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Trading firms aren't used to losing, be it in the stock market or the job market.
A career in the trading industry can be a tough sell to the blue-jeaned, tech-savvy crop of graduates expecting to flock into Silicon Valley's start-ups and technology giants. Still, as technology becomes increasingly important to Wall Street, securing the computer programmers and software engineers who harness it best has become a priority.
So high-frequency trading and electronic market-making firms are stepping up their recruiting game, offering competitive salaries and sweetening their perks in an effort to lure the top talent.
Employees at the Chicago offices of Chopper Trading can play shuffleboard, pool, Ping-Pong or videogames in the firm's 3,000-square-foot game and exercise room. At night, after US markets close, they have access to tickets to a skybox at Chicago Bulls basketball games, Blackhawks hockey matches or the Chicago Symphony Orchestra, organised paintball trips and company dinners.
"We have virtually no turnover," said Chopper Trading chief executive Raj Fernando. "They're well paid, they're well taken care of - we give them a reason not to go anywhere else."
The recruitment battle comes as the high-frequency trading industry, while garnering an ever-greater portion of market volume, grapples with image problems. The industry's reputation has suffered in the wake of the financial crisis and last year's May 6 "flash crash," which drew the attention of regulators. And for idealistic graduates, the luster of working for the cutting-edge social-networking or Web-search firms like Facebook or Google can outshine even a hefty paycheck.
The competition for new hires often starts on college campuses, where both technology and trading firms target computer-science students. Trading firms said it can be tough to persuade computer-oriented students to consider forgoing a career at a pure tech company to enter the world of finance.
"It's very hard to compete with the well-known start-ups here in California," said Pang Chau, the Santa Clara-based managing director of market maker Knight Capital Group's electronic-trading group.
"I've had people in interviews ask me point-blank what the social value is that we're adding," Chau said. As a computer-science graduate student at Stanford University in 2001, Mr. Chau was at first hesitant about taking a job in finance. He says he dropped off his résumé at a Knight Capital career-fair booth only because he felt guilty accepting a free T-shirt recruiters were giving away.
But programmers usually come to see the upside of working for trading firms, Mr. Chau said. For instance, programmers find they like how quickly they see their work tested in the market and translated into profits. "Once they're in the door, rarely do we lose them to tech companies," he said.
New hires at trading firms can expect to put their programming and software engineering expertise to use quickly, writing computer algorithms or working on technology key to the firms' profitability.
"You're going to work on projects that are going to contribute to the firm within weeks of being here," said Adam Nunes, part of the business development group at Hudson River Trading, a proprietary-trading shop of about 60 people.
Key to trading firms' appeal is their pay. A new high-frequency trading programmer with no advanced degree can expect to make between $75,000 to $95,000 in the first year, plus a bonus, which can add an additional 10% to 50%, according to Objective Paradigm, a recruiting company that works with proprietary-trading firms.
Tech firms generally pay about 10% less, Objective Paradigm said, but deferred compensation and options are incentives that could be worth more down the road.
"We'll just pay much more than the Googles and the Facebooks of the world," Chopper's Fernando said.
Spokesmen from Google and Facebook declined to comment.
Still, Silicon Valley firms hold the promise of a different lifestyle, which often features later hours not pegged to the market day and more potential for telecommuting, said Mary Voss, chief executive of Foxhunt Staffing, a Los Altos recruiting firm. And job candidates can be wary of taking a job that lands them outside the bubble of technology and social-media companies.
"It's easy to go from a Yahoo to a Google to a Facebook to a Twitter," Voss said. "It's harder to go from a high-frequency trading firm to a Twitter. That's something people take into consideration."
And students may not have even heard of the companies trying to woo them, even though high-frequency trading shops now make up roughly 56% of trading volume in US stocks, according to Tabb Group, a financial markets research group.
Being able "to go tell mom and dad you're going to work at a name-brand organisation is powerful," said Anthony Dostellio, managing director at Objective Paradigm.
Still, while trading firms don't always have the same buzz as a tech titan or start-up, the catered meals, plasma TVs and regular massages at some trading firms are helping lure more of the top talent, Dostellio said. After visiting trading firms, candidates "would come out of those environments and they would just be floored," he said.
Mark Stehlik, assistant dean for undergraduate education at Carnegie Mellon's School of Computer Science, notes that while trading and electronic market-making firms snap up only a fraction of graduating technology specialists, they have "definitely learned how to play the game."
Trading firms including Tradeworx, RGM Advisors and DRW Trading Group have all hired recent Carnegie Mellon computer-science grads, according to data from the school's career centre. "They understand high offers can attract good talent and are definitely in there swinging," said Stehlik.
Trading firms are even quietly persuading some technology specialists already employed in Silicon Valley to make the jump into finance. In 2010, Objective Paradigm helped its trading clients hire 30% more people than in the previous year who had been working at non-financial California companies, the company said.
Judging by the calibre of their newest employees, high-frequency trading firms say the recruiting is working. "We all joke we'd never get a job in our own company now," Fernando said.
