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Old 12-04-2012, 02:41 PM   #42101
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Why do traders like hookers and blow so much?
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Old 12-04-2012, 02:42 PM   #42102
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Re: SE FAQ, Liveblog and Holiday Discussion

any use for a person with a biology PhD in trading?
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Old 12-04-2012, 02:42 PM   #42103
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what do you trade?
Imaginary goods ldo
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Old 12-04-2012, 02:45 PM   #42104
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Re: SE FAQ, Liveblog and Holiday Discussion

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what do you trade?
Our group trades options on US Treasury futures. There are 5 products we trade that are all highly correlated (2-year treasury futures through 30-year US Treasury Bond futures). I started as an assistant trader about 9 months ago (not really trading anything, basically just assist the traders and make sure everything we do is accounted for, while also learning how to trade. In about a month, I'll be transitioning to the overnight shift where I'm in there by myself trading during European hours until my boss and everybody else gets in the office in the morning.

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Why do traders like hookers and blow so much?
Same reason poker players like hookers and blow so much. Traders are mostly young guys who make too much money, they gotta blow it somewhere.
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Old 12-04-2012, 02:47 PM   #42105
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Re: SE FAQ, Liveblog and Holiday Discussion

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any use for a person with a biology PhD in trading?
If you have an interest in trading and have exceptional analytic skills, put a resume together tailored to trading and someone will give you a look.
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Old 12-04-2012, 02:49 PM   #42106
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Re: SE FAQ, Liveblog and Holiday Discussion

Are treasury futures options much more liquid than options on other futures contracts? I know corn options, for example, is still heavily pit based. Who is your biggest competition? What's your timeframe for trades?
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Old 12-04-2012, 02:49 PM   #42107
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Re: SE FAQ, Liveblog and Holiday Discussion

What skills do you develop as a floor trader that you can't develop in an office environment?

What are the benefits and drawbacks of being a floor trader?

Why is volume so light today?

What date do you think a deal will get done on the fiscal cliff?

Who do you think was responsible for the 2.36 million share block trade on AAPL this morning?
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Old 12-04-2012, 02:54 PM   #42108
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Re: SE FAQ, Liveblog and Holiday Discussion

so you have exceptional analytic skills and make too much money

sick barg
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Old 12-04-2012, 02:57 PM   #42109
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Re: SE FAQ, Liveblog and Holiday Discussion

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Are treasury futures options much more liquid than other futures contracts? I know corn, for example, is still heavily pit based. Who is your biggest competition? What's your timeframe for trades?
Ours is one of the bigger pit complexes. I don't know a ton about other products, but our volume has been significantly down over the last 6 months or so. Our volume is probably split about 50/50 between on the trading pit and on the internet-based trading platform. Usually anything big that happens that drives action will happen in the pit, then smaller stuff trades on the screen (computer) after that.

We don't really have big competition per se. We are what you call locals, so our job is essentially to provide a market for big banks to trade in. We have to manage our risk, so we trade depending on the position we have on our books at the moment, but the function we have to provide is being on both sides of a trade. We have a theoretical value assigned to each contract, and we will buy it for (TV - X) and sell it for (TV + Y) depending on market conditions and other factors. Big banks don't care about paying the amount below or above theoretical value, so in essence that is the "fee" that they pay to us for providing a liquid market. Most times all locals are on the same side of the trades, so we are usually in the same position, although there are some with bigger money behind them that can move things to their advantage. Our group hopefully will be there in a couple years, but we only have been trading for about 18 months or so. Over time our backers will give us more money to trade with, and that will allow us to do different things.

Time window depends. In the pit it is a bit of a slower process where orders will be lined up before anything trades. On the screen, often times I have maybe 4-5 seconds to see something trade, determine if I want to trade it, and execute the trade. On good trades, it just becomes a fastest finger/thinker competition of sorts for who gets it, so quick thinking is imperative.
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Old 12-04-2012, 02:57 PM   #42110
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Re: SE FAQ, Liveblog and Holiday Discussion

hows the pork belly future lookin?
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Old 12-04-2012, 03:01 PM   #42111
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Re: SE FAQ, Liveblog and Holiday Discussion

