Was wondering what one would expect to be paid on the traffic desk at a supermajor oil firm and at a physical trading house such as Vitol, Glencore, Trafi on any product desk.
Also, I know it varies quite a bit but what would a junior trader earn in salary and bonus at either the supermajors or physical houses. If anyone has an idea how bonuses are calculated that would be great.
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In your other posts you say you are a university student looking to break into the industry - FWIW you will not break in to the industry as a junior trader, it will take a number of years work to get close to a trading role.
In Europe (loosely adjusted for cost of living, and all in GBP), expect to earn anywhere from 30-55k basic in your first year after graduation. Bonuses at most places are uncapped, however range from 0-50%, at a stretch maybe 75%, from the small sample size of results from friends. Salary advances at a steady past but will top out, at which point variable pay does the job.
Almost all bonus schemes are completely discretionary when you start out, you're not about to get a % of anything, so they are calculated basis how well your company has done, your desk has done, you have done and most importantly how well liked you are.
Yeah I understand I would have to go through a traffic/analyst role for a few years before thinking about trading. Questions about compensation are out of interest. I read an AMA on this site by a Glencore trader who claimed to earn over 1m so I was just wondering how a bonus would be “calculated.” Im interested in working in Singapore. Is it realistic to expect to be hired there at the beginning of a career?
My conversations with recruiters in Singapore/Asia have pointed to the fact that the move is much more feasible once you have 3+ years of experience. They do take fresh grads of course but primarily from that region.
To trade energy at Glencore you would need to complete the 3 year programme (staring on c.50k GBP, and then you may get a shot at trading if the role opens up. Say you get the trading role you then need to earn your own book - that might take a few years (you'll be paid well during that no doubt, but not $1m without managing your own risk..) once you finally get your own risk to manage, your bonus becomes more closely linked to your PNL.
However don't expect a big bonus if your book makes money but the rest of your team haemorrhages cash. Again in my experience all bonuses are completely discretionary. The only ppl I know with a % of PNL are desk heads, even then that is very hush hush and hard to actually confirm.
It is quite unrealistic. Singapore pushes hard for companies to fill entry level jobs with their own graduates, and as an expat it is very unlikely to score an entry position. Furthermore, much of the appeal of Singapore comes from the expat contract you hear about. It’s a two class system for most jobs, at least corporate ones
Trading Development Program at Supermajor (3 Years Post Graduation)
You might look at Ag Trading. Compensation is a little lower usually but it is comparable. However, you can get into physical trading quicker than O&G or Metals. The caveat is that you'll have to move the middle of nowhere for a couple years. All the ABCD companies and others need people to take merchandiser (trading) roles in the country and they usually fill these spots with college grads that they rotate around.
Kind of related: what are the main differences in comp between O&G, Ag and Metals? Do they differ greatly at different levels (i.e. trading development, jr trader, sr trader etc.)? Thanks
I’m actually very open to ags but do ABC hire non-US grads? (Im a UK based student). I know Dreyfus have some programmes in Europe which I’ve made a note of.
Glencore has one too (London Based)
All the ABCDs will have European operations. Most are going to have large offices somewhere in Switzerland (Geneva is a popular City for the offices). Then there will be smaller regional trading offices around the continent. As for specific programs I do know Dreyfus specifically has a European Trader Development program but I think they require a master's degree for it. I'm sure the rest of the ABCDs have something but I don't know specifics.
If you can't get into the ABCDs right after school you can always look at targeting some of the smaller, regional, players. I'm not as familiar with the European players but I'd look for farmer's cooperatives, commercial grain elevator companies, and even processors like flour mills and livestock feeders. All need merchandisers and traders and it's a great way to learn the industry and cut your teeth trading smaller positions before applying at an ABCD a few years down the road.
For Ags:
ADM & Cargill hire grads in the UK, Cargill also in Netherlands. You work in a smaller satellite office, which is the first step in moving to their centralised trading offices.
LDC hire in Geneva, you need a Masters (standard for Europe) and a second language helps (not sure if a hard requirement.
Glencore hire adhoc in the UK and Netherlands.
Pay is lower at the outset no doubt, but you are usually in a low COL area. Pay can increase substantially (although will always lag oil and metals). Edit: Work life balance, not quality of life.. is anecdotally far better.
Thanks for these. Will look into them. Can you suggest any for metals?
Cargill also hires in Canada, Germany, Switzerland, Russia and Ukraine for grads.
Black sea is big for them in Europe, while I know the rest of them are more if there is availability type of opportunity.
What do you mean by "not quality of life?"
Hello, DeltaDecay! Do you think coffee or just commodity trading requires quant/math skills? And does it always take almost 10 years to become a real trader? Much appreciated!
I believe that Glencore hire trainees in both England and Switzerland (with rotations and the likes), if you google it you can find the JD, their recruitment window is from September to October/November. In the UK their starting was 40k GBP if I recall correctly.
In terms of Ags LDC is the only one with a properly structured graduate scheme, they require a Master but potentially you can get hired through the MSc in Commodity Trading at the University of Geneva: it lasts two years and you work from mon to thu while taking classes over the weekend. Other companies hiring through the MSc were Cargill (freight) and Litasco (Lukoil). Just something to consider
UK role is now closer to 50k GBP than 40k.
