Interviewing Options Traders

[+15] u/zech83: Have any good resources you could share? So far I've only learned to do the opposite of what I believe to be the most logical. [+14] u/sprezzatard: Because they never actually traded before, because they are junior 🤔 Because if you ever sat through watching a back ratio spread and you don't know what those things mean beyond theory, you're probably not going to hold through 🤷 [+9] u/GammaStructure: A few things I’d want to hear: 1. Can they explain how PnL decomposes? Not just delta/vega/theta in isolation — but how a short strangle behaves when spot drifts, skew shifts, and vol-of-vol expands at the same time. Do they think in exposures or in strategies? 2. Do they understand that most “directional” options trades are actually vol and skew trades? If someone can explain why a risk reversal is often a skew expression (and how that changes in stress), that’s signal. 3. Can they talk about margin and liquidity in a vol spike without hand-waving? Rolling short premium into higher IV might improve credit, but what happens to buying power? What happens if correlation goes to 1 and everything gaps? 4. Do they think in distributions instead of opinions? Moving from low IV to structurally high IV isn’t just “options are expensive.” It changes sizing, tail risk, and how quickly convexity can overwhelm carry. For me, real applied competence shows up when someone frames trades in terms of: • Positioning • Surface dynamics (term structure + skew) • Path dependency • Risk concentration Anyone can recite Greeks. I’m looking for someone who understands what actually moves PnL when the surface shifts and liquidity thins. If they can walk through a trade that went wrong and explain why in structural terms — that’s more convincing than a credential. [+7] u/OptionallyDeranged: Ive hired a few folks with it, they tend to get up to speed much quicker, to the point where we have out our recruiter to look for people with it. [+5] u/AKdemy: Usually an (in-depth) understanding of (options) trading, or even finance, does not matter much for junior positions. Many brilliant people studied something completely unrelated and were simply drawn into the industry by limited alternatives and strong incentives (remuneration). [+5] u/Elegant_Primary_7133: i’d probably look less at theoretical recall and more at how they think about risk under stress. for example: – Can they explain P&L attribution (delta vs vega vs vol-of-vol)? – Do they understand how margin expands in stress and how that forces position management? – Can they walk through what actually hurts first in a short premium book during a vol expansion? in my experience, people who’ve managed real risk (even small size) speak differently about drawdowns, liquidity, and margin than those who’ve only studied pricing models. i’d rather see a detailed trade journal with reasoning and post mortems than polished theory. [+5] u/xpdx: Do they make money? Then none of that matters.