Nice, man. Enjoy the pit while it still exists cuz they're all dying and HFTs have overtaken the role of the local on screen business. You can make a killing as a local if they're feeding orders into the pit.
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Old 12-04-2012, 03:04 PM   #42112
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This is an interesting way to make a brag, but I dig it.
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Old 12-04-2012, 03:07 PM   #42113
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Re: SE FAQ, Liveblog and Holiday Discussion

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What skills do you develop as a floor trader that you can't develop in an office environment?
Reading this as you're asking for the difference between doing trading and a traditional office environment. I think it's just the rapid pace aspect of it that is not really created in a lot of environments. We have 7 guys on one wire during the day, all communicating different information, so you develop a keen sense of selecting what information to pass, all while making decisions with only a few-seconds wide window to execute a decision.

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What are the benefits and drawbacks of being a floor trader?
Benefits - Pay is good, I work a strict 50 hours per week and don't have to work weekends ever.

Drawbacks - I've had one non-holiday day off all year and will probably get around 3-4 all of next year. Job security isn't great as if you don't perform and improve you are not guaranteed anything. External market influences can really mess with your yearly bottom line if you get caught in a bad spot (Thanks Bernanke!)

Quote:
Why is volume so light today?
Today I'm not sure. Volume for us has been light because our underlying future just hasn't moved very much. When we have very low volatility, there is very little trading. Just seems like in today's market, everybody is just waiting from headline event to headline event rather than trading on normal market conditions. First it was Europe resolution, then Quantitative Easing, now the Fiscal Cliff. I'm sure after the Fiscal Cliff it will be something else.

Quote:
What date do you think a deal will get done on the fiscal cliff?
I think something will get done in 2 weeks or so. Might get some help from the Fed here I guess. For us, we don't really care as we don't do enough size of trades to take a stand on the market one way or another. We try to make sure we're hedged well and take on minimal risk while still making money no matter where our product moves.

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Who do you think was responsible for the 2.36 million share block trade on AAPL this morning?
Don't really pay much attention to the equity markets, so I have no idea. PIMCO maybe?
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Old 12-04-2012, 03:07 PM   #42114
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Re: SE FAQ, Liveblog and Holiday Discussion

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hows the pork belly future lookin?
We're all waiting for Eddie Murphy to drive the interest in the market again.
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Old 12-04-2012, 03:11 PM   #42115
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Re: SE FAQ, Liveblog and Holiday Discussion

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This is an interesting way to make a brag, but I dig it.
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Old 12-04-2012, 03:22 PM   #42116
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Re: SE FAQ, Liveblog and Holiday Discussion

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Originally Posted by Zimmer4141 View Post
Reading this as you're asking for the difference between doing trading and a traditional office environment. I think it's just the rapid pace aspect of it that is not really created in a lot of environments. We have 7 guys on one wire during the day, all communicating different information, so you develop a keen sense of selecting what information to pass, all while making decisions with only a few-seconds wide window to execute a decision.



Benefits - Pay is good, I work a strict 50 hours per week and don't have to work weekends ever.

Drawbacks - I've had one non-holiday day off all year and will probably get around 3-4 all of next year. Job security isn't great as if you don't perform and improve you are not guaranteed anything. External market influences can really mess with your yearly bottom line if you get caught in a bad spot (Thanks Bernanke!)



Today I'm not sure. Volume for us has been light because our underlying future just hasn't moved very much. When we have very low volatility, there is very little trading. Just seems like in today's market, everybody is just waiting from headline event to headline event rather than trading on normal market conditions. First it was Europe resolution, then Quantitative Easing, now the Fiscal Cliff. I'm sure after the Fiscal Cliff it will be something else.



I think something will get done in 2 weeks or so. Might get some help from the Fed here I guess. For us, we don't really care as we don't do enough size of trades to take a stand on the market one way or another. We try to make sure we're hedged well and take on minimal risk while still making money no matter where our product moves.



Don't really pay much attention to the equity markets, so I have no idea. PIMCO maybe?
having everyone on a wire sounds pretty cool.

when you say pay is good that can mean a lot of different things. We talking 75-125k? 125-175k? 175-250k? 250k-400k? 400k+? Chicago isn't NYC, but its also not that cheap.

after the Fiscal Cliff it will be back to Europe imo.

