Quant shops paying $600k out of college?
Heard a rumor that quant places were paying $600k+ for the ‘best’ talent out of college. Is that true?
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Yup
Not a rumour
You need to be "The Best" for 450k+ offers
What does “the best” mean? Have some sort of trading algorithm or IP they’ve created themselves?
No…? at least not necessarily. It’s mostly the quant trading roles that get this high out of ug, not so much SWE (but outsized junior comp is still possible here)
Shops like Citsec and Jane street pay close to that anyway, they’re considered the top firms so naturally you could equate the best talent going there (you’d be generalising a lot). Another way to get to those numbers and possibly higher is by having multiple offers from multiple shops and stacking them.
Naah, but you need to have sharp mathematics and analysis overall along with some IVY league degree in Math or Physics or CS
No. We don't care about an existing algo that a top candidate have. Here's the typical profile of that:
- High school national/international math competition (IMOs). At my past place, we had a number of people won silver/gold medals in those competitions.
- Undergrad putnam. Same as above.
- Quant-heavy Ivy League/Targets.
Essentially math prodigy was our type. They can create strategy from scratch once they join the firm, where they learn how to do it properly.
Just big brain and stats knowledge.
Probably true for the Good Will Hunting types
Yes, and also the NBA and NFL sports teams are paying up to $10 million for the "best" talent out of college. It's true. It does happen for a handful of people each year. But just don't expect that it will happen to you or anyone you personally know.
In all seriousness -- getting paid that much in your *second* year (or even in your first year as a higher bonus that wasn't guaranteed in your contract) is possible cause then the company is able to evaluate your work and know you're worth it. But to get $600k *guaranteed* straight out of undergrad before you start the job with no track record? Maybe it happened for somebody somewhere; but that's a lot of money for a company to spend on an unknown quantity with no track record. Even if you're an undeniable genius who won the international math olympiad or whatever, there's lots of people like that who fail miserably at trading. For most undergraduates, I think top companies might *guarantee* a maximum of say $400k at the very high end and even that's only for the best. (Though if you overperform, then sure, they might give you much higher than that in bonus, it just wouldn't be guaranteed in the offer.)
But again, that's for the best of the best. For mere mortals, most undergrads at even top-tier shops should be expecting more like $200k, maybe $300k if they're very good. And even less for second-tier shops.
EDIT: Several people have pointed out there maybe be a one-time-only signing bonus too. I'm not including that in the above numbers, just the recurring numbers.
That's a fair analogy and your elaboration makes sense to me. $650k for someone with essentially 0 on the job experience seemed extreme but the conditions you've outlined make sense.
Funny, at the start of this thread you were quoting $600k but now a day later, you've raised it to $650k. Man, inflation is really increasing fast! :-)
i've heard of people from Jane Street / Optiver / HRT making 600k+ their first year out of college
Sure, i said the same thing in my post. Just with caveats about it being not guaranteed. Also, as others have pointed out, it's really not fair to include a signing bonus in that number since it's not recurring.
Standard offers (no negotiation) for SWE and quant traders are 350k to 450k in NYC/Chicago among top firms. 200k (even Roblox pay 240k) is literally what tech pays, top firms must and do pay more. 600k is indeed extremely rare even among top firms and requires multiple offers for quant from Citadel, Radix, HRT etc...
Roblox pays 145k in SF (source: my friend who works there). Your information is just wrong.
Need to be specific on what 600k means. If that includes signing bonus, that doesn't recur and isn't included in the baseline for next year's comp.
Close buddy of mine since HS got a gig at one of those firms. He's an absolute genius, top in the US physics and math Olympiad and took multi var at a local college during his junior year of HS. Went to a very top west coast school for CS and Physics with offers from UChi/Princeton he turned down. He's also the type who doesn't study and just "gets it" we played video games past midnight all day in HS and he still was crushing it. Offer is low 500s I’ve heard and there’s at least 5-6 rounds of interviews
Sounds about right for a caltech grad
Top shops will pay 300k/year + a one time signing bonus of ~150k. Sometimes that signing bonus is bigger or smaller depending on the firm. So both yes and no. Kids are not getting 600k/year contracts, but they are making solid money at a young age.
This sounds about right from the info I've sourced elsewhere.
Is this just strictly for quant roles or do DE Shaw strategy/business dev new hires get paid similar money?
The only way you make the kind of money being talked about in this thread at a quant shop is for….. surprise, surprise….. being a quant. Seriously though at almost any age in finance you need to be in a P&L role in order for them to justify paying you like that, and BD and Strategy are not. That said, whatever the market for those sorts of roles are, they will probably pay similar to their tech counterparts.
My firm's (pre-negotiation) QR offers this year were 500k base+guaranteed-bonus + 100k signon. Bonus will grow, so yes it's a 600k contract.
Citadel (Securities)?
It depends. Quant shops have tiers.
Tier SSS:
HRT, 500k - 2.4M out of undergrad (Usually 300k-500k is in the initial offer letter, and there is a gigantic year-end bonus that is not written in the offer letter but is likely to be in the ballpark of 500k -1.8M)
Here 600k is for under-performing ones.
