this is not hyperbole).
- What passion looks like
- No, not that fake passion bullsh*t. I am talking about genuine real obsessive interest in this field. This is the factor that made the difference for me. I never needed to fake the passion. I fell in love with the game immediately and although I sucked, I just refused to give up. I was working at Walmart full time, going to school full time, and trying to trade full time (crazy I know lol). As loserish as this seems, I never attended one college party at LIU (right hand up, swear to God). Most of my free time was spent reading trading books or in the finance room where there were Bloomberg terminals. I just wanted to soak in as much as I possibly could. Deep down in my heart I felt like I understood markets better than a kid who was at Wharton. He could restate p/e ratios but couldn't tell you what a T1 trading halt was or how markets worked. I knew those bc I was obsessed. I wanted it so badly I refused to take no for an answer. I got rejected by so many firms but I just kept trying to network my butt off. After a million tries, an ex CBOE Vol veteran gave me a shot. I pitched him over the phone and after a few interviews he made me his junior trader. I used to drive an hour each way to the Hamptons just so I could learn the game from this guy. If you are passionate about this game, you will be relentless, and the business will find its way to you. You can't fake passion, you will know if you want this or if it is just another "job". Just be persistent in your approach.
- Learnability & adaptability
- If you want to be a trader you have to be understanding that you will have to function on the fly. This means that there will be times where you will have to do things that make you extremely uncomfortable under stressful moments. When it boils down to it, you have to be water and flow with what the market is telling you. Your ability to learn from your peers & the rest of the street is crucial to your success. Some of the best learning lessons I had was by watching what NOT TO DO. If you go in there with the mentality that you are smarter than everyone else, the market will humble you. Trust me, it happened to me. I laughed and looked down at older PMs & MDs that couldn't open an excel sheet. There were times I faded their expertise and I paid for it. Listen, learn and be humble in your approach. Learn from other people's mistakes and stay close to the ones that are good.
- You may have the best gift in the world, but if the wrapping isn't nice, it wont be the first gift that is opened. You HAVE to learn how to articulate your point across to each interviewer. This means you MUST emphasize why you belong here. That means emphasizing: Skillset- I can code & do math (highlight resume) Market Passion - I want this so badly because Market knowledge - What I understand about the asset and how its traded Learnability- Im excited to learn about XYZ Likeability- (Express genuineness)
A few people have approached me asking how best to get a job in trading/finance, is this worth a thread with my advice? the caveat is that i lucked into everything and do not know anything...this is mostly about my experience in the prop/quant job market:
- Importance of hard skills
- Mostly gone are the days of calling your guy at GS to settle today else you get margin called or something, it now seems to me mostly to be a test of technical skill/ability to learn. To that point, many firms (mine *usually* included), won't hire experienced traders bc its usually easier to teach a nerd to trade than it is to teach a trader PDEs or something, and this is due to our favorite four letter word: Math! imo, mathematical literacy/competency is the single most important skill one can have trying to enter the extremely low-stakes world of picking off retail orders. it's not necessary to have a phd, but you should have the ability to look at some terrible regressions and understand why they suck, and how to make them better. this is, to me, more important than our next point, which is programming skills/comfort. Its passe, but learn to code. familiarity with python/sql alone can get you a long way if you want to stare at (or even make) your own bad regressions, and it's just good advice since everyone's job is on the computer.
- Always remember this fun step: 1) NO ONE* cares about your retail trading track record. this may not be true if youre like a turbo genius or have actual alpha but i have never even seen a resume where someone mentions their personal trading other than to color their technical exp. My experience was: i previously had a job writing CRUD apps at a smaller firm but it was a nice place to learn and i had built up some decent experience on decently sized systems, also i had put some code into prod which is the whole point. YMMV on this i was very lucky. So, we get to the interview. you've passed your phone screen and convinced HR and one (1) dev you're not a fraud or a serial killer. this is the part that sucks the most but is by far the most gameable:
- Be good at systems design and small interview questions. it's stupid, and not really applicable to the job, but grind out a zillion leetscode until you're comfy you can recursively find a DFS cycle in a linked red black tree or something idk
- 1a) to stress the systems thing, we often ask people to design a toy order book, or something like that. read this, get good at it, etc. ex: https://github.com/donnemartin/system-design-primer
- Do not try to pretend you know more than you do. it's painfully obvious when someone is repeating something they don't understand, and if an interviewer keeps drilling down into the "why's" of your answer, you should be able to give them
- You don't need to be a data scientist, but you should understand why modeling covid infections with a cubic made people angry
- Oft overlooked: get a hobby! the joke is that you should put two interests on your resume, one exercise related and one job related, but it kind of rings true. being able to talk about something you're passionate about is nice
- Twitter is a great tool for networking, and as @kchoudhu mentioned, being nice is a really good way to make friends.
