Proprietary Trading

How to Join a Prop Trading Firm

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Getting your first role in a proprietary trading firm is no easy task. This is because proprietary trading is unique. Not only can you make good money quickly if you progress well, traders are also trading on behalf of financial institutions, which means the stakes are much higher.

Because of this, proprietary trading firms need logical, intelligent traders who can trade competently, possess good risk management and above all, have a passion for trading.

Identifying these types of traders is no easy feat either, but for most proprietary trading firms it begins in the hiring process. 

In this blog we’ll give you some tips from a proprietary trading firm’s perspective to help you excel in the hiring process and land your dream prop trader role.

Read More: How to Get a Career as a Proprietary Trader


What Is Proprietary Trading?

In the most basic sense, proprietary trading is when a trader trades with the capital of their employer, as opposed to their own. This can be done in a number of ways but usually refers to when a trader is trading currencies on behalf of a prop trading firm.

Prop firms are companies that specialise in this type of trading. They will have teams of prop traders who use the company’s money to trade on behalf of the firm. This can be done in a number of markets but is most commonly seen in the Forex trading and Crypto markets.

Why Become a Prop Trader?

There are many benefits to becoming a professional prop trader. The first is that you will have a steady income, as prop trading companies will be paying you a set salary and providing your trading capital.

Prop trading jobs offer access to trading capital that might be difficult to obtain on your own. This funded trading account can be used to make larger trades, increase your profits and boost your portfolio success, all while using the proprietary firm’s capital to minimise your personal financial risk.

Prop trading firms also offer new traders the opportunity to learn from some of the best traders in the industry. Proprietary trading firms are always looking to recruit the best talent and will therefore be full of experienced traders who can help you hone your skills and utilise expert trading strategies.

If you are looking for an exciting and lucrative career in trading, plus the opportunity to develop your trading strategy, then a prop firm could be the perfect option for you. Contact a reputable prop trading firm today to find out more about how you can join their team.

What Does a Proprietary Trading Firm Look For In a Trader?

Most prop trading firms typically look for profitable traders who have a few years of experience under their belt, but there are a number of ways to break into the industry. If you have the drive, passion and intelligence necessary to trade, prop trading could be a great career choice for you.

The main qualities that a prop trading firm looks for are:

  • Strong risk management skills
  • Proven track record of success
  • Good understanding of the financial markets
  • Excellent analytical skills
  • Ability to work under pressure

If you have these qualities, then a prop trading firm would be a great place for you to start your trading career.

How Do I Apply to a Prop Trading Firm?

The best way to apply to a prop trading firm is to find a firm that offers funded educational programmes. These programmes ensure that you have the capital necessary to trade with and provide you with the training and support you need to become a successful proprietary trader.

Once you have found a prop trading firm that offers funded programmes, send in your resume and cover letter or course application. Be sure to highlight your experience, risk management skills and passion for trading.

It is also important to do your research before applying to submit your resume and cover letter on their website. You want to make sure that the prop trading firm you are applying to is reputable and has a good track record.

How To Land Your Position At a Prop Trading Firm

Prepare for the Interview:

The proprietary trading interview may consist of mental mathematics and brainteasers while sometimes it is more background based to see what kind of fit you are for the firm, either way you should have some good knowledge on the firm and the role you are applying for.

Understand Current Events:

As traders, current events that can affect global economies (like Brexit) make up a significant portion of our trades. Part of a traders day will be analysing and evaluating any overnight news to theorise and predict what impact (if any) they could have on the global markets for the day ahead.

So, if in an interview environment a candidate isn’t able to comprehensively explain a current global event, nor make a prediction on what effect it may have on the markets, this could hinder their chances.

If you have either technical or fundamental analysis knowledge, show this off once you are asked about the possibility of an event impacting a market. This is a sign of a candidate who is displaying passion and confidence in their abilities. 

Know The Firm

It’s a pretty standard interview question for any applicant in any industry, but you should do your research on the firm you’re applying for.

Some firms trade different instruments, others have different funded accounts, others will vary in their training and experience, and so it’s best to know exactly who you’re applying to and what you could be signing up for.

Expect to be asked questions as to who founded the firm, what type of trading they do, and what products, assets, or instruments they trade. 

Bring along a Trading Journal

A trading journal is just like someone’s daily journal – but for trading! A trading journal will typically record a traders daily trades, as well as review what went well with them and what could be improved. This helps traders track their progress and identify any mistakes made in the entering and exiting of trades.

Being able to bring a trading journal with you to an interview is definitely an impressive part of your pitch.

If you can pick out one or two trades and list the things you learnt, or why it was one of your most educational trades, interviewers will love to see your knowledge, experience and passion.

It also looks great because it looks as though you are constantly wanting to learn and better yourself, which is what trading is all about. Traders must be able to own their mistakes when things go wrong, and the only way to do that is to learn.

If you’re a fresh graduate, or a wannabe trader coming from a position of little to no experience this could heavily tip the odds in your favour. 


Check your Qualifications

Typically proprietary trading firms, and indeed, most trading firms, will look for qualifications in what are known as “core subjects”.

These tend to be:

  • Math
  • Economics
  • Physics
  • Statistics
  • Computer Sciences

However it might surprise you to know that degrees in other subjects will also be considered by trading firms. Engineering or technical degrees from good rated universities will be just as desired as one in economics, but other fields like law, and even languages will be considered.

If you don’t have one of the core subjects, you could do an online course in trading or a field related to it to support your application. Some firms take on individuals with no university background as they may have the resources to bring you up to a competent level. In this scenario, your attitude and notable achievements should be made clear to help the firm understand why they should allocate their resources to developing you into a trader.

What’s most important is that you have a good understanding of trading and can demonstrate a desire for it. A college degree of any sort will be accepted in most firms, and even a subject that isn’t stereotypical could get you in the door. 

Extra Tips From a Leading Prop Firm

If you really want to further your chances, good things to mention in your interview are any trading books, blogs or resources you read religiously.

Trading blogs shows a clear passion for trading and the markets, whereas referencing books shows that you’ve done your homework and are keen to continue furthering your trading education and skills. 

You’ll also find that in some trading firms, competitive sports experience is quite common! Showing you’ve been involved in something competitive displays drive and commitment to hone your skills to be the best, a vital component in trading.

If you’re a keen poker player, mention this too. Trading and poker have many similarities, so it could help your trading abilities down the road.

Finally, as much as proprietary trading firms love to see passion for trading and the markets, we are experienced traders and will be able to tell who’s genuine, and who’s lying. Talk about how eager you are, but back it up with examples like books, blogs, or a journal. Someone who’s all talk may easily be pushed to one side if their passion looks nothing more than surface level.

Final Thoughts

Getting a job in a proprietary trading firm isn’t easy, but it isn’t a reason to be dissuaded. Keep working on your trading and educating yourself, and your desire and abilities will speak for themselves.

At Alphachain, we look for someone who’s able to learn quickly, who’s attentive to the miniscule details and who has a passion for learning and trading. Think that’s you? Then read up on our Global Trader Course, or take our Trading Challenge today to land your dream role with us, trading on a live $20,000 account.

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