Proprietary trading jobs, what is required?
Just like anything else in life, if you have no passion in what you’re doing, you will not give your 100%.
The same goes for trading. You must have a passion for it in order to succeed.
So what is a passion for trading?
It is not reading a few books on trading and thinking you got it.
Neither is it going to forums looking for the best trading strategy. These are hobbies and hobbies cost money.
Passion is devoting countless hours each day, weeks, months and even years to improve yourself. To get better and better each day, yet staying humble all the way.
You will be reading hundreds of trading books, spending infinite hours watching trading videos, and having a trading journal to record down your progress as a trader.
Does it sound like hard work?
This is the passion for trading.
2. Prove it
When you’re interviewing for a proprietary trading job, you must convince the interviewer about your passion for trading, and your ability to persevere.
How can you prove it?
The best way is to start trading on your own retail account. By showing the interviewer your own trading records, it tells them you are passionate about trading and actually walk the talk.
This will make you stand out from the thousands of applicants you are competing with.
Even if you’re a losing trader, it doesn’t matter.
Because it tells them you are accepting your current status (a losing trader), and want to improve your trading by joining a proprietary trading firm.
Here’s how to really stand out:
Bring along your trading journal and charts during the interview. Then use them to explain the thought process of your trades.
If you’ve done any backtests, bring the results along to show that you’re working hard to find an edge in the markets. That’ll impress your interviewers.
Passion alone is not enough. Read on to find out what else is required.
Studies have shown that Grit plays an important factor as well.
But what is grit?
Grit is the ability to keep moving forward even when the shit hits the fence.
Most traders will quit and stay away from trading after blowing up a few trading accounts.
But those with grit will constantly reflect their actions and seek to better themselves, which separates the winners from the losers.
I’ve spent close to 4 years learning how to trade, yet I wasn’t profitable.
It was depressing as I knew so much about trading but can’t turn my knowledge into profits.
Many times I felt that profitable trading is an illusion but never once did I considered giving up. There was always something in me that pushed me forward, and today I realized it is none other than grit.
I want you to read this book, Pit Bull: Lessons from Wall Street’s Champion Day Trader.
It’s about a trader called
4. Minimal liabilities during your learning curve
Here’s the kicker:
You want to have little liabilities and commitment as possible.
Best you are not married with kids, have no outstanding loans or any form of financial liabilities.
Most proprietary trading firms operate on the basis of giving traders a basic allowance, and a profit sharing scheme.
Also, trading has a steep learning curve, which can take a trader anywhere from 6 to 18 months to be consistently profitable.
The bottom line is this:
You will be living on a shoestring budget for a period of time, until you are consistently profitable. Thus it makes sense to reduce or have no liabilities at all.
Most proprietary trading firms will look for this factor, and this explains why they tend to hire fresh graduates below 30 years old.
Here’s another thing you should know..
5. Quick with numbers is a good thing
The trading approach of most proprietary trading firms is scalping, arbitraging or day trading.
Because you’re trading on lower time frames, you need to think fast and act fast.
So how do they test you?
During the interviews, they’d ask you mathematical questions (48 * 67), or solve some statistical puzzle (Monty Hall).
Some take it one step further by requiring you to pass a math test before granting an interview.
You can consider doing mathematical speed test a few weeks prior to your interview to improve your mental calculation.