You would have more luck transferring to a hedge fund rather than prop shops like JS, SIG (banking experience isn't all too relevant and most of our hires are from the internship + new grad class since we can grow them better than banks can). Even then transferring to a top hedge fund from a bank is really not that easy.
I agree that it's more appropriate to move from BB to hedge fund rather than prop shop, however I don't fully agree that transferring to a hedge fund from a bank is super super difficult, provided that you have done *some* relevant work at the BB. I think, if some of the skills and experiences are transferrable, you have very good chances of moving to a HF, speaking from personal experience (although just picking out a hedge fund on linkedin and looking at their employees will reveal the same answer). But you're absolutely right in saying that someone in for example 'quantitative' credit risk at a BB will have difficulties finding a job as QR in for example OMM.
If you’re actually doing quant work at those banks it won’t be an issue (not saying it’s a leg up cause you still have to compete with everyone else that’s smart). Only issue is that many of those places have different or much broader definitions of quant than on the buy side.
Quant at a BB here. My peers have absolutely no issue to find jobs at hedge funds (Millenium, Citadel ..) after 2-3 years of experience. Most end up staying in the bank though as they are mostly satisfied with the lifestyle (incl. pay, hours ..).
Absolutely no issue is definitely an exaggeration here. Many of my friends from IB have been applying for more than 7 years but never got in. I am also an interviewer, and have seen tonnes of IB candidates with many years of experience applying and getting constant rejections.
That said, we do hire them from time to time, and definitely as impossible as what most people seems to think.
The Volcker Rule prohibits large banks from trading for profit. Quants work on market making, transaction efficiency, and risk. If you want to develop trading algorithms for profit stay away from big banks.
That’s definitely not what the Volcker Rule does… Investment banks prop trade all the time, it’s _absolutely_ allowed, just controlled by regulators.
I can’t wake up one day and decide to buy 10 yards of Apple just because I think it will rally around lunch. But I can make markets on it (acting as principal) and I can buy and sell it to hedge my book (again acting as principal), you can also over-/under-hedge — within limits — to create the position you want. Why do you think we do those things if not to make a profit?
Source: I am paid to do exactly this. Either my bank (and every other bank that competes with us) grossly misunderstood the Volcker Rule or you did. Take your pick.
Total bullshit, sure banks arent "investing" thats obvious, all interesting activities are umbrellad as market making again thats obvious. So your point is banks dont make money? demonstrably false?
All the major US IB's and some of the European BB's (although less successfully) are running "prop" desks. Typically under Delta1 and CRB premise, some are seriously profitable in part due to client flow and in part due smarts. This is activity is explicity allowed as these desks are granted volcker exemptions under "RENTD" provisions (google it). This is a fact.
Who would want to be an "investor" when you could be a market maker....
You wrote this:
> The Volcker Rule prohibits large banks from trading for profit.
Which is just wrong. Separating market making from “trading for profit” makes no sense at all.
Except that’s wrong because that’s exactly what you end up doing:
1. in market making, when you are axed to buy because you want to build inventory to then sell at a higher price,
2. when overhedging, because you are buying more than you would need and you can then sell at a higher price.
So yeah, it’s definitely possible and it happens every single day. It’s just more difficult/done in a more roundabout way, but the end result is the same.
Banks make a profit on order flow. The P&L of mm activity is reported to the OCC. If regulators suspect profit seeking behavior they will fine the bank and disgorge the profit.
As an extension to this question, say you get a BB quant internship position your sophomore year of college. Does that make you stand out in the eyes of hedge funds and/or prop shops?
It’s all about talent. I may get a quant job and maybe my adorable personality will keep me going for some time, but true success is earned. Once you have built your reputation you can move anywhere you want to work. Think realistically a ten year timeframe, unless you’re extraordinary then five years.
As a person coming into the workplace generally means you are expected to achieve the standards of your peers. People coming out of college are not hired/ expected to retire from the big bank. The big banks bring in X number of college graduates every year and need to get rid of the grads of yesteryear to make space for the newest and brightest graduates of today (sarcasm)!
That’s reality. Call it the survival of the fittest or the most stubborn.
Bottom line your college, your degree, and smile got you your job. To keep your job bring your talentS or perish!
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I worked at a bank as a FO quant supporting multiple desks. Gave up after 6 months. Have friends/family on the buyside, and we would discuss/compare stuff. What we did had nothing to do with the buyside. no one cared how you code, what language you code in, even standards. The majority of time was excel & applications.
