March 7, 2023 | Stamford, CT — More than half of sell-side firms in the U.S. are expected to add headcount in equities electronic desk coverage, a hiring binge that would add to the already growing clout of electronic sales traders and other members of the electronic trading community. 

U.S. electronic equity sales traders, algorithmic salespersons and other specialists in electronic trading are walking the floors of sell-side equity trading desks with increasing swagger. Today, with electronic trading making up a bigger share of the business, electronic sales traders (ESTs) “strut around like peacocks alongside the program traders,” in the words of one industry recruiter.

There will be more strutting in the near future if sell-side firms follow through on expected headcount increases in electronic trading. Fifty-four percent of the electronic sales traders taking part in a new study by Coalition Greenwich expect their firms to expand electronic desk coverage in the next 18 months. Nearly 30% say their firms expect to add headcount in execution/analytics consulting, and approximately 25% report plans to hire in algorithmic sales. 

Approximately 40% of the electronic trading specialists participating in the study expected compensation increases in 2022, with most of those anticipating a boost of 10% or less. At the other end of the spectrum, more than a quarter of respondents expected compensation to fall by more than 10%, and about a third overall anticipated a reduction of some size. 

“Although headcounts are rising, challenging market conditions mean compensation for electronic sales traders will remain a mixed bag,” says Jesse Forster, Senior Analyst at Coalition Greenwich Market Structure & Technology and author of U.S. Equity Electronic Trading: The Broker View.

Enhancing Electronic Trading
As electronic trading takes on a growing role for the sell side, electronic sales traders understand the need to continue evolving and improving performance to justify the investments their firms are making in electronic capabilities. 

“For example, the electronic equities community is well aware of the need to search for order flow from outside the U.S. and Canada, and expand their platforms to support additional asset classes and markets,” says Jesse Forster. “They understand external outsourced trading desks and internal soft dollar programs can no longer be viewed as order flow cannibalization risk, but as the additional payment channels the buy side has already incorporated into their workflow.”

U.S. Equity Electronic Trading: The Broker View examines the individual views of the U.S. sell-side electronic equity trading community on a variety of topics related to businesses and workflow to gain a deeper understanding of the front-line electronic trading sentiment as it pertains to compensation, commissions, desk structure, asset classes, and market structure.