Mike,
I’m reading your book – One Good Trade – for the second time. In Chapter 3 you describe how your firm selects candidates and how much this process is inadequite. Why don’t you just let people papertrade (remotely from home) with your platform and see who does best?
I understand your concern trying to select person with the best persona. But as you can see it is not possible to reveal what a person is really like in such short period of time, nor it has significant enough correlation with his trading performance.
You wrote that “Steve likes everyone”… I think he just knows that you are doing a blind guess and even the best candidates can turn out to be the worst traders and vica versa.
To give you an additional view from a candidates viewpoint: after I left University (experiencing a ton of injustice) I told myself: “I’m sick of being judged by other people, I will find a job where I’m NOT a subject of their opinion.” So I found trading. It’s an excillent field to compete with no opinion of others. And what do you do at these interviews? Judge people by who their favorite athlete is. GIVE ME A BREAK! Give us some basic instructions, put us on demo and let us trade!
About a year ago I was at an interview at (deleted) Group. They called me back like 4 times (had to travel hours each time). And in the end they told me they ALMOST hired me but someone else got a bit higher scores in their stupid games. Result? The Budapest branch closed a few months later. (Now we have ZERO prop trading firms in Hungary)
If you know the selection process s#cks (do you think it could be any much worse if you selected candidates randomly? 1 out of 10 people is going to be good?) why don’t you do something about it? Why don’t you change the whole selection process?
Hope I could make a valid point without getting too much on your nerves! 😉
Yours sincerely:
George.
ps: wish me luck as I’m going for an interview to Cyprus.
——————————————-
Bella
1. What makes you think trading is an activity where you are not judged?
I was teaching a class in Austin for the Kershner Trading Group on Tuesday, forgot I left two DDD buy orders in without stops, and the market judged that as stupid. 1k stupid to be exact.
I held my sticky key down on the same day locking my keyboard and couldn’t exit save by telling the pit boss for an extra 30c of extra loss. The market judged me as sloppy for such a misstep. $300 sloppy to be more precise.
I made a Trend Trend Trade short with Tier 3 size from 14.50 to 13 yesterday in $GOGO. The market judged me as brilliant in this excellent R/R trade.
2. Hiring anyone who wanted a seat would be a horrible idea. Culture is important to us. Those who do not embrace the value of getting better everyday will not fit in. They might harm the culture for the guys we want. Using resources on bad fits takes away from what we can do for the traders best for our firm.
Moreover we have found those with a demonstrable passion for trading or a history of accomplishment/competitiveness have a higher success rate. This is best shown from past trading records. As I wrote in The PlayBook, when you interview at a prop firm drop a file of past trading on them to improve your chances of being hired. It is best for our firm to hire and train these candidates.
3. We don’t want to just work with anyone. We spend ten hours a day with our traders. We want to spend our day with elite performers whose company we enjoy.
4. The future of trading in our estimation if for discretionary traders to be bionic and build automated strategies to play more offense. Â That requires a firm with traders willing to grow. Â We spend a great deal of effort searching for people with that mindset.
I hope that helps.
***Is the reader above right? Â Share your thoughts with us.
You can be better tomorrow than you are today!
Mike Bellafiore is the Co-Founder of SMB Capital and SMBU, which provides trading education in stocks, and options. Bella is the author of One Good Trade and The PlayBook.
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6 Comments on “Give Me a Break SMB”
I have been in similar situations as the reader who posed this question and i know how frustrating it can be, Best thing one could do is accept one has to rely only on oneself, get a job for sustenance and trade live even if the risk capital is less. The only answer is time , probability is high (those with +ve expectancy methods & experience who fail to break through in one of the prop firms) to transition from job+trading towards trading full time via perhaps arcade or starting one’s own firm.
There can be a gestation period of couple of years into such a transition but it is doable.
Is not just hiring anyone. Anyone could blow up your entire firm. Trading is serious business.
My problem is you guys hire people with NO skin in the game. Instead of hiring people that buy your products who have at least some experience and already show a passion. You instead focus your time on college students that are going to learn from you and leave your firm for a better deal once they become proficient.
We are open to hiring those who are trained by SMBU. SMB Options does from those who are members of the Options Tribe. We certainly have as well on the equities side.
Bella – thanks for posting this. I got a good chuckle. ANYONE can be a Rock Star on the demo. Too funny. As far as George questioning your process in selecting candidates – It’s YOUR process, it’s YOUR business, it’s YOUR capital at risk and if you want to hire only left-handed plumbers who work every other Sunday – that’s YOUR prerogative. Keep up the good work!
Dear George,
If I am interpreting your frustrations correctly, and please
forgive me if not, I understand your frustration with being unfairly judged.
But if I may suggest, please be careful not to become like those who you despise.
Are you not at this moment, perhaps, unfairly judging SMB? I will assume you
want to be judge on your merits, or at least a fair appraisal of your abilities
and be rewarded accordingly? If so, I
would think SMB deserves a fair appraisal of their process. It may not be a perfect
process, but is there a firm that has one? Look at the firm that unfairly
appraised you in your opinion; aren’t they out of business? However, SMB still thrives today!
I think the real break you need is a change of attitude. I
apologize in advance if that sentence comes off overly direct from a stranger.
But remember in trading Mr. Market will not be so kind to us. Experience tells
us that paper trading alone doesn’t guarantee anything. But Mike, and Steve’s
experience tells us that a person with the right attitude can go a lot further
than the greatest paper trader, or real trader alive, who has an attitude that
is horrible for their culture. If I was a hiring manager, your attitude would
be the first thing that bleeds through your email. Red flag! I am sure you have
potential, and drive to be the best. But don’t let those who have judged you
harshly in the past continue to live through your attitude. Let the pain go,
and humility will take you a long way. I wish you the best, and hope you will
get the success in trading your abilities deserve.