From Curiosity to Collaboration: The Journey of a Quantitative Trading Analyst at DRW

A Quantitative Trading Analyst (QTA) applies mathematical and quantitative methods to manage risks and create optimal trading and investment strategies. At DRW, this role requires collaboration with experienced traders, software engineers and quantitative researchers to appropriately analyze the markets.

For example, through their interaction with the market, a trader might identify a possible revenue generating opportunity. A QTA’s job might be to investigate and test whether such an opportunity exists and under what regimes (e.g. through data analysis, model building and back testing). Should the trade pass this test, the QTA would likely work further with software engineers and quantitative researchers to enable the trader to trade this idea.

But what does it take to get into this career at DRW? This article will highlight our hiring process and what we are looking for in qualified candidates.

What are we are looking for?

Trading is all about finding patterns and irregularities and reacting to those findings, so the number one quality to be a successful quant trader is being curious. Having a problem-solving skillset with a proactive attitude will take you very far in the world of trading. Other key skills include:

Quantitative Skills: Trading requires a good grasp of math, particularly probability. While you will not be doing degree level work every day, there will certainly be times when you’ll need a quantitative mindset when making a new model or reading the latest academic research.

Programming & Computer Science Skills: The modern trading desk is awash with data and programming and it is your responsibility to help make sense of it; this applies across the spectrum from the entirely systematic to high human touch desks. Not sure which programming language to choose? Try Python – it is relatively easy to start with but is still powerful enough to be very useful. It is widely used at DRW and is rich in features for data analysis and statistical research. Try and get familiar with the pandas, numpy and scipy libraries. Kaggle is also a great place to practice python at the same time as honing your data science skills.

Passion for Markets/Finance: Take it upon yourself to develop a deep understanding of the markets and the products that DRW trades. There are plenty of books out there to sink your teeth into. If you are a beginner, “The Money Machine: How the City Works” by Philip Coggan is a good introduction to finance. If looking for a more technical description of some of the products and ideas, “Options, Futures and Other Derivatives” by John Hull is a good place to start! Ensuring that you comprehend financial terms and stay up to date with financial news is essential.

Risk-taking Ability: As a trader you’ll be making many decisions every day about taking and managing risk. This is difficult to practice outside of actually working on a trading floor, but activities like simulated poker and betting help. Better yet, try to invest your own portfolio online. If you don’t have the funds available, there are plenty of sites where you can “paper trade” with fake money.

Communication and Teamwork: When joining a trading desk, you’ll be joining a team of colleagues with a common goal and effective collaboration is essential. You’ll need excellent communication and interpersonal skills to be able to manage relationships both within and outside of the firm. Should you possess these skills, you have a great chance of making it through our interview process!

What can a QTA expect in their first year?

The QTA role is at the intersection of all the action. To give you an idea, in your first year you can expect the following:

• An orientation providing a broad introduction of the various products DRW trades including their theoretical underpinnings.
• To gain familiarity with the specifics of your desk’s product and understand the technology and machinery required to run your trading desk.
• To contribute to existing risk management systems and/or make new ones for new features of the markets.
• Research a new trading idea and create a model to trade it.
• Depending on the desk, you will begin to trade and take risk yourself.

The Interview Process

While interviewing, you’ll gain insight into our business and understand how we contribute to the financial markets. Most importantly, you’ll meet the people at DRW and hear firsthand from potential future team members on where a career can lead. The steps of our interview process are as follows:

1. The first step of the interview process starts with a quantitative challenge. This assessment is designed to test a candidate’s logical and quantitative skills and can be done from home. Check out a sample question here.
2. Candidates who successfully complete the quantitative challenge are invited for a Zoom interview. This part of the interview involves testing one’s probability and statistics knowledge. Interviews typically take about 45 minutes, so candidates should allow enough time in their schedule. One should be in a quiet place, alone and prepared with questions!
3. After successfully completing the virtual screening, candidates are invited for an in-person “Superday”, where they will complete a quantitative coding challenge using Python, and participate in a trading simulation. They will also have multiple technical interviews and opportunities to interact with our team in a more casual setting.

Think you have what it takes to join our team? Click here to see our current job openings.