What Should The Next Step Be in a Pension Fund
Hi Monkeys, hope all is well with you. I need your advice on choosing which aspects of AM to focus on.
I'm currently a 1st yr Associate in one of the Canadian pension funds. My daily job focuses on generating risk exposure and PnL reports for PMs/Analysts, covering a few strategies, including FI, rates, credit strategies and tactical asset allocation. I also have some exposure to currency exposures for EQ strategy and counterparty risk calculation resulting from OTC derivative hedges thereof.
PMs consume the exposures and calculated hedge requirements (futures, CDS and forwards etc.). It's just portfolio analytics and you Monkey fellows know all of that. In terms of technologies, it's SQL, Excel VBA, Python and PowerBI/Tableau etc.
I have been in the role for half a year.
I clearly lack big pictures and don't know devils of portfolio management. I have been reading extensively work-related books, Quant Equity/Bond/Credit Portfolio Management, Portfolio Construction and Analytics etc. Personally, I like the FI/rates and credit parts more and think this could lead to macro investment strategies. I have been proactively learning asset allocation too in my leisure time.
Any Monkey fellows can share your thoughts on where this job could lead me to? Anyone who is/was in similar roles before?
Hope you are enjoying your weekend and open to sharing your ideas. Thanks!
Bump
Maybe getting the CFA if you don’t already have it, would probably help with promotions
Thanks Pierogi Equities. I will be taking CFA level 3. Probably next November/December depending on COVID. I'm hoping to get it done before I accumulate 4-yr work experience
Bump again
Not sure what you mean that you generate risk exposure that is consumed by PMs? If I were to compare the work you seem to do to the structure at my pension fund, I would assume you'd be in the performance measurement team. So my advice would be tailored to that.
You don't say what you goal is. If you want to move to front office, this is a path I've seen taken where I work: Performance analyst -> Risk (quant) analyst -> Front office quant analyst in equities or fixed income -> PM. This is definitely doable, as performance analysis doesn't build many skills for portfolio management, but risk analysis does. A front office PM aims to achieve alpha while minimizing risk. If you know how to manage risk, you're one step closer to portfolio management.
Hi SReaper, many thanks for your information. I work in the Investment Risk Analytics team which is charged with calculating the portfolios' risk exposures (duration, dv01, cv01, beta etc.) and required hedges thereof. I also monitor a lot of other exposures, e.g. positioning along the term buckets on the curve (curve trades) and so on and so forth. The PnL thing is one-off from my usual work :)
Across equities and fixed income, we have about 4-5 PMs that moved directly from the risk analytics team, all of them on the quant side. We also hired in the past quant investment analysts that were working in risk analytics at other firms. So I think that's probably the best BO role you can have for a goal to move to FO.
Thanks for the insights.
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