Why are High-Frequency Trading Firms paying high salaries in India

This post is relevant for students who are in IITs or aspiring for becoming an IITian, students looking for a job or switching from their current job and other professionals who are really curious about HFTs or High-Frequency Trading Firms in India.

It’s 2022 and the placement seasons in the IITs are now over with an unprecedented number of offers of over 1 cr in India. This has been possible because of the huge rise in the salaries that the HFTs pay for hiring top talents from the top IITs.

Now, coming straight to the question! Why are HFTs paying such high salaries in India?

First, let’s take a quick glance at the numbers. HFTs this year have offered salaries as high as 1.6 Cr – 1.7 Cr per annum for working in their Indian offices. In fact, some of these companies are not even international firms, they have started and still operating in India only.

Below are some of these firms which are paying above 1 Cr INR per annum in India.

• Graviton Research LLC – 1.2 Cr per annum
• Quadeye – 1.2 Cr per annum
• NK Securities Research – 1.68 Cr per annum
• AlphaGrep Securities – 1.03 Cr per annum
• Edge Focus Partners – 1.00 Cr per annum

There are a few others. I have a blog post where I have mentioned top HFT firms in India along with their salaries and perks. Please check it out to know more about these firms.

Till last year these firms reached a maximum of 60-70 Lakhs per annum. But in 2021, everything changed.

What changed in 2021?

In the placement season of one of the IITs, two big HFT firms which have been the most competitive and have been performing well in the past couple of years went into a bidding war to hire the top talent from the IITs.

They started their salary around 60-70 lakhs, almost the same as last year but after the bidding war they went up to 1.2-1.3 Cr per annum.

Seeing this, almost all the other HFT firms also raised their salaries to hire top talents, or else they would have been out of the competition itself.

Apart from the above reason, the main backstory behind this and the reason they could afford such high salaries is the fact that during covid times, the markets were very volatile and the HFTs thrive in such markets. HFTs have made fortune in the last couple of years and are looking to expand quickly.

The companies mentioned above made profits in the range 1000 Cr – 2000 Cr. This might not seem much but the total number of employees in such firms is less than 100 so the profit per employee is higher than some of the biggest firms in the world.