Why Goldman Sachs is replacing traders with coders

http://www.independent.co.uk/news/business/why-goldman-sachs-is-replacing-traders-with-coders-10503906.html

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Digital technology is transforming every industry, and finance is no different. As an increasing proportion of trades happen electronically, more and more young traders are required to know coding if they want to get the job.

At the moment, 93 per cent of US trading volumes are executed through electronic channels. Some trading, like index-based CDS trading, is almost entirely performed by machines, while FX, or currency trading is 76 per cent performed by machines, according to a research by Greenwich Associates.

As more trades are conducted electronically, it becomes more and more important for new employees to understand coding languages like Python, according to Sarah Butcher from eFinancial Careers.

The use of Python in investment banking technology platforms has increased over the past couple of years. Developers have been rewarded with higher salaries as they become more important in the workplace. In 2014, Python developers working in banking could expect to get paid between £80,000 and £140,000, up from between £70,000 and £100,000 in 2013, according to Thompson Keene, IT in finance recruiters.

“Python skills are currently hugely required for research based roles, as it’s faster to write code in this than C++, but arguably not as robust or offering as much flexibility, when it comes to actual production code,” Stephen Grant, managing director of technology recruiters Cititec told eFinancial Careers.

One electronic trader who has worked in a senior role at Goldman Sachs told eFinancial Careers that it’s a “generational thing”.

“Every computer science and maths student and every top university wants to be a trader, and they’ve all studied coding. Pretty soon, all the juniors in finance will be coding-literate,” the trader said.

According to Chris White, the creator of Goldman Sachs’ corporate bond trading platform GSessions, shelved last year, traders that remain with the ‘traditional’ knowledge of fixed income products need to supplement it with an understanding of how markets are evolving.

Now the owner of his own fintech consulting firm, Viable Mkt he said: “We’re teaching some of these traditional groups, who’s experience is of huge value to employers, that they cannot ignore how technology is modernising these markets or they risk being casualty of change.”