CDO Desk Experience

Hi all, I summered in a BB S&T Program this past year and accepted an offer to work in Cash CDO structuring. I was only able to rotate through the desk for a three week period, and was wondering if anyone could provide insight into how my FT experience will be different from the summer. I did not work excessively long hours at the desk and obviously did not get to follow a deal through completion. I really enjoyed the desk culture, though, and find the CDO product and technology very interesting. Does anyone work on a CDO desk?

Also, any thoughts on the cyclicality of the product? Compensation expectations?

Thanks.

 

The cash side was included within the S&T Program at my firm. I am not sure how it is structured at other banks. The synthetic side is growing quickly, but was not open for a summer rotation and did not hire from my SA class. However, I did have a lot of exposure to the synthetic guys. Most cash deals are including buckets of synthetics now, so even if you end up in cash, you would have some exposure to syn.

Other than that, I would tell you to talk to recruiters to find out what summer programs CDOs fall under. I don't know enough about other bank's desks to make any useful reccomendations on that end.

 
Best Response

I work on a BB synthetic CDO desk. I would say that that the hours are slightly longer than the average on the trading floor but not too bad and no where near ibanking.

The product is interesting and there is lots of innovation and growth at the moment so if you join a synthetic CDO desk you will be given lots of responsibility quickly. New analysts on our desk are traveling, meeting clients etc. Compensation at the mid to upper levels is excellent.

At the moment synthetic CDOs is a good place to be but there is always a risk things don't last . . .

 

I've been on the desk for almost 2 years, prior to that I have worked in portfolio management and private equity - so a somewhat unusual career!

Regarding the synthetic market, as expected the US bulge bracket feature heavily but the European Banks are surprising strong in this area especailly Deutsche, UBS, BNP and Soc Gen. Historically Europe didn't have a big cash bond market versus the US so there was greater market space for the CDS market when it arrived. Alot of the recent innovation in synthetics such as cpdo seems to come from London.

 

jmayhem is correct.

Be careful however, because many banks are structured so that Structured Finance does fall within the Investment Banking umbrella (which includes IBD, ER and S&T). Structured Finance generally sits within S&T (aka Securities). However, it will not be in their investment banking division (M&A, ECM, DCM, Lev Fin, Rx, Industry Groups)

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