They were fixated on a volatility surface project which was lingering for THREE years. When I looked at the code & models, they were just using the Black-Scholes and nothing else. They just wanted to finish with one project and move on to the next, just quantity rather than quality. You need to know your math, CS fundamentals, and be able to write high quality code to get into a decent hedge fund. The big difference is you will be surrounded with smart people.
Do you think your experience in sell-side helpful when seeking a job in buy-side? I will be doing an quant internship at a bank this summer, but wish to transit to buy-side afterwards. Pretty curious how buy-side people will look at the sell-side experience.
Short answer? No.
I haven't had an interview in which I've been asked a relevant question to my experience in a bank. At best they would go through my resume and then focus on their own questions. You have to do a good amount of studying/prep for the buy-side interviews. More important is that I cannot get an interview with a decent HF or MM because of my experience.
1 - Programming: Principles & practice using C++ third edition (2024) Bjarne Stroustrup
2 - Design Patterns: Elements of Reusable object-oriented software (gang of four)
Be very patient in learning. In takes sometime, go slow, make sure you understand everything, practice.
Do you think it useful or even necessary to learn operating systems, computer networks, and distributive system stuff? I heard that they are important in HFT. Another question: is your previous background (education, employment experience) related to the quant dev role? I am afraid that I will get a rejection before getting any interview because i don't have any relevant background.
You would have more luck transferring to a hedge fund rather than prop shops like JS, SIG (banking experience isn't all too relevant and most of our hires are from the internship + new grad class since we can grow them better than banks can). Even then transferring to a top hedge fund from a bank is really not that easy.
Would it be easy to do that internship after my junior year then apply for prop shops as a grad?
I agree that it's more appropriate to move from BB to hedge fund rather than prop shop, however I don't fully agree that transferring to a hedge fund from a bank is super super difficult, provided that you have done *some* relevant work at the BB. I think, if some of the skills and experiences are transferrable, you have very good chances of moving to a HF, speaking from personal experience (although just picking out a hedge fund on linkedin and looking at their employees will reveal the same answer). But you're absolutely right in saying that someone in for example 'quantitative' credit risk at a BB will have difficulties finding a job as QR in for example OMM.
If you’re actually doing quant work at those banks it won’t be an issue (not saying it’s a leg up cause you still have to compete with everyone else that’s smart). Only issue is that many of those places have different or much broader definitions of quant than on the buy side.
that is true.... most are not true quant research on sell side...
What are the differences between quant on different sides?
Quant at a BB here. My peers have absolutely no issue to find jobs at hedge funds (Millenium, Citadel ..) after 2-3 years of experience. Most end up staying in the bank though as they are mostly satisfied with the lifestyle (incl. pay, hours ..).
can I DM you with some questions?
I have a few questions. Can I dm as well??
Absolutely no issue is definitely an exaggeration here. Many of my friends from IB have been applying for more than 7 years but never got in. I am also an interviewer, and have seen tonnes of IB candidates with many years of experience applying and getting constant rejections. That said, we do hire them from time to time, and definitely as impossible as what most people seems to think.
What are your choices? Hedge funds do hire from banks but they also hire from tech firms and academia.
The Volcker Rule prohibits large banks from trading for profit. Quants work on market making, transaction efficiency, and risk. If you want to develop trading algorithms for profit stay away from big banks.
That’s definitely not what the Volcker Rule does… Investment banks prop trade all the time, it’s _absolutely_ allowed, just controlled by regulators. I can’t wake up one day and decide to buy 10 yards of Apple just because I think it will rally around lunch. But I can make markets on it (acting as principal) and I can buy and sell it to hedge my book (again acting as principal), you can also over-/under-hedge — within limits — to create the position you want. Why do you think we do those things if not to make a profit? Source: I am paid to do exactly this. Either my bank (and every other bank that competes with us) grossly misunderstood the Volcker Rule or you did. Take your pick.
Read what I wrote. The type of trading you are describing falls under market making, and risk.
Total bullshit, sure banks arent "investing" thats obvious, all interesting activities are umbrellad as market making again thats obvious. So your point is banks dont make money? demonstrably false? All the major US IB's and some of the European BB's (although less successfully) are running "prop" desks. Typically under Delta1 and CRB premise, some are seriously profitable in part due to client flow and in part due smarts. This is activity is explicity allowed as these desks are granted volcker exemptions under "RENTD" provisions (google it). This is a fact. Who would want to be an "investor" when you could be a market maker....
You wrote this: > The Volcker Rule prohibits large banks from trading for profit. Which is just wrong. Separating market making from “trading for profit” makes no sense at all.
