Sales and Trading

So what is sales and trading exactly? Many sales workers and traders work on the “sell side,” which refers to Wall Street investment banks that sell stocks, bonds, and other securities to the “buy side.” The buy side refers to the investment management firms, pension funds, hedge funds, and trusts that buy stocks, bonds, and other securities from the “sell side.” Outside the investment banking industry, traders work for hedge funds, brokerage firms, commercial banks, insurance companies, asset management firms, and mutual fund companies.

The most important function of a sales and trading department at an investment bank is, of course, to make money. An investment bank collects significant fees every time its sales and trading professionals execute a deal for clients. Traders and salespeople add incrementally to the bottom line through daily profits and losses and commissions, and raise the profile of the firm in the marketplace.

Opportunities for sales and trading professionals are available throughout the United States, but are best in New York City, where many investment banks, hedge funds, and other financial firms are located. The biggest investment banks include JPMorgan Chase, Goldman Sachs, BofA Securities, Morgan Stanley, Citigroup, Barclays, Deutsche Bank, UBS (including Credit Suisse, its recently purchased subsidiary), Centerview Partners, and Evercore. Leading hedge fund firms include Bridgewater Associates, AQR Capital Management, Man Group, Renaissance Technologies, Two Sigma, Millennium Management, Elliott Management, Baupost Group, BlackRock, Winton Group, Field Street Capital Management, Citadel Investment Group, Mariner Investment Group LLC, Ares Management, Balyasny Asset Management, Point72 Asset Management, and Rokos Capital Management.

For years, an MBA was strongly preferred for those seeking trading positions. The increasing popularity of automated trading has changed the required skill set and educational background for traders. As an alternative to an MBA, employers are seeking traders with degrees in financial engineering, quantitative finance, artificial intelligence, software development, and related fields. Sales professionals need at least a bachelor’s degree in business, marketing, sales, quantitative finance, finance, accounting, or economics from a top-tier college.

The increasing uses of automated trading and artificial intelligence (including machine learning) and decreasing revenues at investment banking firms have caused steep declines in the number of trading and other professionals at investment banks. In fact, 20 of the largest investment banks cut at least 61,905 jobs in 2023, according to calculations made by Financial Times. Despite this decline, there is still demand for traders who work with products that cannot easily be traded—such as illiquid products and bespoke over-the-counter financial products. Additionally, traders are needed to monitor automated trading systems to ensure that trading is conducted properly. There also will be strong demand for traders with programming and software development skills who can develop automated trading platforms (especially those that use artificial intelligence), as well as those with data analytics acumen. “In such a fast-paced and constantly evolving industry, programming skills are essential,” according to Medium.com. “Programming and trading go hand-in-hand, and a deep understanding of algorithms is crucial for keeping up with the accurate and efficient trading systems of today. By mastering programming, traders can develop their own algorithms tailored to their specific needs and gain a competitive edge in modern financial markets.” Opportunities for sales professionals will be better because there will always be a need for sales workers to explain financial products and trading strategies to investors.

Sales and trading professionals earn high salaries—although their salaries have been dropping for the last decade. Despite this trend, total compensation for sales and trading associates ranges from $150,000 to $240,000, according to WallStreetOasis.com. Higher-level professionals in investment banking—such as vice president ($170,000–$350,000), director/senior vice president ($350,000), and managing director ($1 million+)—have greater total earnings.