IG Credit Careers
Hi I accepted an offer to do IG Credit Research for an AM firm in the South. Was wondering about the career and compensation prospects of IG Credit and if I should try to move to HY or Equities.
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Based on the most helpful WSO content, Investment Grade (IG) Credit Research is a solid career path with good work-life balance. It's often seen as less volatile, more like clipping a coupon. You might not have a massive year, but the likelihood of getting blown out is very low.
In terms of compensation, it can be higher than corporate development and lower than Private Equity / Hedge Funds. It's probably similar to banking, maybe even less, but with way better hours.
As for moving to High Yield (HY) or Equities, it largely depends on your career goals and risk tolerance. HY and Equities might offer more upside, but they also come with more volatility.
Remember, there's no one-size-fits-all answer here. It's about finding the right fit for you.
Sources: What are the different types of Credit?, CRE Credit Analyst Career Path, How to Thrive on Your Research Internship, Credit research to equity research, Career Path Starting as Credit Analyst
Bump interested as well for sure, especially with regards to exit oops in terms of number of shops running IG strategies as it seems concentrated to the largest asset managers and insurers
There are lots of asset managers / insurance that invest in ig bonds obviously the large brand name places - but also a surprisingly long tail of small asset managers / insurance cos that are involved in the space
With mergers of larger asset managers think invesco buying Oppenheimerfunds or morgan Stanley buying Eaton Vance there have been compression of analyst seats
I know some places have it where analysts look at ig / hy for their specific sectors
Given the need for places to invest in high quality fixed income investing in ig isn’t going away but u can probably see large real money seats stay flat to down
Also the multistrats hedge funds have been getting more and more involved in the space - that can be more short term oriented but can be ok place to work
Thanks so much for this reply, do you think passive is a threat in this market to future career prospects and also what comp upside could look like?
passive management / fee compression / low yields in the 2010s have all lead to manager consolidation / cost cuts - you have definitely seen the number of analyst seats at large asset managers shrink
at the large asset managers i believe comp is steady but trailing equity long only comp in many cases- you will never really have a home run year as an ig sector analyst at a long asset manager but you wont ever really get blown up leader (exceptions would be when PCG filed bankruptcy in 2019 / the recent regional bank crisis in march)
big long only PMs can do really well if they are managing large total return mutual funds / sleeve of mutual funds
Thank you for the information, I guess I'll have to figure out where exactly i fit into the industry.
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