OPINION: "A long non-compete will destroy your career as a junior. RESIST!"
I have nearly two decades' experience working as a quant in financial services, both at banks and on the buy-side. I know from observation how damaging non-compete requirements can be to careers.
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Citadel has reportedly increased some of its non-competes to 21 months, but this is only part of the story. 24 month non-competes exist at Citadel Securities, and I have seen many other firms in the high frequency trading sector introducing them even at very junior levels. Some will hire graduates with no experience and try and slap these non-competes on them. Sometimes they're softened with a clause stating that the non-compete only applies if graduates stay for more than a year, but this is just a detail.
The problem is that if you're at the start of your career, and you sign an agreement saying that you will sit out of the market for two years if you swap employers, you're creating yourself a big problem. Two years is such a long period in your work life that, if you come back to the industry, you are basically a different person. And if you've only had one year of experience before you left, what do you have to offer?
My advice to graduates is do not accept this. The non-compete is a clause that you should negotiate if you believe in yourself. It will be very tough to negotiate down, but it can be possible. If you really shine during the interview process and you have competing offers, it can be possible to get these clauses shortened to 18 months at least.
It's important to try this. If you don't, you'll find yourself stuck with one firm. This can be a problem - if you're at a hedge fund, for example, it can be more difficult to become a portfolio manager by rising up through the ranks than by swapping to another firm. A lot of people want to learn the ropes at a successful shop and then to take those skills elsewhere. A two year non-compete will make this very difficult indeed.
Yves Cazenave is a pseudonym
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