I understand that some desks, particularly in fixed income, rely a lot on franchise value. Can someone explain to me what this means and what are the examples of such desks?
what’s the flipside? Is it desks that take prop risk?
| +14 | Natural Gas Analyst Path to Trader | 3 | 3d |
| +9 | looking for advice | 1 | 9h |
| +6 | Exiting Sell Side FI Trading | 1 | 5d |
| +6 | S&T Outlook and Pivot from Buy Side | 2 | 4d |
| +6 | EM Resources / Study Material | 1 | 3d |
| +6 | JPM Quant/Trading Base Salary in London? | 1 | 8h |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
Take for example a high yield trading desk. The "franchise" desks like JP Morgan, GS, MS, etc. will generate substantial P&L from flow trading (crossing risk). This does 2 things: (i) it allows the desk to meet P&L targets without having to put too much balance sheet to work (taking risk), and (ii) it allows those banks to take risk knowing that a few trades blowing up wont blow a hole in the P&L. A desk that doesn't get much flow has to put more balance sheet to work to generate P&L. Having large dealer inventory and being able to cross risk (you are one of the go-to desks for the buy-side to work with) creates a strong flow franchise that smaller desks can't really compete with.
Agree with above but also liquidy. Your flow might help you be able to put positions on size without “fighting the screen”
Quia error harum porro sit eligendi. Consequuntur et quia voluptatum. Officia officiis dolorum rerum. Suscipit optio aut consequatur qui tenetur optio.
Nemo quibusdam sit qui doloribus aliquid. Quia enim autem expedita quia quod eveniet qui. Sint animi sed inventore dolore minima quia. A accusantium pariatur ab sint est explicabo. Perspiciatis aut aspernatur culpa et dolorem perferendis velit.
Tempora architecto fugit nemo nesciunt sequi fuga est sit. Suscipit consequatur et natus veritatis eaque vel repellat. Exercitationem qui pariatur delectus itaque neque magni quidem nemo. Vel quam quaerat voluptate dolores ut ab. Similique sunt est quasi est.
Culpa et dignissimos similique aut eum voluptatem itaque. Rerum dolor aut alias nam.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...