Why Wall Street Traders Are On The Decline

Buying and selling stocks or bonds used to happen on the phone, in person, or in the packed trading pits in Chicago, New York and London. Prestigious investment banks boasted of trading desks the size of football-fields. Now, they’re losing money on trading operations and laying off scores of traders.

The number of trading, sales and research jobs at the Top 12 banks in the United States have dropped precipitously in the last nine years. In 2010, those big banks employed about 21,000 people who worked in equities — or stocks — and 27,800 people who worked with fixed income, or bonds, according to research firm Coalition.

By the third quarter of 2019, those banks employed about 16,000 people in each category, a drop of about 5,400 jobs in equities and nearly 11,600 in bonds.

The shift to electronic trading and passive investing are big culprits behind the trend. Now more and more big Wall Street names are finding it harder and harder to make money from trading. The rise of passive investing and algorithmic trading are squeezing profits in the trading business to razor thin margins. So what’s happening to Wall Street’s once prestigious trading profession?

CORRECTION (February 20, 2020): At 2:55, David Weisberger’s former role at the New York Stock Exchange was mischaracterized. He worked on trading automation on the NYSE floor.

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Why Wall Street Traders Are On The Decline

[nathancosta]

Electronic trading, passive investing, and technology are the culprits behind the decline. Saved you guys 14 minutes.

[danielkey]

Nobody can become financially successful over night. They put in background work but we tend to see the finished part. Fear is a dangerous component, hindering us from taking bold steps we need in other to reach our goals.

[Mayor]

I HAVE INCURRED SO MUCH LOSSES TO TRADE ON MY OWN, I TRADE WELL ON DEMO BUT I THINK THE REAL MARKET IS MANIPULATED.

[alexyoung]

The best course of action if you lack market knowledge is to ask a consultant or investing coach for guidance or assistance. Speaking with a consultant helped me stay afloat in the market and grow my portfolio to about 65% since January, even though I know it sounds obvious or generic. I believe that is the most effective way to enter the business at the moment.

[Xx-pofu]

Why pay a broker $35 per trade, when you can now do it for free over the internet.

[bobbymainz]

Several of the biggest market experts have been voicing their opinions on exactly how awful they think the next downturn would be, and how far equities may have to go, as recession draws closer and inflation continues well above the Fed's 2% objective. I'm trying to build a portfolio of at least $850k by the time I'm 60, therefore I need suggestions on what investments to make.

[wilfredpeake]

of course this trend starts happening after i graduated with a degree in finance

[AgentSmith]

Having people running around on the floor, yelling, screaming and waving their hands is incredibly inefficient and silly.

[nick]

Now wall street is getting the wall street treatment. No compassion, no empathy, no loyalty just profits. I'm I'm trying so hard to choke back my tears as I'm typing. It will be the hedge funds next.

[digginz]

I once told my lawyer in 2010 that I was interested in finance or law. He told me not to waste my time- the world was awash in analysts and lawyers. Plumbers make more now than stock brokers

[ygui]

*Me watching The wolf on wallstreet and other broker movies :*

Those were the cavemen days

[Pambegay]

I have challenged myself to put away 50% of my monthly income into dividend stocks which is quite easy since I live frugal at 32 without debt. I work as an account executive, and make over $2000. $1000 goes into dividends, and the other $1000 covers my my food plus living expenses. I am seeing improvements in my portfolio, dividends look certain, but I have to attribute this to only to guidance of a licensed fund manager who allocates funds to a plethora of assets. I have to stay disciplined, and remember that I’m in it for the long term. Good luck to everyone and thanks for the great video.

[leocardenas]

I prefer clicking on buttons than picking up a phone and telling someone what I want to buy or sell. Plus trading on computers is faster and more accurate.

[anona]

Look at the good thing that has happened, now even a common man can buy and sell without involving any human brokers

[alansimons]

Am I supposed to be sad that a middle-man is disappearing?

[alexsmith]

Retail investors get to keep more of their own money. Financial services has always been about skimming off the top

[baddog]

I remember when a hot girl used to hand you your money in a bank too. Now your lucky to find a cashpoint machine in your town.

[mrpinkpony]

People made a living ripping other people off. Electronic trading and markets were a great and necessary disruption

[georgeshoemaker]

obviously a job that has to do with trends in numerical data and making fast decisions was going to be replaced by software

[Striker_]

⚠️ without watching this: Computers. 👨‍💻