How does a trading desk make money?

Trading desks generate an income by charging a commission on trades they transact. For example, a hedge fund may deal through an equity trading desk at an investment bank and pay a modest fee for each trade. In some cases, brokers may operate their own trading desk by being the counterparty for their client’s trades.

How do investment bank traders make money?

Proprietary trading is an effort to make profits by trading the firm’s own capital. Investment banks earn commissions and fees on underwriting new issues of securities via bond offerings or stock IPOs. Investment banks often serve as asset managers for their clients as well.

What is a desk at an investment bank?

A trading desk is a designated area of a bank, investment firm, or trading floor dedicated to the sale and purchase of specific types of products. Many institutions have separate trading desks for the forex, fixed income, commodities, and equities markets. Some institutions may further subdivide the different markets.

What is a rate trading desk?

What is the Rates Trading Desk? Of those, we focus on making markets in sovereign bonds and interest rate derivatives. Sovereign bonds are ones issued by governments, such as U.K. Gilts, U.S. Treasuries, EUR-denominated bonds issued by European countries, and Australian Government Bonds (AGBs).

How are Wall Street bonuses calculated?

A: Banks establish a companywide bonus pool, which is usually some percentage of revenue and profit, said David Wise, a compensation consultant with Hay Group. Different groups within the bank then get a portion of that pool, based on their contribution to profitability over the course of the year.

How do you get a trading desk?

The easiest way to get access to a Wall Street firm trading desk—the department where securities transactions take place—is to apply to an investment bank or brokerage. Begin with an entry-level position like an assistant to a stock analyst or trader and learn everything you can.

What do trading desk operations do?

Our TDO Specialists are integral to the firm’s success, building and maintaining desk infrastructure that is responsible for trading thousands of financial products across 200 trading venues around the world. In this role, you’ll interact with various internal groups and external parties.