Q&A: Fixed Income Strategy & Research @ large NY based (global) firm
Equity Research (TMT) -> Fixed Income Strategy & Research.
AMA about: Career/ networking tips, opportunities in the space, AM trends, etc.
@AndyLouis @WallStreetOasis
How did you navigate the switch between asset classes? In that same vein, what does your role specifically entail?
The switch was not too difficult as I worked with a team tasked with structuring both equity and fixed income products in between the switch. The products we structured were marketed towards a cleitn segment and geography that had a historic bias towards fixed income so I had some exposure to the asset class in the context of investing and managing bond portfolios through a wrapper. This intermediate role involved both research and project managemesnt with an undeniable sprinkling of operational work (which was honestly helpful in understanding how things REALLY worked when investing in both FI and Equity funds). FI Strategy & Research (FI SR) liked my profile as I had a reputation for thinking creatively and being able to use many different tools to develop actionable research. At this point I had a good knowledge and portfolio of projects leveraging the BBG API, and the firm's proprietary API. Both of which were things the new team was looking for in a new joiner. As to the role - it involves developing views on the asset class and investment ideas (mostly macro). These are then shared with clients, showing how they can be implemented using our products. The team eats if the firm's products ultimately sell. Simple. Summary: We generate research and meet with clients in an attempt to convince them to invest in our Fixed Income products.
Why did you switch from TMT to FI?
You could look at this from multiple angles and there are surely flaws in my logic but...
My reasoning was mainly around the fact that I thought FI as an asset class had a much longer way to go than Equities in terms of automation and fee compression. The structural inefficiencies (inefficiencies in the eyes of the end client - economic opportunities for intermediaries like ourselves. intermediares = exposure providers) plaguing FI could lead to more fruitful career opportunities (in my eyes) if I eventually wanted to transition to more of a direct risk taking role. I also wanted to learn more about a broad market over a specific sector. Wanted the optionality that came with not being too pigeonholed into a single sector, I guess. Maybe was a good thing from conversations I've had recently with folks in TMT that have been having some difficulties in moving around following the sector's recent compression.
What’s the typically day to day work within investment strategy? Also what’s the typical career progression within investment strategy? Can you see yourself staying within the role for the long term?
Asking this cause I’m interested in investment strategy but can’t find much resources on it.
Investment strategy, at least at an asset manager, generally involves generating and presenting on views, either on an asset class or agreggate of asset classes. Relationship managers are then mobilized to market products on the back of strategy's views. You might interact directly with large or strategically important clients that request market commentary from view and are interested in what you have to say about whatever you cover. RM's will also involve you in conversations that get deep into a product and its asset class. I've seen folks in the space progress in their careers by generating their research and voicing their views to larger audiences, say for example becoming PIMCO's Chief FI strategist (I assume this role exists but idk - just an example) for North America after Latin American clients for PIMCO as a FI Strategist. You would then be covering a larger client base which would make you more relevant. This would likely come with greater economic compensation. I think a good strategist is generally savvy in the part of the market they cover (need to be. The more "right" calls made, the stronger the strategist's personal brand) and is an exceptional presenter. The role is generally very client facing. Personally I'm enjoying it. The role itself is interesting and where I work/ my team is comprised of a solid small group of folks. The asset class has experienced major tailwinds contributing to its increased relevance over the past year/ 2 years which has also been very nice. Long term I'm curious about Portfolio Management. Not a crazy jump to transition from FI Strategy & Research to managing macro FI portfolios.
Any notable differences in comp between the two tracks?
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