- Everyone fails at things! i was walked out of a jane street conference room without an offer (and it wasn't the only place that's happened to me), but it's important to not give up! interviewing is a skill that needs to be honed.
- Things to NOT do in an interview
- Do not ask the final interviewer if the woman you interviewed with right before that (me) was a "diversity hire", especially when you cant find a good solution to the algo question.
- the interview will be roughly 9 hours onsite. do not leave earlier than this mid-process because you "were only told it would be 8 hours" and it ran long. not good.
- do not tell the interviewer you wrote a large parser generator with ANTLR on your resume and not be able to tell me what an LL(k) parser is
I often get DMs asking for career advice from students interested in quantitative finance. Here are a few thoughts...
- Why you should go into the field. And why you shouldn't.
- Go into the field because you think the subject matter is interesting and fits your skill set. The heyday of public markets finance as a growing field is over. You will not get rich quick; you will advance slower in seniority; you will envy the $ in private equity and tech.
- The trajectory.
- Most people start out at larger firms with on-campus recruiting and rotational training programs. Major banks and asset managers, and a few of the larger hedge funds. Smaller firms look to hire people from larger firms because they don't have the bandwidth for basic training.
- As with many fields these days, even if you don't fancy being a back-end developer, the best educational background for many finance seats tends to be technical. Engineering, statistics, applied math and programming skills are increasingly important. Economics was so 1980s.
- ...views on this differ. I would tend to say your time will be better spent developing better broad-based technical skills and working on some relevant applied projects or internships in finance..
- Navigating a small firm
- Smaller firms recruit primarily through networks. So when you're a junior at a large firm, its helpful to meet as many people as you can within the firm, get external exposure to clients or coverage where possible, and over time build up a set of contacts that can help you.
- Focus on technical abilities and showing interest in markets
- "display an understanding of how you'd tackle problems"
Joel's book Trader Construction Kit has a chapter How To Get A Trading Job. Joel was kind enough to provide a free pdf of the 18 page chapter...
How To Get A Trading Job
1. How to prepare for a trading interview.
2. Resources for development.
3. Choosing a market.
4. Surviving the first days on the desk.
5. Transitioning to the desk from another area of the firm.
Aaron has a book devoted to this, Wall Street Job Primer: A Comprehensive Guide for Those Aspiring to Work in Financial Services, and also offered some wisdom...
- On the importance of internships:
- top priority: internships. Whether you have to beg, borrow, or steal, internships are key. Not to mention, bar is lower for hiring as managers see them as 2-3mo interviews.
- What to demonstrate at a junior level
- Aptitude > knowledge at junior level but one's desire to work is a plus. So awareness of core and/or cutting edge research might help clinch any runoffs.
- Another thing I always liked to see was experience with a project that involved data/analysis. There's a big gap between theory and practice. So proving you can roll up your sleeves in a real or semi-real world situation can be helpful too.
- Proper career hygeine that applies beyond finance
- General stuff: Networking. Plan ahead. Persistence/followup but not harassment (e.g., handwritten thank you letter after interview). Stand out (e.g., I used to print resumes on pink+blue paper just bigger than A4). Pick brains. Make contacts. If I think of more, I'll add here.
Founder of a trading firm (offline contact)
Advice targeted to quant research/quant trading.
To stress what others have said: altitude, attitude, attitude - some concrete examples:
Some firms will continue to ask you questions until you reach one you can't answer. Top firms are staffed with former IMO medallists and Putnam high achievers, they will have a question you can't do. They're testing how you react to the stress - especially for the quant trader role. If you melt it will beg the question, what will happen if the market throws something unexpected at you.