The problem with that Commodity Trading MSc in Geneva is that there is again a lot of luck involved with progression/placement. The role you would do alongside the degree appears to be pretty admin heavy at some companies, at others it will set you up nicely for a shot at a commercial role. It's a risk, and within the industry I heard of a lot of bigger names pulling out from backing it, about 18 months ago. They did however recently re-structure the programme so that may affect the above.
Yes I agree with you, the experience really depends on the company hiring you/type of job. Ideally, it would obviously be better to get hired directly. Nonetheless, it still is a way to enter the industry. Energy-wise: Vitol, Gunvor, Mercuria, Litasco and Macquarie were present at the speed-recruiting organized by the university this year.
As GMG said, P&L is pretty tricky, I don't think the big shops are paying anyone on the physical side a fixed percentage of book. There is a lot that goes into who holds onto the best seats, and if there is no one strong enough to replace you, a bad year might not sink you, but a good year where others outperform you could see you make less than you hope for.
Ultimately, you'll always be paid just enough to keep you from leaving.
Two quick questions for people in the industry...
I appreciate question 2 is ultra sensitive to opportunities and performance, but just trying to a get general feel, to compare with other available paths. Please humor me, and assume performance is average - I don't want to hear some ridiculous "i know so-and-so who makes $M at 30".
Thank you for the response.
Regarding the switching question, I suppose this stems from WSO's perception that energy "ranks" higher than ag. Is there a specific reason for this? If true, is the difference vast enough that it would be worth the career speed-bump of trying to jump across?
I have no internal reason for wanting to work in energy - it would contain worse lifestyle/location, and is probably harder to have an edge on the market. I guess i'm just trying to reconcile my opportunities vs what the internet tells me is cool. I'm cautious to apply a grain of skepticism with the latter..
It seems increasingly difficult (unless you do a route like veg oils/biodiesel over to energies or something). If I wanted to switch from Ags to Energy I would expect to go back in at the bottom in 90% of cases.
i know maybe 1-2 guys who have gone from ags to energy... its def not common and agree both for the most part started over again...
Cant comment on the early stages but if you make trader (junior, then mid level) you will be able to earn substantially more than any comparable finance role (that is oil or metals related), Those guys can make +$1MM while having a few years of work experience under their belt. I have not seen anybody in my domain (hedge fund) with that amount of work experience make close to those guys albeit some outliers do. As said they all start out in traffic / logistics first and you are by no chance guaranteed to become a trader anytime soon (I have seen some guys do it in like 2-3 years).
Also they travel a serious amount of time (coming from a guy who is travelling on average every other week) and will frequent production (e.g. LatAm, Africa etc.) and customers (Korea, Japan etc.) so dont expect to settle down and expect to visit some interesting destinations on a regular basis.
To answer one of the questions above, its fairly difficult to move from one commodity to another. Relationships are super important in order to get your volumes while making serious cash and the understanding of a particular market is key. As I mentioned long-term earnings prospects are pretty good (e.g. in the millions) and if you are working at a private firm and move up the ranks they can be really substantial (albeit don't believe that you can replicate the payout some of the Glencore senior guys got through the IPO).
Lastly, if you live in a low tax place (e.g. Switzerland or Singapore) you can have a pretty incredible lifestyle
good reply and the glencore ipo guys got PAIDDDDDDDDDDDDD
I have noticed that GAFT offers memberships for students. Is it worth joining?
I have also noticed that GAFTA offers membership for students. Is this worth joining?
I realize this thread is old, but I will be joining a supermajor TDP (3-year rotational) in London soon and I wanted a clearer image of salary progression. Comp will ofc depend on desk /personal PnL, but some broad ranges would be helpful
Has anyone gone through something similar before and willing to offer to add insight?
My current guess is that it would be:
Y1: 45k + (10-30% bonus) [Confirmed numbers]
Y2: 50k + (10-30%)
Y3: 55k + (10-30%)
-> junior trader (if I get a seat)
Y4: 65k + (50-100%)
Y5: 75k + (100%?)
Is this reasonable....?
(Edited & updated April - All numbers in GBP)
For reference, London BB S&T base would roughly be (updated for 2021):
Y1: 65k + 30-80%
Y2: 70
Y3: 75
Y4 (associate 1): 90k
Y5: 100k
Y6: 110k
I realise this is an old thread but wanted to ask what the current salary looks like during the 3-year rotations
I posted that a few months ago... comp hasn't changed
Man I don't usually say this on WSO...but your #s are way too low. Especially year 4-5.
Might be quoting in pounds?
For sure that would be part of it. But % upside also low for some desks. 50% for top analysts is very possibly in year 3. 100% plus totally doable by year 5.
agree those numbers look super low.. in the US.. i know every major is fighting with the banks for the same talent so comp numbers on the base side are similar.. bonus range overall are lower until you are on a desk and out of the TDP
But Supermajor comp is low compared to trade shops (vitol) and hedgefunds. This year, lots of people left the supermajors due to low comp
re: trade shop ...in an overall sense agree... 1-3 years out of school its splitting hairs
re:hedge fund... if you are decent to good you blow out supermajor, vitol and most places
didn't a lot of supermajors this year pay no bonus because COVID-19 = overall business lost money?
https://www.standard.co.uk/business/no-bonuses-for-directors-or-staff-a…
https://www.forbes.com/sites/palashghosh/2021/02/11/shell-to-freeze-sal…
not really reflective of an average year...
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