How to Position Yourself in a Slowing Labour Market: A Guide for Quant Traders and Engineers
Strategies for Adaptation and Growth: Enhancing Value and Visibility in a Competitive Landscape
AS the second half of 2023 unfolds, the echoes of Quantitative Tightening (QT) ring loud in the financial industry. In the wake of the fiscal sunset, where the free money from Quantitative Easing (QE) has dried up, we find ourselves in a tough new dawn. Central banks across the globe are in a relentless tug-of-war with inflation, interest rates are climbing, and layoffs—though sporadic—are looming larger each day. For Quant Researchers, Quant Traders, Portfolio Managers, and Engineers, the days of effortless job-switching and sizing up significantly in capital allocation seem to be fading in the rearview mirror.
BUT this isn't the time to panic. No, it's an opportunity to take a step back, reassess, and strategically position yourself for long-term success in an increasingly competitive landscape. The labour market may be slowing, but your career doesn't have to.
GET clear on what you are really good at and make sure you know where you can add value inside out. The demand for talent might have shrunk, but the need for quality remains paramount.
QUANTITATIVE roles require a high level of skill and specialization—your expertise in this field is your greatest asset. Here are some valuable steps to take:
Use this period to deepen your knowledge, not just about the areas that come naturally to you but into new frontiers - the stuff that is around the corner, get ahead of it.
Given that the next 10 years will look different from the last, how are you preparing yourself to stay relevant? It’s no secret that AI automation is permeating many areas of finance. Reflect on where AI can help you - perhaps this could be tinkering with LLMs, training them with your data and enable you to know if there are flaws or biases in your investment hypothesis. Why not use speech-to-text models to compile a database of transcripts for crucial events to help augment your research?
Become highly evaluative of what difference you make in your current team, if you feel as though your impact is waning, take steps to increasing your visibility, volunteer to take the lead of projects that are of critical importance and deliver.
Take a moment to ask yourself, Am I playing to my strengths? If you find yourself constantly fire fighting tech issues, and your strength is coming up with novel ideas to implement into a portfolio - make it a priority to reallocate time and focus on areas with a high ROIs. The best first step to take is to seek feedback. Ask yourself: Have our goals changed? Do my daily contributions align with our priorities? Is what I'm doing perceived as impactful?
Quantify with defined metrics what your input is on your team and track this in a spreadsheet, work towards incrementally aggregating this value with a plan you can stick to.
Collaboration is a wonderful thing, but it can be a cloak in masking the ability to designate where your work has improved or harmed performance. Each time you find yourself starting to work on a business problem, measure and record the difference between the effectiveness of the model, tool or code before and after you finish the solution. Through this exercise you will have data at hand that can undoubtedly prove not only what you did, how you did it and how successful it was.
Go beyond your comfort zone. Explore new and novel research topics, sharpen your programming techniques through starting a github project, and understand the dynamics of the markets better. Collaborating with a reputable recruiter can help facilitate this process (more on this soon).
Perhaps you have worked in traditional finance for your entire professional career, and maybe you only believe in tried and tested mature markets like equities and fixed income. You may not be convinced crypto currencies such as Bitcoin and Ethereum are going to change the world, I get it. It’s not for everyone. However, given the digitisation of everything, learn about blockchain technology, cryptography and encryption, what a smart contract is, educate yourself about tokenization of assets. This curiosity will likely snowball into other research areas and allow you to be on the frontfoot in this new technological shift taking place. Without a doubt these topics will be a feature of everyday life in the next 10 years, so start now. Get a head start.
Upskilling is key to staying competitive and can open doors to new opportunities - be sure that you understand what is making money and what is not. Spend time getting to know strategies that perform better in interest rates sensitive environments.
If you find that the strategy and/or market that you have been working in is crowded, overly commoditised and only performs well in favourable market conditions, now is the time to strategise a pivot into new territories. Sometimes that might mean leaving your current employer due to limitations with resources, data, infrastructure spend, risk appetite, and geographical constraints - especially when the ideas you want to express require these freedoms.
CULTIVATE a holistic approach. As employers become more selective, a broader knowledge base combined with excellence in a narrow area of specialisation becomes invaluable. Quant Traders and Portfolio Managers need to understand the fundamental macroeconomic factors that drive market trends whilst also being well aware of the limitations of their models. This is so important to tactically capture high quality, robust returns. Engineers should familiarize themselves with the realised business impacts of their technical work. This will not only make you more appealing to employers but also position you as a critical team player who can contribute to diverse aspects of a project.
BUILDING a strong professional network should also be a top priority. Engage more with your industry community—attend meetups, industry events, and actively network on platforms such as LinkedIn. Opportunities often arise through personal connections. Sharing research, articles that impact your market and professional certifications will make sure you are both visible and valuable in your professional circle.
PLANNING and preparation is crucial, especially when interviews are on the horizon. Define your job preferences and understand what aspects are non-negotiable and where you're willing to compromise. This clarity can guide you towards your career goals.
SLOWER labor markets, demand that potential hires stand out from the crowd. Research prospective employers thoroughly and tailor your application to their needs. Demonstrate that you are undoubtedly the candidate to hire for their team, but also that you understand their business and can provide unique solutions to their long term problems.
ADOPT a patient yet proactive mindset. While the market is certainly tougher now, it's essential to remember that it is cyclical. Economies ebb and flow, and this period of contraction will inevitably be followed by a period of expansion. It may take longer to land the perfect role or secure that addition capital allocation, but don't let this deter you. Use this time to lay a strong foundation that will serve you well when the market recovers.
As a final thought, while the slowdown may seem discouraging, it is the best time to evaluate your current trajectory and doubling down on self-development. By upskilling, adopting a more holistic approach, leveraging your professional network, preparing thoroughly for interviews, and maintaining a patient but proactive outlook, you can turn this challenging period into an opportunity for personal and professional growth.
REMEMBER, the most robust trees don't grow in the best soil, but in the strongest winds. It is through weathering storms that we build resilience, and it is through resilience that we come out stronger. You can, and will, navigate this storm. The horizon is far brighter than the immediate clouds suggest.
When the market changes course, the decision making process around how to competitively position yourself whilst ensuring to make use of leverage, makes strategic insights all the more invaluable. At Onyx Alpha Partners, we are your partners in discerning these complexities. With deep industry knowledge and a commitment to your success, we're here to help you outperform the competition.
Reach out to us today to discuss how we can help you achieve success in landing your dream position.