If it's on your resume it's fair game, especially for quant roles. Assume there is an expert at the firm in anything you put down and do not exaggerate or lie about technical expertise. If you're an undergrad and used a python package for PCA once, don't put down PCA unless you're comfortable being asked the mathematical details (the eigenwhat? A very bad response). Similarly for machine learning, especially for machine learning nowadays.
n.b. on the above, can't find it to credit it, but saw a great tweet from someone where they said as soon as they see lots of ML on a resume, they are going to ask for the matrix form of OLS, if the person writes it down they'll ask for the derivation. A good quant researcher would be able to do it multiple ways, and on the topic, know the assumptions of linear regression.
Be open to other roles. The industry is opaque and you might think you're born to be a trader, but in actuality you'd be a much better quant developer or quant researcher. Interviewers might spot this, especially on the trading side, if you're contacted about a switch in the process, it's likely the same pattern recognition that makes them good traders makes them correct here.
The resume thing extends to poker for trading roles. Everybody puts it down, if you feel you need to do it please, for your sake put (beginner) or (intermediate) next to it to denote your experience, you may interview with an ex-pro.
Similarly if you say you follow markets, please follow markets. Don't just know where the S&P 500 closed or the ~ price of oil. At least read a few articles on the market headlines. For example Oct 2021 inflation questions & supply chain issues. Don't act like an expert, but try to have something informed to say.
If you want to be a trader, find an opportunity to gamble before the interviews. It doesn't need to be your life savings, please don't make it your life savings. A few dollars playing poker with friends, or betting $1/ game against the Vegas line with somebody 5 games a week on the NFL, whatever.
For quant traders mathematical brain teasers are a big part of the process. It's self selection, quant anything tend to enjoy recreational mathematics. They'll give each other those questions for fun at work. Traditional trading roles at the big shops that hire for them will be more focused on game playing, again self selecting.
Bonus point for when you start your role and for interviews. The one unforgivable trait in trading and research. Inattention to detail. If you f**k up the little things, who is going to trust you with the big things? Don't rush your answers, take an extra second to get it right.
Similarly have humility, these firms are staffed with the best and brightest, you may be used to being top of your class, but everybody around you is too and on the markets/trading side you're being tested on something new to all of you. You may not be the best anymore, but that's where attitude, persistence and attention to detail pay off.
Finally, and,I have no idea how to practice this, but practicality. Interviewers are looking for people who can solve practical problems, not just intellectual horsepower. Good employees are good at solving structured and well defined problems, great employees are good at solving unstructured but well defined problems, exceptional employees are good at solving problems that aren't initially well defined - i.e. they help define the problem. Interviewers are looking for this. It goes by many names, practicality, entrepreneurial spirit, initiative. Find a way to show it.
While the next advice did not come from the original trading-oriented thread, it remains a collection of tips that apply broadly to interviewing in general so I must include it.
here is a big thread of career advice for people under 30
- What to do in an interview
- Walk tall, stand up straight, and exude confidence
- Self-assurance signal: when you walk into the room, before you sit down, move the chair slightly to position it exactly how you want
- If your hands are shaking, relax them in your lap
- Bring 2 copies of your resume. Have your resume memorized; don’t look at it while you’re talking
- Have a story for resume gaps or job losses. Relax about them—they are not necessarily disqualifying—but have a story, be ready to explain
- Use visualization before the interview: imagine yourself answering questions smoothly, the interviewer nodding, and the feeling of rapport
- Smile at the beginning and end of the interview to show that you’re relaxed & friendly...When they signal that the meeting is over, make a complimentary comment on the business like “I admire what you’re doing here and would love to be part of the team”
- At the end of the interview, don’t just say “thank you”, ask for the job—make your final one-sentence pitch. They'll retain the last thing you say
- Show authentic interest in the job. Before the interview, think of three reasons why you really want this job.
- If you’re serious about the work, read books related to the field and do research about people in the field, and have some book titles and anecdotes in your back pocket for interviews
- Have examples ready of how you did the tasks of this job already.
- State how you personally would add value to the business. Help the interviewer understand that you would make their life easier, not be a burden and not expecting them to hold your hand and walk you through things.
- Prepare some thoughtful questions that are not answered by the firm’s website. For example: “what would be your expectations for the person you hire to be successful in their first 90 days in the role?”
