any FI/rv/mortgage traders?

For someone interested in FI/RV/Mortgage trading, here’s what you need to know based on the most helpful WSO content:

Projects/Models Junior Traders Typically Build

1. Automation of Manual Tasks:

   • Automating repetitive daily tasks is a key focus. For example, creating scripts to handle data organization, trade reconciliation, or report generation.
   • Examples include automating pricing sheets, building tools to track PnL, or creating dashboards for market data.

2. Excel and VBA Mastery:

   • Excel is a cornerstone tool on trading desks. Junior traders often build models for pricing, risk management, and trade analysis.
   • VBA is commonly used for automating tasks within Excel, such as creating macros for data manipulation or building logic for risk calculations.

3. Statistical and Regression Models:

   • Building regression models to analyze relationships between different financial instruments (e.g., yield curve spreads, RV trades).
   • Multi-variant linear regression models are often used to identify relative value opportunities, such as comparing 2s10s vs. 5s30s spreads.

4. Trade Idea Generation:

   • Developing tools to identify mispricings or arbitrage opportunities in the market.
   • For example, using PCA (Principal Component Analysis) to analyze rate curves or spreads.

5. Coding and Quantitative Tools:

   • While VBA is a great starting point, more advanced coding skills in Python, R, or SQL are increasingly valuable.
   • Python is particularly useful for data analysis, backtesting strategies, and building more sophisticated models.

Specific to Mortgage/MBS Desks

1. Valuation Models:

   • Learning to value mortgage-backed securities (MBS) is critical. This often involves understanding prepayment models, interest rate sensitivity, and cash flow projections.
   • Coding skills can be applied to build valuation models or analyze raw loan data.

2. Focus on Fixed Income Nuances:

   • Fixed income (FI) trading involves understanding yield curves, spreads, and carry trades. For MBS desks, this extends to analyzing collateral and prepayment risks.

3. Esoteric ABS Desks:

   • Some desks focus on less liquid, esoteric asset-backed securities (ABS), which require a closer understanding of the underlying collateral.

Skills to Learn

1. Excel and VBA:

   • Essential for day-to-day tasks. Start with mastering formulas, conditions, and VBA programming (not just recording macros).

2. Python, R, and SQL:

   • Python is widely used for data analysis and automation. R is great for statistical modeling, and SQL is essential for working with large datasets.

3. Statistics and Math:

   • A strong foundation in statistics and quantitative methods is crucial. Learn how to apply advanced concepts like PCA or regression analysis.

4. Bloomberg Terminal:

   • Proficiency in Bloomberg is often expected. It’s a key tool for accessing market data and analytics.

5. Order Management Systems (OMS):

   • Familiarity with OMS platforms can be a plus, as they are used for executing and managing trades.

Additional Tips

• Start Small: Begin with Excel and VBA projects, then gradually move to Python or R for more complex tasks.
• Learn by Doing: Build small projects like a “what’s priced into FOMC expectations” spreadsheet or a tool to analyze yield curve movements.
• Focus on Fixed Income: FI trading is less automated compared to equities, offering more opportunities to develop hands-on skills.

By mastering these tools and concepts, you’ll be well-prepared to contribute to a trading desk, even without prior experience.

Sources: Preparing for a Jr. Trader/Desk Assistant Role, Q&A: Former BB Rates Trader - Now a prop trader, Insights on Fixed Income Trading, https://www.wallstreetoasis.com/forum/trading/what-are-the-top-volatility-trading-desks-at-jpm-gs-and-what-differentiates-them?customgpt=1, What kind of tools / apps do you wish existed in the industry?