Sales and Trading

Sales and trading professionals work for investment banks, hedge funds, securities firms, brokerage firms, commercial banks, insurance companies, asset management firms, and mutual fund companies.

The U.S. investment banking industry includes about 4,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $105 billion in 2021, according to Dun & Bradstreet. Worldwide, investment banks generated $132 billion in revenue in 2021. Investment banks in Canada, Europe (especially the United Kingdom), and Asia (especially China and Japan) also are key players in the industry. Approximately 45 percent of U.S. investment banking revenue comes from brokerage and securities services, 30 percent from trading, and 25 percent from asset management and financial planning. According to Statista.com, the leading investment banks (by global revenue) worldwide were (as of November 2022):

1. JPMorgan Chase: $5.37 billion
2. Goldman Sachs: $5.24 billion
3. Bank of America Securities: $3.70 billion
4. Morgan Stanley: $3.60 billion
5. Citi: $2.79 billion
6. Barclays: $2.13 billion
7. Credit Suisse (which is now a subsidiary of UBS): $1.70 billion
8. Jeffries: $1.52 billion
9. Deutsche Bank: $1.29 billion
10. RBC Capital Markets: $1.23 billion

There were about 17,378 hedge funds in the world in 2020, according to alternatives data provider Preqin, although this number changes constantly as new funds open and exiting funds close. In Quarter I, 2022, there were 9,628 hedge funds in the United States, according to the Securities and Exchange Commission. Hedge fund firms controlled $3.83 trillion in assets in 2022, according to Hedge Fund Research. This was a decrease from $4.01 trillion at the end of 2021, but up from only $1.5 trillion in managed assets in 2006. The Financial Times reports that investors are being cautious about where they invest their money, sticking with big fund firms that promise more stability. This suggests that the number of new hedge funds may grow more slowly than it had in the past. In 2022, a total of 435 new hedge funds launched, according to Hedge Fund Research, down from 735 in 2017 and 1,040 in 2014. These figures are much lower than the peak of 2,073 funds created in 2005. Growing competition for investment capital and rising investor demand for transparency and cost/fee restructuring are causing some finance professionals to think twice about starting new funds.

Statista.com reported that the 10 largest hedge fund firms by assets under management in the world were (as of June 2023):

1. Field Street Capital Management
2. Citadel Investment Group
3. Bridgewater Associates
4. Mariner Investment Group LLC
5. Millennium Capital Partners
6. Ares Management
7. Balyasny Asset Management
8. AQR Capital Management
9. Point72 Asset Management
10. Rokos Capital Management

The securities industry employed nearly 1.2 million workers in January 2024, according to the U.S. Department of Labor. This employment total includes workers in every type of career—from accountants and lawyers, to financial analysts and researchers, to sales and trading professionals. Approximately 30 percent of securities industry employees work in the greater New York City metropolitan area, a region covering New York, New Jersey, and southwestern Connecticut. Many of the largest U.S. companies have offices in foreign countries.

Salaries and bonuses are excellent for sales and trading professionals—although they have declined over the past decade. 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 higher total earnings.

Many noteworthy professional organizations serve sales and trading professionals and others working in the investment banking, commercial banking, hedge fund, mutual fund, and securities industries, including:

• The Alternative Investment Management Association offers certification, continuing education, and other resources to its members (hedge fund managers, fund of hedge fund managers, prime brokers, fund administrators, independent fund directors, etc.). Its membership comprises about 2,100 firms in 60+ countries. Its fund manager members collectively oversee more than $2.5 trillion in hedge fund and private credit assets.
• The American Bankers Association represents the nation’s banking industry, which is composed of small, regional and large banks. Its members employ 2 million women and men, hold $23.8 trillion in assets, safeguard $17.2 trillion in deposits, and extend $11.2 trillion in loans. It provides extensive continuing-education programs and publishes the ABA Banking Journal.
• The CFA Institute offers certification and continuing education opportunities. It has more than 190,000 members in 160 markets around the globe.
• The Chartered Alternate Investment Analyst Association provides a well-respected continuing education program and certification. It offers a podcast, a blog, and various publications.
• The CMT Association is a nonprofit professional regulatory organization of more than 4,500 market analysis professionals in more than 135 countries. It provides certification, publications, the “Fill the Gap” podcast, and continuing education opportunities.
• The FIA is a major trade organization for the futures, options, and cleared swaps markets industry worldwide.
• The Hedge Fund Association is an “international not for profit industry trade and nonpartisan lobbying organization devoted to advancing transparency, development, and trust in alternative investments.” Members hail from the hedge fund, private equity, venture capital, real estate and wealth management, private banking, and other sectors.
• The International Association for Quantitative Finance offers membership for both college students and professionals. Its Web site provides useful education and job-search resources. The association offers a variety of resources for students, including an overview of financial engineering, a list of colleges and universities that offer training in the field, and resume and interview tips.
• The Investments & Wealth Institute provides certification, continuing education, publications, and other resources to its members, which include investment consultants and analysts, accountants, and others who provide financial services and advice to corporations, individuals, nonprofits, and retirement/pension plans.
• The Investment Company Institute is a “leading global association of regulated funds, including mutual funds, exchange-traded funds, closed-end funds, and unit investment trusts in the United States and similar funds offered to investors in jurisdictions worldwide.” Its members manage total assets of $29.7 trillion in the United States, serve more than 100 million investors, and manage an additional $8.1 trillion in assets outside the United States. The institute offers continuing-education opportunities and publishes the Investment Company Fact Book.
• The Managed Funds Association is a membership organization for hedge fund managers and related professionals. Its more than 160 member firms collectively manage over $2 trillion across a diverse group of investment strategies.
• The National Futures Association is the self-regulatory organization for the U.S. derivatives industry, including retail off-exchange foreign currency, on-exchange traded futures, and OTC derivatives (swaps). The association offers year-round paid internships in its Futures Compliance, Swaps Compliance, and Market Regulation departments.
• The National Investment Banking Association, which was founded in 1982, represents the interests of the micro-cap and small-cap investment community. Its member firms have a track record of “successfully completing thousands of transactions totaling over $40 billion in new capital for emerging growth companies and are responsible for 90 percent of all IPOs under $20 million.” It offers a Conference Internship Program.
• The Securities Industry and Financial Markets Association represents the interests of securities firms, banks, and asset managers. Its broker-dealer members “comprise 80 percent of U.S. market share by revenues and 70 percent of financial advisors managing $18 trillion of client assets” [and its] “asset management members manage more than 50 percent of global AUM.” It also offers the following professional societies for individual members: Compliance and Legal Society and the Financial Management Society.
• The Security Traders Association is a “grassroots organization comprised of more than 20 affiliates in the U.S. and Canada; STA members represent individuals employed in the financial services industry across varying business models.”
• Women in ETFs is a nonprofit organization for both women and men who work with exchange-traded funds. It has more than 10,000 members in chapters in major financial centers across the United States, Canada, Europe, Middle East, Africa, and Asia Pacific.