J.P. Morgan runs a HireVue video interview for its 2027 Commercial and Investment Bank Markets Summer Analyst Program in Hong Kong, the Research role, and it screens out a large share of applicants before a trader ever watches. The people who get through have usually rehearsed the real questions. This is a single question interview, Question 1 of 1, with close to three minutes of prep and two minutes to answer. This one hands you the definition of markout and then asks you to read a specific pattern. Restating the definition earns nothing. The desk wants to know if you can diagnose what the flow is telling you and what to do about it.
Here is the question, word for word:
Scenario: Markout is a quick, post-trade read on price movement right after you transact. It is intended to reflect direction. For a buy, a positive markout means the price moved up after you bought. For a sell, a positive markout means the price moved down after you sold. One can think of it as a short-term metric - did the market move with you (positive) or against you (negative) in the next 1–5–30 minutes? By contrast, Profit and Loss (P&L) aggregates all effects over longer horizons: price moves, hedging, carry/financing, fees, inventory gains/losses, and client spreads.
Question: If trades with a particular client consistently shows negative 1-minute markout but positive 30-minute markout, what could that imply, and what can you do as a market maker?
The pattern is the whole point. Negative one minute markout means that right after you fill this client, the price keeps moving against your new position for a minute. Positive thirty minute markout means that by half an hour later the move has reversed and you are onside. Short term you look picked off, longer term you are fine. The trade is not toxic, it just moves against you first and comes back. Reading that correctly is what the question rewards.
How you lose points
- You just define markout again. The prompt already gave you the definition. Repeating it is not a diagnosis.
- You call the client toxic and stop. Toxic flow keeps hurting you at every horizon. Here the loss reverses by thirty minutes, so a flat toxic label is wrong.
- You miss the reversion. The signal is that the early move is temporary impact or noise that mean reverts. If you do not name the reversion, you have not read the pattern.
- You panic hedge at the worst moment. Hedging aggressively in the first minute locks in the adverse move right before it reverses. That is the exact mistake the data is warning you against.
- You give no action. The question asks what you can do as a market maker. A diagnosis with no response is half an answer.
- You forget to check it is real. Before you retune anything, confirm the pattern is consistent and not one client, one name, or one time of day, so you do not overfit to noise.
How you pass
A strong answer reads the two horizons first. In the first minute after the fill the price moves against your position, so on a short read you look adversely selected. By thirty minutes the price has come back and the markout is positive, which says the early move was temporary: your own hedging or the client's order pushed the price briefly, or the flow front runs short lived noise that fades. The key insight is that this client is not informed in a way that lasts. You were not really picked off, you just measured the pain at the moment it was worst.
Then give the actions a market maker actually has. You can slow down or stage your hedging instead of dumping risk into the first minute, because hedging into the temporary move is what turns a reverting trade into a realized loss. You can hold or internalize more of the inventory to capture the reversion rather than crossing the spread immediately. You can adjust your skew and quotes for this flow so you are paid for the short term drift you take on, and you can widen only if the pattern ever stops reverting. And you keep measuring: track the markout curve by client and horizon so you know whether the reversion holds before you commit capital to it. Close on the discipline that separates a real trader from a nervous one: short term markout tells you when it hurts, the longer horizon tells you whether it was real, and you manage your hedging around the reversion instead of reacting to the first tick.
Get the ones for your role
This is the only question in the interview, and it rewards people who can diagnose a flow pattern and name a real response, not people who can recite what markout means. The full J.P. Morgan Markets question pack is on OpenInterview if you want to see the real prompts across the Sales and Trading roles before you record.
