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Takeaways from the Jane Street bond prospectus

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Re: Takeaways from the Jane Street bond prospectus

#271

Post by drgiggles »

trelane wrote: post #237
drgiggles wrote: post #204

Earlier quoted context omitted.

When we hire a junior person we are interested in math background, ability to communicate real world value of various models to our investment process and familiarity with computer science and software engineering concepts more than we care about experience with specific languages or technologies. That being said, C++ does still dominate this space so having exposure to it certainly would not hurt.

Who is "we" here? What is your approach for more seasoned folks?

I am a strategist at a smallish boutique quant investment firm. This is how we think about hiring a junior person. It's not all that different for a more senior person, but actual development experience would likely be more important, we would expect more contribution sooner from a more experienced person. More senior jobs also might have more specific responsibilities and therefore require more specific knowledge of technologies, etc. Many junior analyst roles support the team as a whole and there is less concern around experience with specific technologies, typically.

Re: Takeaways from the Jane Street bond prospectus

#272

Post by ProjectArcturis »

llm_trw wrote: post #23
Smaug123 wrote: post #13

> At the end of 2023, Jane Street employed 2631 people > About 80 per cent of the company's capital comes from employee equity, which has swelled to $21.3bn at the end of 2023 o.O

That works out to 8 million per person on average. I'd be interested to see if the Pareto distribution holds here as well, namely that 1% of employees (26) hold half the wealth ($10b).

Hedge fund comp is extremely skewed. When I worked at one, in good years my boss made more than 10x what I made, and I made about 10x what my reports made.

Re: Takeaways from the Jane Street bond prospectus

#273

Post by SkipperCat »

subsubzero wrote: post #221
mayguo wrote: post #63

Earlier quoted context omitted.

> SWE will probably make between 250-500k. New grad SWE is 400K https://www.levels.fyi/companies/jane-street/salaries/softwa... And levels.fyi not very accurate because 2nd year bonus is much larger than 1st year bonus in offer letter. Quants/traders can hit $1M with 5 YOE not too difficult. Portfolio managers (similar to EM in tech) definitely $1M, sometimes $10M.

That is quite good and comparable to IB(investment banker) salaries. Meaning a few years ago $200k by 22, and incrementing $100k a year with $1M by age 30, and $10M by age 40 or so. The starting salaries out of college are now about $350k. My question is I wonder if the upward salary trajectory is similar to that IB track, this is assuming the employee has a somewhat upward career trajectory; does Jane street cap out…

From my experience, the best way to get a pay increase is to code software for things closer to the trading system. Write code that makes a trading app faster and increases PnL, you'll make more money via bonuses. If you're writing back office code doing data loading, trade reconciliation or other "housekeeping" stuff, you'll not see the same comp.

Because of this, getting a SWE role that is assigned to a trading team is highly desired.

Re: Takeaways from the Jane Street bond prospectus

#274

Post by cjbgkagh »

twic wrote: post #264
tikhonj wrote: post #235

Earlier quoted context omitted.

1. You can do it better, with better taste. Existing tools are... not uniformly well-designed. 2. Building something for yourself is qualitatively different than building something for somebody else. (I've heard this described as "situated software"[1].) Both the results and the process are different. 3. Building something yourself lets you become an expert in the domain and the tool you're building, often faster and…

Where i work, there is a lot of NIH wheel-reinvention. People make exactly these arguments for it. I think it's mostly nonsense.

By the numbers I think only the best programmers, which is a small minority, should consider NIH. Everyone else should use off the shelf as much as possible.

Since the best software is written by the best programmers, those of us interested in the best software, and have the capability to make such software, should be free to do NIH on an as needed basis.

Re: Takeaways from the Jane Street bond prospectus

#275

Post by alxhill »

paxys wrote: post #112
ethbr1 wrote: post #100

Earlier quoted context omitted.

> and the thousands under them are getting salaries. The difference is that these thousands also get to invest in Jane Street, which seems a pretty profitable investment (70% margins, etc).

Typically at such companies you have to be at the very top of the hierarchy to be able to buy in and get a slice of the profits. It is very unlikely that rank and file employees are able to participate, at least at a scale larger than, say, a Google employee buying some extra shares.

For what it's worth, a friend of mine is a lawyer in a well-known hedge fund and he gets access to their funds too (funds that would not otherwise be accessible without making a substantially larger investment I believe).

