This is totally awesome, mainly because prop traders are something a lot of people talk about, but few people really know about. Here, one London quant sits down and takes you through his job which, in this industry, is life , step-by-step.

The interview is from a must-read column in The Guardian by Joris Luyendijk called " Banking Blog: Going native in the world of finance. In this installment, Lauyendijk introduces his readers to "an inconspicuous-looking man, originally from continental Europe.

He orders a vegetarian pasta and sparkling water.

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The 'pure' prop traders have a view on the market that day and act on that. I will have an idea about a pattern in the market , say, if the share price of two English banks with a broadly similar outlook diverge, they will most likely converge again very soon Or I might look at the ways unusual rainfall in Argentina translates into higher wheat prices.

Next is statistical analysis I would never consciously try to raise the price of, say, rice, and starve children in China. Quite apart from the morals, it is actually very difficult to make a profit out of that.

You drive up the price of something by buying more and more of it. The thing is, players in the market are going to notice that.

And so they will quote rapidly higher prices to you since they realise that you want to buy a large chunk of the overall market with all your money. It is absolutely forbidden to do a quick in-and-out when you've pushed up the price yourself. It's called price manipulation and regulators are really strict about that, you get sanctioned even if it happened by mistake and was really unintentional.

Well, hedge funds work with other people's money, and they can suddenly go into a panic and take their money out. That kind of thing can really wreck your strategy.

This bonus can dwarf my salary and be multiples higher.

Proprietary Trading Careers:

In this business you can exactly pinpoint profits, and people like me get paid roughly a percentage of those profits. And his parting words?

He works really hard, and most of that work in his life has been dedicated to getting to where he is now — and that has made him humble. I can't sing, paint or play any instrument.

But give me some time and I'll work on it. That we'd have to see. Tech market is nowhere near the dotcom days. How augmented reality is changing the way we work. You are using an outdated version of Internet Explorer. For security reasons you should upgrade your browser. Please go to Windows Updates and install the latest version.

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Trending Tech Insider Finance Politics Strategy Life Sports Video All. You have successfully emailed the post. A Prop Trader Explains His Work, His Salary, And Why Everyone Is Wrong About His Profession. AP This is totally awesome, mainly because prop traders are something a lot of people talk about, but few people really know about.

On how he does his job: Traders The Guardian Banks The City. Recommended For You Powered by Sailthru. A Prop Trader Explains His Work, His Salary, And Why Everyone Is Wrong About His Profession A Prop Trader Explains His Work, His Salary, And Why Everyone Is Wrong About His Profession A cautious quant.

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