How to break into a role on a structured desk?

Hi everyone, I will begin my Master's in Financial Engineering/Financial Math/Computational Finance in the Fall and am very interested in working on a structured desk. My prior experience has heavily revolved around pricing exotic derivatives and structured products albeit not at a bank but still understand the nuances of such products very well. From what I understand, the same roles vary a lot at different shops so the kind of role that I am looking for is half trading/half quant modeling. So I have a few questions I was hoping some of you could answer- 

1) Is it still worth it to work on a structured desk? Is it still as 'hot' on Wall Street as it once was 10 years ago?

2) How exactly do I go about to finding roles on structured desks at IBs? Do banks have openings for structured desks on their websites or do I have to do a rotational program and eventually apply internally to work on a structured desk? 

3) Strats & modeling is another area that interests me a lot. How do these roles compare to structured desks in terms of pay, quant abilities required, lifestyle etc. 

4) How important are ML/AI skills on Wall Street today? Should I make sure to take a bunch of these courses?

Comments (15)

  • Incoming Analyst in S&T - Equities
Jul 24, 2022 - 11:48pm

Structuring is good, but arguably one of the toughest gigs on the floor. You can't just be a good brainy quant genius, you need to be able to sell and explain a highly complex note structure to a client without getting them too lost in the weeds. Lots of non-intellectual grunt work, too. Even the quant-y people on structuring only spend 10-20% of their time coding. It's also aggressive hours -- most of my S&T class works 10-12 hours a day, but structuring can be anywhere from 12-16 depending on the week. However, it's very rewarding. $1m+ bonuses are not entirely uncommon past the Associate level. If you perform, you get paid. Some years are good and other years are tough, it's definitely a bit more cyclical in nature than other desks. 

Strats/modeling doesn't require the client-facing skills that structuring does. It's almost a pure quant role. You'd likely be supporting a trader in pricing, execution, and risk modeling. ML/AI is used primarily by quant researchers and analysts. Most of these people come from academia, where 20-30+ page research papers are the norm. Lots of in-depth projects where you're analyzing data. It's not like the data science AI/ML though - this is more about testing financial theories/hypotheses in the markets. It's "hypothesis first, model second" as opposed to "model first, conclusions second". 

As for finding roles - networking is your best friend. There's no structuring internships, you have to do either a S&T or Quant Summer Analyst program and pick the structuring desk as one of your rotations. If they happen to be hiring at the time, then they need to like you over the other interns who rotated there as well. As for full-time, I see occasional openings. But 90% of the time these banks want to hire internally (especially BBs) from an intern they know they'd like to train and work with. As opposed to some rando. 

Hope this helps 

Aug 22, 2022 - 9:53am
travybel, what's your opinion? Comment below:

Just had a question - What is the non-intellectual grunt work that structurers do apart from coding?

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Aug 25, 2022 - 11:47am
ninjiompeipakoa, what's your opinion? Comment below:

Analyst in a structuring desk. There's definitely a lot of non-intellectual work including preparing and formatting slide decks for structured products PPT to be pitched to clinets by the VP/D/MD in your desk.

Other than that, doing pricing requests for exotic products (still intellectual but rather repetitive since sales might ask for daily pirce refresh for some exotic structures e.g. dual range accruals with some underlyings).

Performing daily spreadsheet refresh/updates to be sent to sales.

Definitely tough gig, gotta learn a lot yet long hours

Aug 26, 2022 - 5:38am
travybel, what's your opinion? Comment below:

From my understanding, an exotics trader will just execute the trades and keep track of risk and PnL whereas a structurer will lead the charge on developing the exotic products that sales people bring to structurers on behalf of clients.  

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  • Executive Director in S&T - Equities
Aug 27, 2022 - 3:53am

I worked around 3.5-4y in structuring then 5y in Exotics trading up to now with various functions/mandates across both. One of the top 3 US BB banks.

Structuring is a very variable role, you can sort of define it as you become more senior. Some are closer to sales, some are closer to trading working on risk recycling ideas, some are closer to strats developping new models/payoffs, some are "well rounded" and focus on getting the machine to work etc...

That also means you can move later on to any one of these roles if you get highly rated by the relevant team you want to move to based on the overlapping skillset, or just continue going up the ranks in structuring of course.

The role being not well defined, it's up to you to make something out of it. You'll be given grunt work by default as a junior, and the structuring grunt work is initially much more interesting than trading grunt work as it involves learning about payoffs, how clients think of them, pricing lots of variations, optimizing structures or doing some analysis for clients etc...

However after a while most of it becomes a bit dull/mechanical and you have to actively manage your career to progress into whatever direction you want. Lots of structurers get stuck pricing endless amounts of payoffs and miss the big picture, they don't develop a brand so that people associate them with some successful initiative.

That's how you get paid as a structurer, by being perceived as bringing some uniqueness and incremental revenues to the business mix. Maybe you are the "technical guy", maybe you are the "structurer that is good with clients", maybe you are the "structurer that can help the desk recycle book risk through original trading ideas", maybe you are the guy "driving automation of pricing / client service"... etc

But being good at "being a cog" won't get you fired as that work is needed, but you won't get paid, even as a VP, get frustrated, and noone will care as the second year analyst can most likely pick up what you are doing.

It's also a function that can sometimes feel unappreciated, as you are on average paid less than sales and trading, you don't have any "hard number" associated with you, so depend on perception even more. Sometimes sales dump crap on you and if your boss has no balls you can start feeling like some sales savant monkey assistant.

The post from the "Incoming analyst" above is not too bad regarding practicalities, i must however say that except the head of the desk and maybe his 2nd hand, almost noone makes above 1m$ in structuring, and certainly not as associate.

Aug 27, 2022 - 5:32am
travybel, what's your opinion? Comment below:

Thanks for the insight!

I will begin my MFE this coming fall, what are my chances of breaking into structuring as a Master's student? Is it possible in the US? What advice would you give to land a structuring gig given that I am quite familiar with pricing structured derivatives already?

  • Executive Director in S&T - Equities
Aug 27, 2022 - 7:08am

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