Why is Capital Markets not as good as other IBD groups?
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(Senior Monkey, 79
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on 6/5/10 at 2:29pm
In this forum, a lot of people talk about how Capital Markets groups aren't as good as other IBD groups such as Industry groups, M&A, or LevFin. Why is this? Is it because the deals aren't as interesting, differences in exit opps, or just the superficial prestige factor?






It's not as complicated and
It's not as complicated and it doesn't involve valuation. If executing a bond for Walmart sounds exciting to you, then go for capital markets, but it will be difficult to get buyside interviews. That said, if you want to do banking as a career then capital markets is pretty cushy, if not prestigious.
Juwanna Mann wrote: It's not
It's not as complicated and it doesn't involve valuation. If executing a bond for Walmart sounds exciting to you, then go for capital markets, but it will be difficult to get buyside interviews. That said, if you want to do banking as a career then capital markets is pretty cushy, if not prestigious.
Makes sense. I'm wondering about the prestigious part though. In my view of Investment Banking, it's always been that whichever group/desk that makes the most money for the firm always gets the most respect (the reason BO/MO roles are looked down upon) especially in an industry as $$ focused as high finance. I don't know much about DCM but it seems like ECM pretty much makes cash to burn in the good years
LevFin is also typically
LevFin is also typically wrapped up with DCM as well, so I wouldn't write it off. DCM can get very technical in terms of pricing, origination, syndication. It depends what aspect of the deal you want to sit on and how close you want to be to the markets
You just dont get the IB
You just dont get the IB skillset or the Trading skillset. you're in limbo and supporting the other 2 sides...
How do ECM/DCM "support"
How do ECM/DCM "support" bankers? I thought they were bankers, just underwriting bankers as opposed to M&A, and of course "less prestigous"...and isn't valuation work part of pricing a debt or equity offering?
read monkey business, capital
read monkey business, capital markets is not considered bankers, they are just clowns who u hope dont insult the client too much to close the deal.
swagon wrote: and isn't
and isn't valuation work part of pricing a debt or equity offering?
Theoretically, yes. Equity offerings are obviously very closely linked to valuation, but at most banks that valuation work is still done by the coverage group and ECM will focus more on issues like market receptivity, sizing, secondary/primary mix, etc.
Investment grade debt offerings don't have so much to do with valuation, because the debt is nearly always taken for granted as money good (unlike high yield where valuation and subordination becomes much more important). DCM prices offerings off treasuries, for the most part, so it's much more market-oriented.
They are unique skill sets and ECM/DCM bankers do things that industry bankers can't do - it just isn't a skill set that translates as well to the buyside, that's all.
mrbrightside wrote: read
read monkey business, capital markets is not considered bankers, they are just clowns who u hope dont insult the client too much to close the deal.
I love Monkey Business, Liar's Poker, Barbarians at the Gates, and the other classics just as much as everyone but I'm not going to use it to shape my perceptions of the current industry. If you applied the beliefs of the traders from Liar's Poker to the real world, then ABS/MBS desks would be the hottest places right now. There's a reason that it took almost two decades for an LBO to be notionally bigger than the RJR buyout and that adjusted for inflation no other LBO has even come close to matching RJR.
It was a different time then.
How much less do VP's and
How much less do VP's and MD's in capital markets make compared to those in the traditional advisory IBD groups. Seems like its relatively easy to move up the ranks in capital markets.
yeah, i noticed a lot of
yeah, i noticed a lot of "senior" people under 35 in capital markets.
guts wrote: yeah, i noticed a
yeah, i noticed a lot of "senior" people under 35 in capital markets.
I know a guy who got promoted to MD in ECM at Citi and he's only 32. I'm not sure how relevant his specific case is though because he seemed really driven to succeed. Very Type A.
capital markets people are
capital markets people are experts in a particular product, just like M&A. if you ask which group killed it in 2009, everyone will tell you capital markets saved the day. certain capital market groups are a lot more valuation based than bankers pumping the same models everyday (e.g. equity derivatives, convertibles, etc).
The only downside of capital market is that you become specialize in something that might have limited use in the future, which limits your exit opportunities, but you get to have 8-7 work hours and no weekend work.
It's a good career choice,
It's a good career choice, and capital markets bankers aren't fussed about exit opps. A lot get more specialized later in their careers and become highly sought after (especially in London and developing capital markets).
so i guess no one knows much
so i guess no one knows much about capital markets salaries at senior levels?
capital markets has weekend
capital markets has weekend work. hours are more like 7-midnight. weekend you might do 12-6 on both days
you have no exit opps. pay is lower than traditional ib. ib has more bankers. at the senior level i don't really think you are sought after. if you are its for 1 job that all the senior capital markets bankers fight for.. just no exit opps. capital markets is first to go when markets go bad
Ratatouille wrote: capital
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if you ain't first, you last
at places like jpm, baml,
Ratatouille do you work in
I work in the industry. i
Thank you for confirming that
Ratatouille wrote: I work in
Ratatouille wrote: capital
So are Converts the most
bankingplease wrote: So are
Most SVPs and MDs in ECM earn
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gorilla4sandracing
I might also add that while
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I think people in ECM tend to
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this is silly, you guys
For someone looking to stay
One thing to keep in mind is
Just out of curiosity, do
looking for that pick-me-up to power through an all-nighter?
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Holy shit this is a retarded
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