What the actual **** does a trader do?

I've read stuff about how traders can't trade the bank's money anymore and that traders at a bank don't do the same thing that day traders do. I've been told that they 'make markets' and that 'they trade clients' orders' but what do they actually do on days? Everything's really confusing...

look at 8 screens, talk to one another and hope for the best really

Make Markets - take the other side of a trade. E.g. someone wants to sell x amount of AAPL, MM would price it for them and buy then subsequently if someone wants to buy AAPL they would price and sell to them.

With the above^ however, not all desks are prohibited from prop trading (that is not just money being used to MM but actually putting money into theories) and can hold a certain amount of inventory (read: bank's money) in which they can sometimes trade to make more profit.

Trade for clients (flow) - literally just execute trades on behalf of clients whilst taking commission

Not really confusing tbh.

Market making and trading inventory requires a lot of risk management too, so there's that - especially so if you trade derivatives and any structured products.


Posted from TSR Mobile

Back in the day you were considered a hardcore trader when you traded Yu-Gi-Oh! Cards and match attaxs

So they just do what the client asks, right? Surely a computer could just buy an X amount of AAPL or execute client orders.

But thanks for yo answer homie! And best of luck on getting to IB!

And I've heard that trading is a really high pressure job but what's high pressure about just following client orders and just buying and selling when they ask you to do so?

(Also I don't wanna work as a trader but in sales I'd obviously need to know what traders do since I would work with them)

So they just do what the client asks, right? Surely a computer could just buy an X amount of AAPL or execute client orders.

But thanks for yo answer homie! And best of luck on getting to IB!

And I've heard that trading is a really high pressure job but what's high pressure about just following client orders and just buying and selling when they ask you to do so?

(Also I don't wanna work as a trader but in sales I'd obviously need to know what traders do since I would work with them)

So they just do what the client asks, right? Surely a computer could just buy an X amount of AAPL or execute client orders.

But thanks for yo answer homie! And best of luck on getting to IB!

And I've heard that trading is a really high pressure job but what's high pressure about just following client orders and just buying and selling when they ask you to do so?

(Also I don't wanna work as a trader but in sales I'd obviously need to know what traders do since I would work with them)

I've read stuff about how traders can't trade the bank's money anymore and that traders at a bank don't do the same thing that day traders do. I've been told that they 'make markets' and that 'they trade clients' orders' but what do they actually do on days? Everything's really confusing...

Make Markets - take the other side of a trade. E.g. someone wants to sell x amount of AAPL, MM would price it for them and buy then subsequently if someone wants to buy AAPL they would price and sell to them.

With the above^ however, not all desks are prohibited from prop trading (that is not just money being used to MM but actually putting money into theories) and can hold a certain amount of inventory (read: bank's money) in which they can sometimes trade to make more profit.

Trade for clients (flow) - literally just execute trades on behalf of clients whilst taking commission

Not really confusing tbh.

Market making and trading inventory requires a lot of risk management too, so there's that - especially so if you trade derivatives and any structured products.


Posted from TSR Mobile

No duh, why do you think HFTs are so prominent? Story changes when you have non exchange traded securities - which is the majority of products banks trade.

Lol, you're kind of mistaken mate. No trader just waits to do what the client says. To make markets you have to constantly be on the lookout for people wanting to buy/sell, and if you can't offload your end of the deal you're stuck with a certain amount of risk that you'll have to manage away (by hedging) or by finding another counterparty to your deal. All of this is VERY hard if there's volatility (i.e GBP/USD post brexit) because your risk could swing wildly against you.

If you're telling me having to constantly market make, hedge with other securities, calculate your greeks and risk exposure, take client flow orders, price transactions, find ways to trade volume for some extra profit to the bank (and thus your PnL), tweak models, communicate with counterparts/brokers, isn't stressful, you've got another thing coming bro.

Posted from TSR Mobile

Basically you get paid to have a gambling addiction

traders don't take on propietory (or however the fk you spell it) risk. volcker rule pretty much sliced that into pieces

Oh ok, so they just do market making?

nah, some desks still prop trade.

Posted from TSR Mobile

Which desks? Sorry for bothering you