In an exclusive interview at Cass Business School, Anton Kreil, the Managing Partner of the Institute of Trading and Portfolio Management, delves into the intricacies of the trading world. Kreil, a former Goldman Sachs trader, discusses the current trends in financial markets, the future of banking and hedge funds, and offers career advice for aspiring traders. This article aims to distill key takeaways and lessons from Kreil’s candid conversation.
5 Key Takeaways
- Trading in Space: Kreil discusses an ambitious project to execute the first financial transaction in space, a feat that would be broadcast live on YouTube. The technology to achieve this exists, and the endeavor could attract significant sponsorship from trading platforms or corporate entities.
- Reality of Investment Banking: Kreil warns that investment banking is not the golden ticket it once was. New entrants are essentially contractors for the first two years, with low pay and uncertain career prospects.
- Hedge Funds as the New Frontier: According to Kreil, hedge funds offer the best opportunities for traders to make significant earnings. He advises young traders to gain experience in investment banking but to aim for a transition to hedge funds as quickly as possible.
- Emerging and Frontier Markets: Kreil suggests that young traders should consider moving to emerging or frontier markets after gaining initial experience. These markets offer untapped opportunities and less competition.
- Self-Interest and Objectivity: Kreil emphasizes the importance of maintaining one’s career objectives and not getting seduced by relative measures of success. He advises traders to be self-interested and objective in their career choices.
The First Trade in Space
Kreil opens with a fascinating project: executing the first financial transaction in space. The technology for this exists, and the event would be broadcast live on YouTube. This endeavor could attract significant sponsorship, either from trading platforms or corporate entities. The trade could be either a currency pair or a specific stock, depending on the sponsor. The idea is not just a publicity stunt; it represents the limitless possibilities in the trading world today.
The Diminished Allure of Investment Banking
Kreil paints a less-than-rosy picture of investment banking. He warns that new entrants are essentially contractors for the first two years, often earning less per hour than a McDonald’s employee. The career prospects are uncertain, and only a small percentage of entrants make it past the initial years. This section serves as a reality check for those who view investment banking as a fast track to wealth.
Hedge Funds: The Promised Land?
According to Kreil, hedge funds are where the real opportunities lie. He advises young traders to aim for a transition to hedge funds as quickly as possible after gaining initial experience in investment banking. Hedge funds offer the potential for significant earnings and are the new frontier for traders seeking to make their mark.
The Untapped Potential of Emerging Markets
Kreil suggests that young traders should consider moving to emerging or frontier markets. These markets offer untapped opportunities and less competition. The idea is to go where the action is, but where the competition isn’t as fierce. This could be a strategic move for those looking to fast-track their careers.
The Importance of Self-Interest and Objectivity
Kreil closes by emphasizing the importance of maintaining one’s career objectives. He warns against getting seduced by relative measures of success, such as comparing one’s salary to the national average. The key is to be self-interested and objective, focusing on long-term career goals rather than short-term gains.
Lessons Learned
- Be Realistic: Understand the limitations and challenges of the trading industry, especially in investment banking.
- Be Strategic: Consider hedge funds and emerging markets as viable career paths.
- Be Self-Interested: Keep your career objectives in focus and don’t get sidetracked by relative measures of success.
Final Thoughts
Anton Kreil‘s candid insights serve as a valuable guide for anyone considering a career in trading. While the allure of investment banking has diminished, opportunities in hedge funds and emerging markets are promising. Above all, maintaining a sense of self-interest and objectivity can serve traders well in navigating the complex landscape of financial markets.
Source: YouTube Video – ex Goldman Sachs Trader Tells Truth about Trading – Part 6
Note: The views and opinions expressed in this article are those of Anton Kreil and do not necessarily reflect the views of any financial institution.