I kinda just wanted to get an actual date for a guess on a deal. I am thinking December 21st and then January 4th are most likely-in that order.

arent treasuries pretty boring compared to equity?
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Old 12-04-2012, 03:22 PM   #42117
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Re: SE FAQ, Liveblog and Holiday Discussion

Worst trading ****-up?
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Old 12-04-2012, 03:27 PM   #42118
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Man zimm I do not envy that night shift
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Old 12-04-2012, 03:27 PM   #42119
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Re: SE FAQ, Liveblog and Holiday Discussion

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having everyone on a wire sounds pretty cool.

when you say pay is good that can mean a lot of different things. We talking 75-125k? 125-175k? 175-250k? 250k-400k? 400k+? Chicago isn't NYC, but its also not that cheap.

after the Fiscal Cliff it will be back to Europe imo.

I kinda just wanted to get an actual date for a guess on a deal. I am thinking December 21st and then January 4th are most likely-in that order.

arent treasuries pretty boring compared to equity?
Basically everybody in our group makes $60k base plus bonus compensation. I'll find out in about 3 weeks what my first year's bonus is. I'm really not sure what it's going to be. My boss never really discusses his compensation, but he's 29 and I wouldn't be shocked if he got over $750k take home this year.

Treasuries probably are pretty boring compared to equity, but I've never traded equities so I don't have a comparison point. There is more volume and volatility in equity futures compared to treasury futures, so I would assume that leads to there being more action and more money to be made in equities.

As for when the deal gets done, I really don't know. We're preparing as if it could happen any day after next Wednesday, but right now we're more concerned with Unemployment on Friday and the next Federal Reserve meeting next Wednesday than we are with Fiscal Cliff stuff.
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Old 12-04-2012, 03:33 PM   #42120
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Re: SE FAQ, Liveblog and Holiday Discussion

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Worst trading ****-up?
Worst screw up I made was when I was supposed to lower our model by .4 ticks and actually lowered it by 4 ticks. We got hit on some quotes we had in, and ended up losing like $6k on that. I haven't had any notable screw-ups $$ wise yet while trading, but I'm sure that'll happen, especially when I'm by myself on overnights and I'm in charge of everything rather than being our #4 guy responsible for trades.

Funniest story I heard from our pit was from like 4-5 years ago. Like 2 minutes before unemployment, broker quotes an order, trader (who thankfully traded for himself and nobody else, and had insane amounts of money backing him) turns and says "sold" thinking he would buy like a 500 lot of calls. Broker says "ok you're filled, 20,000." Trader negotiates it down to a 10,000 lot. He has to sell 5,000 futures against the trade, can't get filled because no futures trade right before unemployment comes out. Unemployment is way above expectation, our futures break like 32 ticks. For every futures tick, he loses $31.25. So (5,000)*(32)*(31.25) equates out to roughly $5 Million.

To pile on, guy had to go to a party that following night, and everybody is telling him about the story of some dumbass who didn't get filled on futures for a trade and got hung for $5 Million.
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Old 12-04-2012, 03:54 PM   #42121
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Re: SE FAQ, Liveblog and Holiday Discussion

What firm do ya work for?
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Old 12-04-2012, 03:57 PM   #42122
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Re: SE FAQ, Liveblog and Holiday Discussion

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What firm do ya work for?
Would rather not give that out for obvious reasons imo. It's not terribly relevant anyways. We're a small firm in Chicago with around 60 employees, doubt we have any name recognition outside of Chicago anywhere. If you've heard of DRW, it's basically the exact same setup as that just on a much smaller scale.
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Old 12-04-2012, 04:01 PM   #42123
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Re: SE FAQ, Liveblog and Holiday Discussion

I've heard of DRW. I used to work for Jane Street Capital and am considering getting back into trading at some point, if you PM me the name I'll probably go ahead and drop my resume for funsies.

What sort of hours do you work?
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Old 12-04-2012, 04:02 PM   #42124
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What can you tell me about FCOJ
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Old 12-04-2012, 04:14 PM   #42125
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Re: SE FAQ, Liveblog and Holiday Discussion

news corp is the most vile entity on earth

that is all

edit: pretty fascinating stuff, zim
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