Battle for tech geeks: Street vs. Silicon Valley
A career in the trading industry can be a tough sell to the blue-jeaned, tech-savvy crop of graduates expecting to flock into Silicon Valley's start-ups and technology giants. Still, as technology becomes increasingly important to Wall Street, securing the computer programmers and software engineers who harness it best has become a priority.
So high-frequency trading and electronic market-making firms are stepping up their recruiting game, offering competitive salaries and sweetening their perks in an effort to lure the top talent.
Employees at the Chicago offices of Chopper Trading can play shuffleboard, pool, Ping-Pong or videogames in the firm's 3,000-square-foot game and exercise room. At night, after US markets close, they have access to tickets to a skybox at Chicago Bulls basketball games, Blackhawks hockey matches or the Chicago Symphony Orchestra, organised paintball trips and company dinners.
"We have virtually no turnover," said Chopper Trading chief executive Raj Fernando. "They're well paid, they're well taken care of - we give them a reason not to go anywhere else."
The recruitment battle comes as the high-frequency trading industry, while garnering an ever-greater portion of market volume, grapples with image problems. The industry's reputation has suffered in the wake of the financial crisis and last year's May 6 "flash crash," which drew the attention of regulators. And for idealistic graduates, the luster of working for the cutting-edge social-networking or Web-search firms like Facebook or Google can outshine even a hefty paycheck.
The competition for new hires often starts on college campuses, where both technology and trading firms target computer-science students. Trading firms said it can be tough to persuade computer-oriented students to consider forgoing a career at a pure tech company to enter the world of finance.
"It's very hard to compete with the well-known start-ups here in California," said Pang Chau, the Santa Clara-based managing director of market maker Knight Capital Group's electronic-trading group.
"I've had people in interviews ask me point-blank what the social value is that we're adding," Chau said. As a computer-science graduate student at Stanford University in 2001, Mr. Chau was at first hesitant about taking a job in finance. He says he dropped off his résumé at a Knight Capital career-fair booth only because he felt guilty accepting a free T-shirt recruiters were giving away.
But programmers usually come to see the upside of working for trading firms, Mr. Chau said. For instance, programmers find they like how quickly they see their work tested in the market and translated into profits. "Once they're in the door, rarely do we lose them to tech companies," he said.
New hires at trading firms can expect to put their programming and software engineering expertise to use quickly, writing computer algorithms or working on technology key to the firms' profitability.
"You're going to work on projects that are going to contribute to the firm within weeks of being here," said Adam Nunes, part of the business development group at Hudson River Trading, a proprietary-trading shop of about 60 people.
Key to trading firms' appeal is their pay. A new high-frequency trading programmer with no advanced degree can expect to make between $75,000 to $95,000 in the first year, plus a bonus, which can add an additional 10% to 50%, according to Objective Paradigm, a recruiting company that works with proprietary-trading firms.
Tech firms generally pay about 10% less, Objective Paradigm said, but deferred compensation and options are incentives that could be worth more down the road.
"We'll just pay much more than the Googles and the Facebooks of the world," Chopper's Fernando said.
Spokesmen from Google and Facebook declined to comment.
Still, Silicon Valley firms hold the promise of a different lifestyle, which often features later hours not pegged to the market day and more potential for telecommuting, said Mary Voss, chief executive of Foxhunt Staffing, a Los Altos recruiting firm. And job candidates can be wary of taking a job that lands them outside the bubble of technology and social-media companies.
"It's easy to go from a Yahoo to a Google to a Facebook to a Twitter," Voss said. "It's harder to go from a high-frequency trading firm to a Twitter. That's something people take into consideration."
And students may not have even heard of the companies trying to woo them, even though high-frequency trading shops now make up roughly 56% of trading volume in US stocks, according to Tabb Group, a financial markets research group.
Being able "to go tell mom and dad you're going to work at a name-brand organisation is powerful," said Anthony Dostellio, managing director at Objective Paradigm.
Still, while trading firms don't always have the same buzz as a tech titan or start-up, the catered meals, plasma TVs and regular massages at some trading firms are helping lure more of the top talent, Dostellio said. After visiting trading firms, candidates "would come out of those environments and they would just be floored," he said.
Mark Stehlik, assistant dean for undergraduate education at Carnegie Mellon's School of Computer Science, notes that while trading and electronic market-making firms snap up only a fraction of graduating technology specialists, they have "definitely learned how to play the game."
Trading firms including Tradeworx, RGM Advisors and DRW Trading Group have all hired recent Carnegie Mellon computer-science grads, according to data from the school's career centre. "They understand high offers can attract good talent and are definitely in there swinging," said Stehlik.
Trading firms are even quietly persuading some technology specialists already employed in Silicon Valley to make the jump into finance. In 2010, Objective Paradigm helped its trading clients hire 30% more people than in the previous year who had been working at non-financial California companies, the company said.
Judging by the calibre of their newest employees, high-frequency trading firms say the recruiting is working. "We all joke we'd never get a job in our own company now," Fernando said.
Battle for tech geeks: Street vs. Silicon Valley