ICAP, Cantor, and GFI

ICAP is the biggest, they are strong in equity derivatives, other high touch products.

Cantor is probably best known in the bond market. Mostly treasuries.

Gfi best known in credit derivatives and other OTC derivatives.

Sent you a PM.

"Oh - the ladies ever tell you that you look like a fucking optical illusion?"

Icap is stronger in rates than the other two, in general. especially in rate exotics.

What exactly does an interdealer broker do? How to do they know the information that they know in order to be able to pass that on to their clients (who are IB traders? salesmen?)? What's the payscale like? Do people generally join from undergrad or after some time in IB S&T?

"It is a fine thing to be out on the hills alone. A man can hardly be a beast or a fool alone on a great mountain." - Francis Kilvert (1840-1879)

"Ce serait bien plus beau si je pouvais le dire à quelqu'un." - Samivel

thanks for the info thus far, trade4size, sent you back a pm

"What exactly does an interdealer broker do? How to do they know the information that they know in order to be able to pass that on to their clients (who are IB traders? salesmen?)? What's the payscale like? Do people generally join from undergrad or after some time in IB S&T?"

they faciliate trades between dealers. the dealers show them prices. dont understand what you mean by this "(who are IB traders? salesmen?)? "

they get paid a % of their bro, and they dont usually come from dealers.

In the purest sense Inter dealer brokers facilitate trading by matching buyers and sellers. They do not take proprietary positions and they do not commit capital.

Recent trends have shown that some inter dealer brokers have begun to commit capital, I know specifically that cantor, and gfi both commit capital and act as principal in transactions taking the other side but it will depend on the desk.

Most inter dealer brokers have divisions in the company that provides execution services depending on the product. That is they are sort of acting as an outsourced trader, they get stuck moving issues that are either difficult for the bank to move or for other reasons the banks traders have better uses of their time. In this sense the broker is an extension of the trader acting as eyes and ears. Their performance is measured in beating a relative benchmark. VWAP TWAP etc.

Jimbo if you see any obvious errors please correct me as I dont want to give out the wrong information.

"Oh - the ladies ever tell you that you look like a fucking optical illusion?"

the brokers i speak with only facilitate, they never take any kind of position. they get paid a commission based on the size and product type and can do quite well.

that being said the job certainly isnt for everyone.

Thanks, that makes sense (unlike my questions).

Sorry for this awful sentence, "How to do they know the information that they know in order to be able to pass that on to their clients (who are IB traders? salesmen?)?"

What I meant was, how do they know who wants to buy what, and who has what to sell? Do companies wanting to buy a product just call one broker instead of having to call 10 traders? Is that the idea?

The bit about "who are IB traders" (shockingly rubbish grammar, sorry)....I meant, "are their clients traders or salespeople at an investment bank? I think you've answered this bit. They speak to traders, and facilitate buying and selling for these traders. Do brokers ever speak to salespeople?

Correct me if this is wrong, but this is how I see it... a salesperson at an investment bank will suggest to a client that they purchase product x. The client agrees, on the condition that he can do it at a given price. The salesperson tells a trader what the client wants. The trader tells the broker who has a look around. If the deal is to be done, the broker helps the trader find the product, the trader gets the product, then sells it to the client. The broker gets their commission, the trader gets their's and the salesperson gets theirs. Is that somewhat right?

Cheers.

"It is a fine thing to be out on the hills alone. A man can hardly be a beast or a fool alone on a great mountain." - Francis Kilvert (1840-1879)

"Ce serait bien plus beau si je pouvais le dire à quelqu'un." - Samivel

Thanks for the good post.

That was a great explanation Jimbo! As we say on this side of the pond, absolutely wicked. Cheers for that!

"It is a fine thing to be out on the hills alone. A man can hardly be a beast or a fool alone on a great mountain." - Francis Kilvert (1840-1879)

"Ce serait bien plus beau si je pouvais le dire à quelqu'un." - Samivel