I had a great 25-year run as a Wall Street trader, but I have had to adapt to stay relevant. I have focused on learning to code in C#, C++, Java, R, Python, HTML5, .NET Framework, T-SQL and others in order to appeal to employers in the financial services industry. Now I’m coder instead.
Trading is a dying business. Electronic trading is growing. Every human trader still has to compete against many other human traders for a shrinking number of seats. Everyone is facing decreasing margins, so unless you can code, grasp data science and have other quantitative skills, forget about job security.
Big banks from Goldman and RBS to UBS and Nomura have replaced most of their equity traders with IT guys, market-making off of the automated-trading programs. It makes sense in this environment when it’s almost a liability to have the traders making public markets, because there’s a greater chance for them to skirt the rules. Now they can tell a regulator, “The algorithmic-trading program screwed up,” as opposed having to a human trader with fat fingers to blame.
If you’re still thinking in terms of front, middle and back office, you’re getting it all wrong. As Daniel Pinto at J.P. Morgan explained last month, the boundaries between the front and middle office are blurring as trades and technologists work side-by-side. IT team has to sit at the front-office desks. Right now, most IT people don’t have experience sitting in the front office and making markets, but that’s changing. More techies are learning how to operate in the front office.
If you’re a front-office person who has tech skills, then all the better, because your experience working in the markets still has value. Best to leverage that while you can.
For the moment, the demand for people with both automated-trading skills and front-office experience is high, and the supply is low. If you’re a trader, therefore, it makes sense to learn at least one programming language like Python, Microsoft .NET, Java, C# or C++, as soon as you can. Data analysis skills help too.
If you do this, you’ll still be employable. Banks want technologists who can write algos and code trading systems rather than old-school traders. And if you can’t do that? Perhaps you’re a people-person. There will always be a place for sales in financial services, but even salespeople need to be comfortable with the technology underpinning systems nowadays.