Funding Desks

Hmm, are you talking about the guys sitting in the banks' treasury that manage the repo/collateral books and manage the banks cash? I know that at the Big5 banks in Canada, they don't really have specific recruitment cycles for these types of roles. They just fill the spots internally from the front office (believe it or not, a lot of people are interested because of the low stress and more stability).

manbearpig -- correct me if i'm wrong but you're a consultant at deloitte who has never worked on a trading floor, correct? can i ask why you're providing inaccurate "insight" into the industry?

if you're asking about the repo desk, they recruit with the standard analyst/associate program. anyone who knows anything about markets will tell you most markets are about rates and most of rates is about repo. i myself have never worked repo in any fashion but the guys who really know that market make a killing on the rest of the curve. "ideal path" for a tsy trader is repo -> bills/2yr->5yr->10yr->bond/retire.

hate to contradict manbearpig, but you don't see a lot of established guys move on to repo. most repo traders are either lifers or jr guys who plan to move on after 1-2 years.

Worked on a funding desk. As explained both repo/money markets is apart of the usual rotational programs. Treasury depends, each bank runs their treasury area a bit diff, certain places give them more power than others. So at some of the BB treasury may be a place for rotational others they may hire right into it.

Back in the day, repo guys were kings most of the guys are back from the 80s and are still around, so jr guys usually will find very hard to break in. Pre-2008 repo/treasury was overlooked as when MBS/exotics are printing crazy money no one cares about solvency or what it takes to fund the prop desks. Then in 2008, some of these places saved their banks, same thing has happened last couple years as I would say funding and repo have come into highlight in these environments. Though at 0% rates its a tough market for any funding desk.

Lastly while not always true, I do think most rates or guys who trade 2vs5, or 10s like bearflatten has mentioned now today require alot more math and techncial skills than traditionally repo traders did, so making the aking the jump from repo to the path mentioned may be a bit more difficult today.

Thanks for the responses, that's exactly what I was referring to MBP and marcellus. I'm guessing short-end rates s&t is where most of these guys come from, right?

Recruit from the normal S&T pool at my bank

Goodbread- I can add some color to your question, as I work in the ops side of funding (Top BB).

Both repo desk and treasury funding are not overly difficult to break into, openings just are unheard of. They are often filled before the job is posted online. There is also an opportunity to move into these roles if you impress the right people.

P.m me if you have more questions.

How is a repo trading desk different from securities lending?

I've sat next to a guy on the funding desk (note there was only one for the bank) and my understanding was that he pulled money from lenders and from the bank's treasury. The funding desk isn't really a trading position from my understanding.

it is not, it is also called Liquidity and capital management. Most likely provide funding for the bank, through repo/resales..Fed fund lending...etc. Agree with this one, less intense, mediocre bonus but definitely a sweet job if you are not the alpha type.

As an example the funding desk I worked on had a money markets guy and repo guy. The money markets guy raises money from O/N to about 1-2months out. Repo does the same sort of thing, if the bank is raising too much $$$ the repo guy will go out and buy short-term bonds if too little will sell short-term bonds. Likewise the money markets team will usually have some decision and view on OIS and other things.

I disagree with the view that it is not a trading position because during deal time the money markets team is very busy both regarding LBOs and M&A activity, you need to raise/sell large amounts of money O/N and effectively have some sort of ongoing short-term plan. Likewise the bond/equity teams who are helping on these deals depend on you and how you raise money to lower their costs during turbulent times like that. Similarly you can always take some pain on OIS positions and other instruments or so.

The above sounds great to me. Nothing to do with alpha/beta whatever. I want to trade something macro, I'll worry about the money later.

Marcellus,

How much window dressing is done by these desks at quarter/year end? What exactly would this entail (for example, what sort of positions would these guys take to make the books "dressed" well)