Tier SS:
Jane Street, De Shaw, Citadel Securities
300k - 800k out of undergrad
600k is very likely.
Tier S:
1. Citadel (Citadel is different from Citadel Securities)
300k - 700k, bad culture and bad work life balance is why it’s not Tier SS
2. Akuna Capital, Optiver, Jump Trading, DRW, IMC, these are 200k - 450k out of undergrad,
Have to wait for 2-5 years to reach 600k at these places.
Tier A
Chicago Trading Company, Two Sigma, Bridgewater, 150k - 250k out of undergrad
600k very unlikely, only for extreme outliers
Tier B
Blackrock, Bloomberg, 150k - 200k out of undergrad
600k is out of picture for new grads
Tier C
1. MBB consulting quant branch (they do have it)
2. Investment bank desk quant in S&T
100k -170k out of undergrad
Can only reach 600k after 6-10 years
Tier Shit
Investment bank back office quant (essentially IT support), 85k - 150k out of undergrad
Don’t dream about 600k
So it really depends on which tier of quant you are talking about. The anecdotes that previous comments mentioned are mostly for Tier SS and Tier S.
Remember, the top quant shops ( Tier S+ ) only hires absolutely TOP talent in math / programming. A lot of people who aim to become quants end up in Tier C and Tier Shit.
Don't know if you can really compare hedge funds with market makers. Typically funds will pay less than MMs starting out but a successful PM at a good hf will out earn a successful market maker 9/10 times. Sort of different risk profile, so not sure I'd agree with having them on the same "tier" list.
This is GOAT Lol. Agree that most of wannabe quants who pursue MFE end up in Tier C and Tier Shit. They have a ceiling since they don't take active risks nor linked to the trading desk PNL.
DIdin't have a clue that HRT pays that outrageously though.
Yeah it looks legit its the same on levels.fyi. Although those entries were from 2020-21 when there was extreme market volatility so was definitely possible for some people to perform well and make a killing.
HRT thrives in economic recession because of volatile markets.
Noob math undergrad here, is a PhD that much better than MFE/MSQF? And if so, what PhD track? Also if so, would a MFE program from a good school (UC Berkeley, Ivy League, etc.) be equal/worse than a PhD say from a less prestigious school (Rice, Duke, NYU)? Interested to hear your thoughts.
Jump deserves to be in tier SS. They pay just below Jane Street but still much higher than everything else minus Citadel in Tier S. Equal pay with optiver but higher talent.
Left out a bunch like pdt, old mission, radix, headlands that all pay higher than jane street and on par with hrt too. Virtu isn't bad either. Would put them in Tier B but if you were ranking it by pay Two Sigma and Virtu do give > 300k first year.
Industry veteran here who has worked at 2 of the top-tier shops you named and had offers from several of the others. I have actually hired people straight out of undergrad and decided their comp numbers so I'm pretty sure I know what i'm talking about.
All I can say is that even at the very top-shops, if you seriously think that for first year hires straight out of undergrad that "600k is for under-performing ones" or even "very likely" then you're going to be disappointed at bonus time. Yes, those numbers can happen for a small handful of people. But even at the very top shops, it's NOT the norm for a first year straight out of undergrad.
I’m not really counting the stub-year (the immediate six months after graduation) when these grads are going through training, getting acquainted, etc. I’m referring to the first full-productive year (age 23)
What tier does WorldQuant fall into in the above?
Just a note, the levels.fyi page for HRT is highly inaccurate due fake posts. New grad comp this year was ~500k for algo dev (QR) and ~400k for SWE due to a terrible quarter they had, so comp didn't really increase.
How to know this is dubious undergrad speculation: HRT primarily pays quarterly bonuses, not a "massive year end bonus"
I thought they do announce the bonus number annually, but just pay it out quarterly over a couple years? You actually get a "surprise, here's your bonus number" each quarter? It's a lot of work for managers to allocate bonuses to their team, and a lot of emotion (and threats to quit) when people get numbers they don't like. It's already rough to go through that even just once a year -- does HRT really go through that 4x a year?
what is the economics/ business structure/ business model of quant firms that allows them to pay such insane numbers? surely the greatest (or most profitable, at least) business structure in all of finance, yes? $600k is what, probs the best paying entry job in the world? And the crazy thing is, for these legit top talent geniuses, quant stuff is just a cake walk for them, their job is probs just a minimal fraction of their brainpower compared to the physics and pure math they did, so they're essentially chilling in their jobs
In one word, prop trading. That’s the essence. These companies don’t really have clients, they have their own massive pools of capital (in billions or even trillions of dollar), and these capital are managed by a distributed computer system that strictly follow algorithmic instructions in the form of computer codes. There are two types of roles, 1. The people who design the algorithm, 2. The people who reduce system latency. Both of them make billions for the firm and take home millions
3 follow-up questions:
1) So prop trading is basically the most profitable/ best business in all of finance, yes? But building on that, not all prop trading is created equal. Investment bank traders do some prop trading too when they're not busy doing market making, however they are obviously not even close to the same level as quant prop traders. Regular S&T traders/ 'normal traders' probs have a finance degree, quant traders won the math olympiad and has a physics PhD. So not all prop trading is created equal, but how you prop trade makes the difference, correct? If u have the pedigree to quant trade, then u are the best business in all of finance
2) If quant shops dont have clients, how do they raise their capital? Maybe it's a family office managing the founder's personal assets? Citadel & Renaissance dont have clients?