Re: Takeaways from the Jane Street bond prospectus

#276

Post by zie »

alchemist1e9 wrote: post #258
zie wrote: post #212

Earlier quoted context omitted.

They provide market liquidity. The chances that a seller and buyer come together at the exact same time across the 7.5 hours of open market operations is fairly low, so they buy from sellers and sell to buyers and hold in between to keep the markets liquid. This liquidity costs(often advertised as the bid/ask spread). We could essentially close them down if we moved all trading to say 1 hour a day. Though most retail…

[flagged]

First, I never said it was a great idea, or that we should. It's not about envy or not. Liquidity provides a great service, if we need long market hours. If we don't need long market hours, it arguably provides little to no value.

Yes it would massively reduce liquidity, that's the point :) Yes volatility would go up during that hour(especially at the beginning), because everyone would have to figure out the new pricing, but it would remove the need for liquidity as well. It would bring all the sellers and buyers together at the same time, eliminating the need for market makers to provide liquidity.

I'm not suggesting we actually do this, in fact, the markets are trending the other way to 24/7 market trading. I'm sure Jane Street and the other liquidity providers are 100% on board with this plan of 24/7 trading.

Personally, I'm very happy with the status quo, 7.5hr trading days M-F. Though personally I'd prefer they shift a little later so it's easier for west coasters to trade at market open. I.e. shift from EST to CST. I know that won't happen, but that would be my only real complaint.

> Jane Street’s 2613 employees are replacing at least 10x that many needed to perform the same critical and necessary service to the markets from 30+ years ago.

Agreed, they are doing a bang up job providing liquidity to the markets. I'm happy for them. I use their service, it's great.

If we as a society want long liquid trading markets, then we need people like Jane Street to provide that liquidity. If we don't want long liquid trading markets, we can eliminate them and force buyers and sellers to meet all at a given point in time. One is not necessarily better than the other, it's a trade-off.

Re: Takeaways from the Jane Street bond prospectus

#277

Post by lysecret »

drgiggles wrote: post #148

I work in quantitative finance and have wanted to to start using OCaml at work for years. I just find that unless you are at a shop like Jane Street with a well developed proprietary code base, internally developed tooling, etc, there just isn't the ecosystem available for me to be nearly as productive as I can be in other well accepted languages in the quant dev space...which is a bummer. It's been a little while si…

Also in quant finance. Have you given F# a shot? We use it and are very happy.

Re: Takeaways from the Jane Street bond prospectus

#278

Post by pi-rat »

hoosieree wrote: post #162
flipbrad wrote: post #35

Earlier quoted context omitted.

Billion has wildly different meanings. https://en.m.wikipedia.org/wiki/Billion

Prefer "zillion" or "kajillion" to avoid these sorts of pitfalls.

I worked for a FX market maker, and we just used "yards".

Removes any confusion for european and american collaboration.

Got old roots dating back to cockney trading slang: "The Old Lady just bought half a yard of cable"

Re: Takeaways from the Jane Street bond prospectus

#279

Post by walthamstow »

jagger27 wrote: post #224
walthamstow wrote: post #187

Earlier quoted context omitted.

Hectolitre is 100 litres, not 100ml, but hectogram is 100g, not 100kg? Very confusing!

Well yeah, litres and grams are the base units. Just because 1ml is 1g of water doesn't change how SI prefixes work.

I would have thought if gram is the base unit for weight then millilitre is the base for volume, but I must be wrong

Re: Takeaways from the Jane Street bond prospectus

#280

Post by tasuki »

CooCooCaCha wrote: post #250
tasuki wrote: post #199

Earlier quoted context omitted.

You won't enjoy my comment then :) Yes, jobs are voluntary. The vast majority of people could choose not to have a job and not to entertain certain luxuries in life like having a roof over one's head or food on the table. Some even (voluntarily!) choose not to have a roof over their head because they don't like the idea of having a job.

You’re right, I don’t like your comment. It always amazes me how heartless you libertarian types can be. Food and a roof are basics, not a luxury. The fact that a significant number of people in this world don’t have those things speaks more to our failure to provide. Do better.

I'm actually not a libertarian. I guess I'm your standard European socialist: I'm all good taxing (us) rich and providing for the poor.

It still is a choice whether one chooses to work, as evidenced by those who chose not to.

Edit: the "luxuries" was slightly tongue in cheek and perhaps didn't land well. Anyway, you're free to move to the wilderness, hunt/grow your own food, build your own shelter, and do without the socio-economic system altogether.

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