Qualitative Jobs in Finance

BoothorbustUBS Quant

HA +1

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.