Qualitative Jobs in Finance
Hey everybody,
So I am deep into my "career research" concerning where I want to work in finance, and I figured I'd come here for the following question: although I do enjoy math, I don't want to spend my life number-crunching and plugging numbers into mindless models. All the careers on Wall Street seem to be quantitative. Which ones aren't? Is there such thing as an entirely quantitative finance job?
HR
Investment writer
compliance
rating agencies
Research editor
UBS Quant
HA +1
biz development
So basically just a bunch of back-office stuff. Got it.
Finance works with numbers so there's really no way around it. Though perhaps look into sales on the sales and trading side which tends to be more about client relationships. In addition, upper level IB is glorified sales though you'll have to pay your dues in the Analyst/Associate/VP/etc years.
Thanks Fedman. Yeah, sales is surely atop my list.
Thanks Fedman. Yeah, sales is surely atop my list.
Qualitative / Macro S&T Desks (Originally Posted: 06/22/2009)
What desks within S&T tend to be more qualitative and macro-focused at the same time? Currencies/FX? Credit?
I believe that I have a good understanding of how the markets move in accordance with different trends and government actions, etc. but high-level quant analysis or programming has never really interested me. I'm more about the cause & effect relationships and the intuitive side of how markets function..
FX on the trading side is a mix of qualitative and quantitative... but not really "high-level quant analysis or programming" unless you are doing structured products or exotics from what I've seen. Spot traders tend to focus a lot on trends and price action as opposed to market fundamentals since often their time horizon is a few minutes to a few days and not often longer. This is not to say they are oblivious to the economics (far from it), its just that intra-day trading tends to be more technical imo... looking for good entry/exit points within the larger picture.
The sales side mixes the two really, where you are pitching ideas to real money or funds or whathaveyou, so they may have a longer time horizon and the fundamentals might mean more to them.
If you do not like options math (if that is what you are considering to be quant, I'm not sure about what your definition is exactly) then avoid those desks. Understanding the risks and your greeks can be rather complicated, and based on your wants, it doesn't seem like a good fit.
Rates also involves a high degree of macro-focus, and in a lot of ways Rates traders and FX traders look at a lot of the same research, data, etc. From what I've seen though, technical analysis is less prevalent in rates (feel free to correct me). Others can speak to this better.
If you are interested in the Macro, avoid Credit. Its mostly focused on examining individual companies, or similar ones (Particularly in high yield). Going through Financial Statements etc. As someone pointed out for me before so helpfully before I started this summer, High Grade Credit is more a combination of micro and macro, since it is very much dependent upon the yield curve, and since it is high grade, going through financials (while important) is not as important as in High Yield.
Thanks for the info. My interests lie heavily on the macro side (also more fundamental), so Rates sounds pretty exciting. How much quantitative analysis is involved? I am not completely adverse to doing math or anything, but I just want to make sure that I could be successful at it without any real quant background.
How are - Commodities spot Govies/agencies Converts ?
First, you need to understand that all products are linked and the best people try to maintain a total perspective whilst focusing on their market.
That said, while trading doesn't generally require higher level math, I think understanding the math that governs the fundamental valuation is helpful. One of the major areas of focus for quants at banks is yield curve forecasting, which you'll eventually want to dig into.
There's a lot of liquidity in rates and you'll have a totally macro focus. The spots are usually very coveted; you'll learn a lot. FX desks are usually pretty close to rates, and they often share desk researchers (especially in these days); that should tell you how related they are.
I don't know much about how the markets for commodities actually operate - I just try to keep track of the general movement. Converts usually trade from equity desks, although I keep a close eye on any converts of companies I cover. But since you're not interested in credit, you shouldn't consider joining one of those desks.
how does trading credit work? if one is doing high yield company analysis when does one have time to trade?
Just like rates, you have desk researchers and strategists to provide informative summaries on the companies you trade; 1st year analysts and interns shadow traders, but spend a lot of their time with the researchers. There's also generally less liquidity in credit than in rates, but that's not to say it isn't fast paced.
franklinf, you also need to realize that trading is not a 9:30 - 4pm job. Most traders are in by 6:30 (most jr people are in before 6), so you get in 3+ hours of analysis before the market opens. Jr people also hang around until at least ~6:30 to take care of admin stuff and do additional research.
The more risky the credit, generally the more analysis is entailed. Thus high yield guys do more research (more non-market hours) than investment grade, and all credit traders generally put in more hours than rates. Everybody needs to know what's going on with the curve, and then credit guys need to know their companies. With IG credits, you can generally work off of a given spread from treasuries given the grade rating (ie - AAAs trade near each other, AAs, BBBs, etc), but there're always nuances. With high yield companies, there are even more idiosyncracies and their investors are usually very deep into the company's fundamentals, so you need to be as well.
thanks yesman, that was very helpful
Commodities is super macro. Some of it is pretty quant, but depends on your desk. Emerging Markets is obviously macro, and whether its quant depends on the product.
Just adding on to that, I know its almost always separate, but don't even think of EM as a product group per se. EM is essentially the local version of every other FI product: FX, Bonds, Rates, etc. It is different from a liquidity perspective (particularly now), but the products are basically pulled together from other desks. I don't know if this is similar at other firms, but at mine basically you trade your time zone... so NY does South America, Singapore does Asia EM, and I think London does Eastern Europe and Middle East.
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