3) Outside of the 2 quant roles u mentioned, aren't there purely execution traders around? I guess those would be paid way less, paid to the same degree as many other regular execution trader at let say a LO mutual fund, correct? Any upside to being an execution trader at a quant shop?
Ah yes, I forgot that prop shops have higher internal capital than blackrock does AUM
As a note - the below comments on this are mostly outright false and the remainder are speculative at best. For a student interested in getting into the space, I'd encourage double checking these comments before making any decisions on it.
This is pretty far off. Most places (pretty much all) won't give more than contractual bonus your first year unless you really add value, which is unlikely since most new grads join halfway through the year and spend the first few months being unproductive (especially at any trader driven places, like JS, or certain other places like Jump and DE shaw that take a little longer to ramp up new grads). Getting 600k as a new grad at these (S tier +) places is an outlier outcome even with markets the way they are.
Also tiers are dumb.
For the first year they usually have a massive sign-on bonus (100k-200k) on top of their 300k ish base, the sign-on bonus is essentially the first-year’s stub bonus that’s paid ahead of time to compensate for the lack of PnL first year. Some people think sign-on bonus shouldn’t be counted in compensation since it’s not re-occurring, but in fact it will re-occur in later years only in a different form ( the year-end bonus ) so their comp won’t fall off the cliff after the first year
Non Olympiad kid at my school in a frat math econ cs major w sophomore prop internship landed JS and is getting 400k+ (top 10 school)
very nice, ok.
Yes, it's possible, but the bar is extremely high. A lot of these shops higher less than 1/100 candidates that apply.
Del
Fuck you
People don't call you a virgin cause you work at a quant firm people call you a virgin cause you fuckin act like one
.
How insecure are you that you need your paycheck to make you feel good about yourself. You’re such a virgin. You sound like the kind of guy who has a sugarbaby cause what else you got bro.
Who the fuck cares about algebra. Great party trick lol.
Isn’t IB literally just about money “bro”, don’t act like you do charity work or something. You guys feel offended because you work longer hours for lower pay, I get it.
edit: clearly the guys getting paid 600k out of college care about algebra. just admit all you know how to do is change font colors and bring your boss some coffee and move on
Are there any quant roles that pay this well at non-quant shops? Places like Millenium, P72, have plenty of job openings for quants.
Dude, I would say avoid P72 like the plague. They don’t pay well as other quant firms and also have terrible wlb. Also, they have a bunch of shady practices because, well, just look at the CEO. There are much better firms out there.
Ive heard good things about Millenium, especially if you are a PM and run your book well, but obviously super hard to land one of these positions - definitely need some good experience.
millennium and P72 are both reputable pod shops, there's not much distinction between them at firm level (other than infra, which is probably better at P72)...
It's quite evident to me that many roles in the finance world are paying much, much more than 600k, specifically in pure analyst roles at high-performing hedge funds, but these roles are never talked about because you basically need a healthy dose of nepotism/connections to stand any sort of chance, even though they are about the same difficulty as quant firms to get in. Difference is, quant firms are completely meritocratic in their hiring. So something like a Jane Street role imo is overhyped only because it is high-paying + semi-realistic to land, but no one talks about the hedge fund analysts in their mid 20s pulling mid 7 figures.
I think a lot of it is this forum has an outsized focus on campus hire first year comp and many people have the impression that top prop firms hire more undergrads while many top hedge funds hire more people with a few years of experience. Are you implying that there are many people who become analysts at hedge funds straight from undergrad and after 3-4 years make more than 3 million or so? There are also certainly a lot more people at prop firms with 3-5 years of experience making 7 figures than undergrads immediately making 600k (although everyone seems to have their own different definition of starting comp). Depending on your definition of mid 7 figures (3 or 5 million?) that may also be rare in prop trading.
No mid 20s HF analysts pull in mid 7 figs afaik. What kinds of funds? Analysts that age can reasonably only be at the fund for max 2-5 years
If you aren't risk taking you probably can't, but you can absolutely pull 7 figures in a hedge fund in your mid 20s. Most common way for this to happen though would be analyst -> junior PM.
It is definitely an outlier and NOT common, but my wife pulled in mid 7 figures before 30 at a HF. It happens, but you need to be crushing it.
I am in this situation. Feel free to dm.
All without negotiation? Were you able to negotiate any of them to a higher amount?
Kid a couple years ago from H got 350 with a 650 signing bonus but was an IMO gold medalist. If there’s even a possibility of you getting paid that much, you’d already know it by the time you stepped foot on campus. His gift was God given though.
you guys are lucky to be good at math!!
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