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Career Resources
Can anyone explain what you do in Ficc finance and how it is different from structuring. Thanks!
Taken from a recent career centre posting at my university:
FICC, Equity & Investment Banking Strategies
Goldman Sachs
Is FICC Finance like DCM?
Not necessarily. It can be a division part of DCM in some banks but DCM might have a lot of Leveraged Finance/Debt Origination.
FICC will lean more to the S/T and structuring side of DCM.
FICC at Goldman simply means "fixed income, currency, and commodities." basically all S&T stuff except equities. market-making, prop trading, institutional sales.......
edit: depends on the firm. one firm can be organized differently from the next.
So at Goldman, the Finance Division under FICC would handle developing structured products?
This simply sounds like quant. This is where your PhD in astrophysics comes in handy - you roll in about 400K a year.
I think FICC finance encompasses a few groups, one of which is securitization finance - this is "securitization banking," the group that generates and executes residential and commercial mortgage backed security deals, and other securitized deals like student loans, autos, and any other esoteric loans you can think it. It's no more quantitative than IB and less quantitative than S&T (more banking like work).
The hours are slightly less than banking (but MUCH worse than S&T), and pay is akin to banking (at least at the analyst level). Only problem is see with this area is that it's not that interesting and doesn't have broad exit opps. I personally wouldn't want to be evaluating mortgages and loans all day. Banking deals are much more interesting, at least at the theoretical level.
I think FICC finance probably includes another group or two in addition to securitization banking, but whatever groups these are are not "quant" groups - they are basically banking work within fixed income (for example, there's probably a CDO origination group).
Thanks for the info rat. I was under the understanding that stuff like CDOs and securitization pricing and modelling were much more complex than banking. Do people in FICC Finance go to b-school or can they be promoted directly to associate?
Just so you can qualify my answers here, I do not work in securitization banking (although I did some research on the topic and interviewed with Lehman's securitization group).
I hear it is much easier to be promoted to 3rd year analyst and associate in securitization than in regular banking. Basically securitization is a more niche skill set, so once you learn it, the group actually really wants to keep you.
I hear the modeling involved in securitization is a bit more "technical" than banking. I interpret that as perhaps somewhat more quantitative and complex, and also as more niche (thus less broad exit opps). The people I know who have entered securitization banking or received offers for securitization at my school had skillsets similar to those who received offers in banking. Whereas trading attracts a lot of math and engineering majors, banking & securitization banking seem to hire more econ/finance majors. You're right that the modeling is perhaps more complex (possibly because securitization of some assets, like airplane leases, is a completely new field and thus models must be build from scratch), but it certainly doesn't require any higher math or extremely strong quant skills. If you are looking for a highly quantitative job, you'll want to be in some sort of derivatives trading (in my opinion).
Also, securitization is a really hot area right now. I see the downsides as: less broad exits opps (although maybe you could go to a securitized products hedge fund, but I'm really not sure about this) and less high profile work (securitization deals don't generate the buzz that banking deals do even though they're often huge deals). IF the work interests you though, it may be a great place for you to be. Goldman is obviously a great name, but I don't think they have a huge presence in securitization...I think the banks that have the largest presence in securitization are Lehman and maybe Bear (I'm not sure if larger presence = better experience here though).
FICC Finance - Middle office role? (Originally Posted: 02/10/2007)
Anyone know about GS FICC Finance? It's different from the regular finance division, looks like more of a middle office role.
FICC Finance works in an advisory and marketing capacity with issuers of securities, linking clients with the financial markets. Major clients include sovereign and supranational entities, large financial companies and international and domestic corporations. Finance professionals develop strategies for debt and equity hybrid issuances, derivatives, liability management and new product development. They require analytical ability, marketing and relationship-management skills, and the ability to synthesize both the "financial markets" and "corporate finance" perspectives.
Any other information, analyst daily activities, lifestyle, salary?
any input?
one more bump, and also same question on this:
The Synthetic Products Group (SPG) deals primarily in the structuring and trading of synthetic equity products such as equity swaps and contracts-for-differences on a variety of underliers such as domestic and international indices, equities and convertible bonds. Through the use of SPG products, clients are able to implement a number of strategies, ranging from increased leverage, tax-efficiency and yield enhancement. It is a joint venture between Equity derivatives and Global Securities Services, with a trading, marketing and structuring presence in both Europe and the United States.
No idea, but it sounds like front-office work. "Structuring" (i.e. the structuring of CDOs, CMBS, etc.) is front-office work, this sounds somewhat similar although perhaps with a different product.
FICC is front-office all the way. It's an integrated division with Research, Sales, Trading, and Structuring of fixed-income, currency, and commodity securities. One of the reasons that they're grouped together is that these securities are often highly dependent on macroeconomic developments. I'm sure someone on this board can offer some more insights, but that's the gist of it.
I understand the concept of FICC but I'm evaluating a specific offer within their Finance group, which, from the description, seems to structure and market new products to clients within the FICC arena.
I'm really most interested in analyst lifestyle and bonus, career path, etc. I had been pursuing IBD, would it be safe to assume hours would be a little bit lighter, similar comp but weaker exit ops and more career guys?
FICC: Finance - Work entails? (Originally Posted: 03/13/2010)
Discuss what work in FICC finance entails.
Buy your mom at a low price, and then trade her for someone with an abundant upstairs and a rounder downstairs.
well i wouldn't be a trader, i would be within the finance department.
Sounds like a back-office support position then
Finance consists of product controllers, inventory controllers, accountants, and so forth. If it's product control, then it's more of a middle office position since you have to interact with the front office regarding their P&L.
FICC (Originally Posted: 12/17/2013)
Dear all,
Can anyone explain why Fixed Income, Commodities and Currencies are generally combined into a single team? Is there specific synergies established among their sales/trader/research?
Thank you.
well here is an example of how they are connected:
Australia weathered the global financial crisis pretty well because of their commodity, particularly Iron, exports to china. The chinese can mine iron as well, but it's only profitable at the $110 level whereas Australia can earn a profit at $60 so iron exports, a major component of Australian GDP, is directly influenced by commodity prices. Chinese growth was very strong but has been on a steady decline as chinese PMI indices have been OK at best, hurting Australian GDP and lowering global demand for iron. Australia will need to learn to rebalance their GDP growth, but in the meantime, to boost GDP, the RBA will probably conduct monetary easing, which typically lower their rates or at least hold them steady. And easing is inflationary so the AUD will most likely depreciate. Since the Fed will taper, which is divergent monetary policy from RBA, we will most likely see the AUDUSD shoot down to .80 levels and rates will hold still because of the housing boom generated by the fiscal stimulus should balance against the liquidity injection.
Well said couchy. I like how you gave that real time macro example.
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