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Why you don't need that front office strats job in an investment bank

If you're looking for a 'strats job' in an investment bank, you probably aspire to the sort of front office position that means you'll be supporting investment bankers, salespeople or traders - the people who bring in the revenues. However, experienced strats say that if you focus on the front office alone, you'll be missing some of the jobs with the best opportunity to get promoted.

"Strat" is short for "strategist". Strats in investment banks are sort of hybrid data scientists, technologists and quants/quant developers. At Goldman Sachs, where strats began, they work on everything from risk modelling to automation and engineering and data analysis.  

The highest profile strats jobs are for so-called "desk strats" who support traders, working on pricing, risk reports, analytics and traders' technology requirements. However, life as a desk strat can be challenging: it's not unusual to have disagreements with traders, and if you're directly supporting the trading floor you can easily find yourself working a 14-hour day. 

If you're not a desk strat, you can be a "sales strat" supporting salespeople as they pitch to clients. Sales strats help create thematic trade ideas. They can even be expected to originate their own business. 

But if you're not a desk strat or a sales strat, you can work in one of the many other strats jobs available in banks' HR, compliance or control teams. According to one senior strat who's worked for both U.S. and European banks, these can be the strats roles to go for. "If you're a senior strat working on controls, you will get to interact with senior management (heads of division, country and business) and to direct projects up and down across the organization," he says.

Controls strats in particular are responsible for implementing the data solutions and quantitative initiatives associated with regulations. If things go wrong, senior executives can be severely rebuked - but when things go right, the controls strats managing the projects can gain a lot of visibility internally. "A lot of it is working on things like trading controls and anti-market abuse systems," says the senior strat. "The mandate comes from a very high level so generally when you ask people to do things or for resources people always respond." 

The downside of working in a strats role away from the front office is that you won't be working with the biggest brains in the bank. "The people are often second rate," admits the senior strat. "- They aren't the really smart mathematicians." And when you work in a controls strat role, you can become a target for traders if you spot something 'irregular.'

The plus side is that it's generally easier to get a strats role that's not directly linked to revenue generation, and the breadth of the projects can give you huge visibility internally. "Many of these projects go across the investment bank and can be difficult to orchestrate, with different sets of people and hard deadlines that are being set by regulators," says the strat. "If you pull them off it's very good for your career - but you'll need to be a good communicator and negotiator and able to think qualititatively as well as quantitatively." 

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Photo by Rene Böhmer on Unsplash


AUTHORSarah Butcher Global Editor
  • st
    6 May 2021

    Real issue for front office strats (I've been one for >10 years at different banks) isn't the hours. Its that a. banks are filled with legacy systems and b. the real heavy modelling is mostly a thing of the past (unless you work in algos maybe). A very large percentage of desk starts at major banks are working on migration projects, re-writing old libraries to fit some new shiny platform or strategy...and by the time the new shiny thing is ready it is already out of date so they start another migration project etc.
    Its still a nice and relatively easy job if you understand the business and know how to code though

  • Ja
    6 May 2021

    Strats is glorified IT, but it’s still one of good place to be as you can expect the position will still exist after 10 years. More and more trading jobs are being eliminated as banks are trying to reduce risk after Archegos. Think this way, trader is a dying job while strats is a growing job.

  • an
    6 May 2021

    Notice the how often the word "support" appears when describing role. Support = glorified IT = low pay.

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