Average Career Length of a Trader...
How long do traders stay in the trading floor on average before retiring? I've heard from 8-10 years, is that so? It just seems to me that 8-10 years is not enough to make enough for retirement, I mean get out while in your 30's?
it really depends where you work and how good you are... if you're subpar, you'll be out within two years (even less if you're at a shop like Susquehanna or drw). I've heard the "10 years" value too, and it does seem a bit short. I'm sure if you're a superstar then there really is no limit.
Even if you suck, you'll be able to stay for 2 years at an investment bank (although after that you won't get asked to stay on). There is plenty of bitchwork to be done on a trading desk, so even if the analyst is not going to be a good trader, there are things for him/her to do.
If you really suck though, your career length will be 10 weeks..the amount of time you spend interning at the company haha. Banks/HFs are pretty good at telling who is going to be a good trader pretty quickly..that's why s&t summer analyst classes are huge, and only like 30-50% of people get asked back on average. I'm not saying you need to be a 4.0 applied math major from Harvard, but it certainly helps. You and the bank will be able to tell pretty quickly whether you have what it takes.
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thanks for the input
"It just seems to me that 8-10 years is not enough to make enough for retirement, I mean get out while in your 30's?"
This is false, it is plenty, just depends what kind of retirement you want.
i know guys who have been in the biz 15+ years. lots of treasury traders have been around for years. guys over 40 aren't an endangered species on trading floors.
Allright Jimbo thanks, so 8-10 years is not the "rule" but it is enough time to make a lot of money so that's why some leave, right?
There are plenty of trader's on my floor over 40, and not all of them because they are great at what they do (although most are).
so, what happenes afterwards??? do you go to a hednge fund, do you invest your money???
...over 40 isnt rare, but over 50 is a little bit uncommon. I would say most guys who are in their "prime", ie running hedge funds or prop desks, are in their late 30's to late 40's. Really you make enough to retire trading in much less then 10 years, its just a matter of getting into the right seat for the time leading up to that. Ie a progression might be: work on a sell-side desk for a few years as an assistant/analyst, become a succesful trader or salesman, build a reputation as a sharp person, raise capital to start a hedge fund or start trading prop, build a performance record that allows you to grow your capital base, have one or two enormous years on that enlarged capital base, and then u r set. This could take 10 years for a prodigy or 30 years for somebody who is merely great. At each step along the way 90% of people are weeded out and find something else to do.
What do the people who are weeded out do, both on the sales side and the trading side?
I'm 27, been on the energy desk as intern - sales/analyst - trader. The 10 year span seems fairly accurate, but this is not as a result of the amount of money they made. Plenty of people say "I don't need this" and bail to a slightly more peaceful environment. Those that are VERY good at their job and are still trading into their late 40's and 50's oftentimes do it for the action or love of the game. Would I like to be able to retire at 40? Sure. Would I? Never. I'm having too much fun and think it will continue for some time.
...let me also add to my above post that if you are at a good shop you can easily get rich and retire in your 40's as a salesman or trader on the sell-side w/out moving to the buyside...good salesman at firms with a good franchise in the product they sell make millions and the same goes for traders on those desks. But i have only worked on the buyside so cant really speak to that track as well...
Bondarb thank you so much, very insightful response
..."weeded out" might have been a strong term....if u get bounced out as an analyst or young trader you probably leave the industry, if you have made it past those levels you just dont advance anymore and become a career sell-side trader/salesman, which as i mentioned above can be very lucrative and definitely is usually at least a good living.
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