Trading? Great. Always Huge Money? Not so Much

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There's no corporate ladder for traders. It's more like a winding track with periodic pit stops. Sure, it takes an independent streak, mad math skills, and a strong personality, but it also helps to be at the right place at the right time.

Today, even profitable traders face the chopping block amid mass layoffs. It's only a choice few who've garnered fat bonuses and rock star status. That's part of the industry secret: Every trader isn't a multi-millionaire, notes a 13-year industry veteran who asked to remain anonymous for what are probably obvious reasons.

Trading, he says, is an evolutionary process. "Your job can take you through many incarnations. It requires you to take advantage of the opportunities and respond to the hard knocks."

A Long and Winding Road

He began his career in a choice internship at "a certain foreign international investment bank." From there, he joined a large specialist and market marking firm. "Then the floor started to die about 2003," he recalls. "I knew I had to segue way into a job 'upstairs.' I just happened to be in on the ground when the Russell 2000 and MidCap products were beginning to be hot. I thought the world was golden, and that I would always be rich. I was smart, but naïve."

Sitting on a tidy wad of company stock after a bulge-bracket firm bought his, our trader says he was looking for a way out. The usual annual mass layoffs came in 2004, and he asked to get paid out. "I hadn't had a vacation in six years."

But it wasn't long before he was back trading ETFs, opening a U.S. desk for a large international bank. By late 2007, when the sub-prime crisis hit the bank, every division bore a share of the brunt. "We were told to cut back risk," the trader says. "It didn't matter that we were on a profitable side."

By early 2008, he'd jumped ship yet again, frustrated with the big bank structure. Unfortunately, his last stop was a very short stint working with a major flameout hedge fund. But what's a trader to do when the resume looks stellar - 13 years of killer experience - short of a seven-month stretch with the likes of a scandalous shop? People might question the blip, but he says don't lie on the resume. The next employer will only find out about it on your U4 or U5.

On the job hunt, he remains optimistic, even with the market's downturn. "I've got quant and stat skills that will always be useful," he says. "I've kept strong ties in the industry, and people know my background and what I'm capable of."

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