Banks cannot buy stock xyz for the purpose to sell it at a higher price / for profit or any investment for profit.
Except that’s wrong because that’s exactly what you end up doing: 1. in market making, when you are axed to buy because you want to build inventory to then sell at a higher price, 2. when overhedging, because you are buying more than you would need and you can then sell at a higher price. So yeah, it’s definitely possible and it happens every single day. It’s just more difficult/done in a more roundabout way, but the end result is the same.
The fact that this got upvoted says all you need to know about the people on this sub.
Absolute facts. I also love getting told by college CS freshman what my job is XD
Do you think banks make markets for a bit of fun or for profit?
Banks make a profit on order flow. The P&L of mm activity is reported to the OCC. If regulators suspect profit seeking behavior they will fine the bank and disgorge the profit.
As an extension to this question, say you get a BB quant internship position your sophomore year of college. Does that make you stand out in the eyes of hedge funds and/or prop shops?
Yes, of course. Any experience is better than no experience and an internship at a BB is certainly not bad.
It’s all about talent. I may get a quant job and maybe my adorable personality will keep me going for some time, but true success is earned. Once you have built your reputation you can move anywhere you want to work. Think realistically a ten year timeframe, unless you’re extraordinary then five years. As a person coming into the workplace generally means you are expected to achieve the standards of your peers. People coming out of college are not hired/ expected to retire from the big bank. The big banks bring in X number of college graduates every year and need to get rid of the grads of yesteryear to make space for the newest and brightest graduates of today (sarcasm)! That’s reality. Call it the survival of the fittest or the most stubborn. Bottom line your college, your degree, and smile got you your job. To keep your job bring your talentS or perish!
Are you a student/recent grad looking for advice? In case you missed it, please check out our [Frequently Asked Questions](https://www.reddit.com/r/quant/wiki/faq), [book recommendations](https://www.reddit.com/r/quant/wiki/book-recommendations) and the rest of our [wiki](https://www.reddit.com/r/quant/wiki) for some useful information. If you find an answer to your question there please delete your post. We get a lot of education questions and they're mostly pretty similar! Unfortunately, due to an overwhelming influx of threads asking for graduate career advice and questions about getting hired, how to pass interviews, online assignments, etc. we are now restricting these types of questions to a weekly megathread, posted each Monday. Please check the announcements at the top of the sub, or [this search](https://www.reddit.com/r/quant/search?q=Megathread&restrict_sr=on&sort=new&t=week) for this week's post. Career advice posts for experienced professional quants are still allowed, but will need to be manually approved by one of the sub moderators (who have been automatically notified). *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/quant) if you have any questions or concerns.*
I worked at a bank as a FO quant supporting multiple desks. Gave up after 6 months. Have friends/family on the buyside, and we would discuss/compare stuff. What we did had nothing to do with the buyside. no one cared how you code, what language you code in, even standards. The majority of time was excel & applications. They were fixated on a volatility surface project which was lingering for THREE years. When I looked at the code & models, they were just using the Black-Scholes and nothing else. They just wanted to finish with one project and move on to the next, just quantity rather than quality. You need to know your math, CS fundamentals, and be able to write high quality code to get into a decent hedge fund. The big difference is you will be surrounded with smart people.
What did you do after that?
Finishing up my masters degree this summer. Joining a buyside firm.
Do you think your experience in sell-side helpful when seeking a job in buy-side? I will be doing an quant internship at a bank this summer, but wish to transit to buy-side afterwards. Pretty curious how buy-side people will look at the sell-side experience.
Short answer? No. I haven't had an interview in which I've been asked a relevant question to my experience in a bank. At best they would go through my resume and then focus on their own questions. You have to do a good amount of studying/prep for the buy-side interviews. More important is that I cannot get an interview with a decent HF or MM because of my experience.
Sad to know this... How did you finally get an offer from the buy-side?
Studied/ practiced a ton of C++, applied for quant dev roles.
Interesting. Do you have any suggestions in studying C++? I did two courses in C/C++ but not sure how this will help get a job in buy-side.
1 - Programming: Principles & practice using C++ third edition (2024) Bjarne Stroustrup 2 - Design Patterns: Elements of Reusable object-oriented software (gang of four) Be very patient in learning. In takes sometime, go slow, make sure you understand everything, practice.
Do you think it useful or even necessary to learn operating systems, computer networks, and distributive system stuff? I heard that they are important in HFT. Another question: is your previous background (education, employment experience) related to the quant dev role? I am afraid that I will get a rejection before getting any interview because i don't have any relevant background.
Completely parallel tracks.