Why, in addition to your pay, what else does your employer expect for you? How much do you make? How many hours a day? For me, this is about being asked questions you might not normally be asked. To find out more about these questions, I talked to former New York Stock Exchange trader Jim Prentice.
As many traders already know, in New York, in which he still works on Wall Street, he makes as much as $250,000 a year and can earn more than $5 million in a single year. Prentice, 46, is now the author of “The Price of Trading” and his former colleagues at the financial trading firm J.P. Morgan Chase were happy to talk with me during the last three weeks of our trip to Washington.
There are a few things about that $250,000 salary he wants you to know. Here’s what I learned:
The number is a figure that traders give to their managers as a basic benchmark that tells them how much money a manager is earning from stocks without regard to the analyst commissions he or she receives from those stocks. Prentice told me that his total earnings in one year were $1.4 million from stocks at JPMorgan Chase.
After adjusting, for example, Prentice’s compensation for one day of trading would be $80 a day.
To put that number into context — $0.5 million — in 2013, Prentice’s average monthly earnings were somewhere around $50,000.
A person making that kind of salary on Wall Street probably makes much less than $250,000. (But as we’ll see, some people make much more.)
“It’s always been a challenge for me to figure out what a trader makes. We’re going to try and come up with something that people can relate to,” Prentice says.
It’s also a challenge.
“For me, $250,000 is not a salary. I don’t like working for somebody that will take me for a ride and then I end up being part of the compensation package,” Prentice tells me, adding that he is trying to work out what he’ll do with a larger salary.
“My goal is make $50,000 to $75,000,” he says, adding that if he could make $50,000 by the end of this year, that would be a great accomplishment.
It’s also a difficult goal because Prentice made the money he made