- When they ask "do you have any questions for me", do not take out a sheet of paper with a dozen invasive questions written on it like "what are the names of your biggest clients"... ask a few solid questions that show how thoughtful you are. You're still on stage
- Prepare stories that illustrate your talents. And show some energy and vitality in the interview. I have seen people lose opportunities because somebody with hiring responsibility thinks they have no personality
- Be ready to talk about non-work things you’re interested in; don’t appear boring
- Get a book of interview questions from the library or search online for a list of interview questions. Prepare answers to common questions. Write down (or type up) your answers. Then get a friend or parent to help you practice answering them.
- What NOT to do in an interview
- You’re not allowed to “pass” on a question
- If you forgot the question while answering it, don't say "I forgot the question" or ask them to repeat it; just complete your thought, then say “did that answer your question?”
- If you’re nervous, don’t have caffeine right before the interview
- Don’t fidget, it's distracting for the interviewer and they'll think you're nervous & skittish. Relax your hands and feet
- Don't have your phone face-down in front of you, buzzing during the meeting. Have it tucked away & silent
- Show deference to the interviewer. Don’t act like you’re going to be peers; be respectful. Be extremely cautious about disagreeing or arguing with the interviewer.
- Understand that you’re not entitled to being mentored
- If they ask if you want water or coffee, say no thank you. Don’t make them do anything extra or serve you
- Don’t use filler words like “uh” and “um”. Train yourself to just pause while speaking instead of using filler words
- At least a few times during the interview, pause and think about your answer for 2-3 seconds before you reply. If you want to really stunt, pause for 5-6 seconds (actually think about your answer, don’t just pretend to think lol)
- Don’t let them trap you into revealing something negative. This isn't therapy. You are on stage
- Don’t say anything negative about past jobs, bosses or coworkers. Phrase everything in terms of showing that you’re a great fit who gets along well with everybody and has a positive attitude
- Don’t muse aloud about your future to the interviewer – you must give them the impression this job is your ideal job. Don’t talk about wanting to eventually do something entrepreneurial to the interviewer!
- Don’t say anything that implies that you see the job as finite, short-term, or a stepping stone, even if you do
- Don’t let your guard down and reveal anything that might put you out of contention. Remember that they are looking for a reason to reject you
- You're resume
- Boomers always say “it’s a numbers game” which is terrible advice. Applying to eight jobs with cover letters that are customized to the role is better than applying to fifty jobs with the identical non-customized cover letters.
- Do research on the firm before you write the cover letter and use that to customize it (I know it sucks to spend an hour on a cover letter then they don’t even reply, but keep in mind the people you're competing against are doing this)
- Don’t make the margins and type teeny-weeny just so that your resume fits on one page! Page-and-a-half is fine
- The name of your resume document should be Your Name Resume. Don’t make it the name of the firm you’re applying for. Make it convenient for the reader, not yourself
- Address the letter to the hiring manager. If the job posting says who you’ll be reporting to, address it to that person
- Personally I don’t think you should put an objective or the name of the job you’re applying to on the top of your resume. Just education, experience, interests
- Please have some kind of an actual job on your resume, whether it’s part-time job, summer job, co-op, started your own small business, something, anything. Nobody wants to be somebody’s first manager ever
- Career advice
- Can't emphasize enough that it's easier to find a job when you currently have a job – people want what somebody else has. Don't quit your job just so that you have "more time to spend on job search"
- Don’t send LinkedIn messages to people at the company who aren’t the hiring manager asking them to have conversations with you about the role! (Yes I know MBA career counsellors give you this bizarre advice)
- It is normal to feel savagely beaten to a pulp by the job search process. It is a ludicrous, demoralizing, gruelling, phoney ritual. Give yourself breaks & do kind things for yourself. The only way out is through
Marc's response when asked what he looks for in a new hire
- They do not care about a degree or GPA or test scores and in fact question if too much conscientiousness means you are too much of a rule-follower.
- They do care about results. They measure you by what you have actually done. Building companies requires being able to do things so that is the capacity they are looking for. List of things a founder will need to be able to do:
- Building an actual product that somebody will actually pay for.
- Figuring out a way to actually sell it to them
- Actually collect the money
- Actually service the customer so they actually have a good experience
- Actually tell their story so that anybody will even know that they exist
- Run a finance function so that they don’t lose all the money
- Run a legal function so they don’t get sued all the time
- Actually get others to work with them.
There are many talented people so the way to stand out is to actually demonstrate the ability to build or create.
Steve Martin best career advice ever: Be so good they can’t ignore you.
I will add to this document as necessary. If you want to see my own writing about careers and interviews you can find that below.