Salespeople

Generally I find salespeople just to be annoying. And that's from a buy-side trader's point of view, not a sell-side trader. Of course sell-side traders hate salespeople because the nature of the relationship is to be slightly adversarial (the salespeople are advocates for their coverage and just want to do volume, while the trader wants to take the right risk at the right price and not necessarily just print big trades). As a buy-side trader though, I still hate most salespeople.

First off most salespeople are simply slimeballs. Their job, correctly done, is to act like your friend and get as much information out of you as possible. I don't need any more fake friends. I get plenty of those when I go clubbing and the hot 19 year old model-wannabes want a feel of the high life. Fake friends are a dime a dozen. I certainly don't need to be giving information about my intentions and my positions to help salespeople make their trading desks aware. Fine, that's their job, but I find it highly unnecessary. Granted I don't blame the salespeople for doing exactly what they are hired to do. Personally though, I enjoy talking directly to the traders when I'm trading. What good is a middle-man (or woman) just relaying exactly what I say to the trader?

Fine, perhaps I'm being overly cynical, but being a quant guy I like my screens. Most of the time I'd be content with a screen instead of a salesperson and trader.

So what is really a salesperson's role? Well, in reality they are there for their firm, not for their customers. They will tell you that they're there to be your advocate to the trading desk. That'd be cool, except that would align them against their firm (and thus their incentive structure since their firm pays them). The best salespeople I know learn all about their client, their trading style and their position/view. Then the salespeople can make the trading desk aware of the client's intentions so that the traders can adapt accordingly. Even better salespeople will know the client's trading style and requirements enough to suggest trades the client should do. Most likely, corporate clients need to be told what instruments are available to them to manage their risk. Exotics desks would not exist without salespeople hawking their wares.

So they do provide a service, simply not as much for the sophisticated trader, especially not the sophisticated hedgefund or prop trader. They do, however, generate tons of money for a firm by encouraging trading (bid-offer), especially in illiquid instruments (read: they'll rip your face off by selling you an exotic instrument where they made 25bps of bid-offer--actually usually they end up warehousing some of that risk because it's unhedgeable but they will charge 25bps through fair value to charge for having to warehouse the risk). I'd recommend being a salesperson as a job choice to many people, but don't expect to be everyone's best friend (although most of them act like it).