"I'm an algo trader a top US bank. My colleagues leave for trading firms, then come back"
I'm an equities execution trading at a top US bank. My job is about creating, executing and babysitting trading high speed trading algorithms. I've done this for over a decade and if I wanted to, I could very easily find a job at a top electronic trading firm.
I don't want to.
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I know I'm not alone in this. A Goldman Sachs quant wrote earlier this year that he wouldn't leave for one of these firms either. He said they were ruthless and only suited to graduate trainees. To me, the problem seems to be that they offer very poor career progression.
I see a lot of people on my team leaving for these electronic trading firms, and then trying to come back to banks. Joining a top tier trading firm is always a good way to get a pay bump in the short term. But they find there are other issues.
A lot of trading firms have very flat structures. This is good when you're junior but harder when you're in the middle ranks. They can be harsh places and unforgiving places to work, particularly when times are tough. By comparison, banks are very hierarchical and their businesses are diversified. This makes it easier to build a long term stable career. At a bank, you can get promoted simply on the basis of tenure and they can withstand external shocks.
I think people are starting to realise that banks are better places to work. It can still be worth joining an electronic trading firm, but only for a few years. Go to these firms for a short amount of time, then come back to banking and head up a team. This is what my colleagues are doing.
This path makes sense because trading firms are prestigious employers and banks value people who've worked for them. But these trading firms are best used to get ahead in banking careers, not as a permanent alternative option.
Hardial Bal is a pseudonym
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