Credit Research Questions

txjustin's picture
Rank: Neanderthal | banana points 2,610

Is there anybody here who is in credit research? I am specifically looking at equity research versus credit research. The ins, outs, advantages, pay scale, etc. I have some more questions that I can PM/email you.

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Comments (20)

Feb 17, 2011

I believe credit research is more technical and quantitative, and it's probably a very different job depending on whether you do research on investment grade or junk bonds.

I would also like to read some insights on this.

Feb 17, 2011

You can PM a few questions.

Feb 18, 2011

I work as a buyside credit analyst. The sellside research we get from banks is basically of two types: Corporate credit research is generally the same idea as equity research and covers individual names or on a sector. We are focused on HY credit so I can't speak as much to investment grade. The other type is what I would call macro/structured research, which presents ideas about the overall credit market such as CDS curve trade ideas, different asset classes, etc.

Feb 18, 2011

^^^Thanks Kenny, I'm also currently a credit analyst. But I work in the real estate side of the business. Looking to make a move post MBA.

Feb 15, 2012

Between credit research and equity research what are your thoughts about the skills you'd gain as well as opportunities if one were decide to leave?

Someone interested in investing should focus on ____ ?


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Feb 16, 2012

I was wondering the same thing. The forums on here for research is a little specific in pegging down only equity research.

Macro/structured research sounds more interesting to me personally. Kenny, I've also heard people mentioned similar research roles as a strategist. Any ideas of places that make the distinction in the recruiting process for research roles?

Feb 18, 2012

from a cross-capital structure perspective - the credit guys like to do bond math in their head. seriously,if you are doing research the job isn't that different for anything remotely risky, but the personalities are. if you aren't sure, go to a big management company or a less focused fund so you can switch if necessary.

Feb 18, 2012

Credit research is one of the main ways to getting into hedge funds

I don't get how it is possibly career limiting...

Feb 18, 2012

Sounds like a great role to transition to the buyside (Especially if you are able to cover distressed names). Unlike ER, I believe that the credit guys generally sit on the trading floor so you will get a grasp on the trading aspect as well.

Feb 18, 2012

I believe that their is a pretty big difference between regular credit research and FI strategy. FI strategy is more quant based from the positions that I've seen while credit research is more comparable to ER.

But I don't think it'll narrow your skills in that sense of not being able to find something else. I am also trying to work in CR, as I've done an internship and hopefully will be landing a FT gig soon. But CR is a good skill set for getting into AM or HFs as well. Not so sure about PE, but while it may not be as "door opening" as IB analyst or ER associate positions, I'd like to think that it is the next best thing.

In CR (vanilla research), there is more of a distinction between investment grade and HY/distressed research compared with the more sector distinction in ER.

But then again, a lot of this is my own opinion.

Feb 18, 2012

Would be interested in knowing this as well.

Feb 18, 2012

To OP, you pretty much have it totally backwards. Credit research, credit desk analysts, and credit strategy all revolve around generating proprietary trading ideas. Guess what employers need that? Asset managers, mutual funds, hedge funds, etc. Your options are actually greater than if you are in a flow sales or trading role at a bank. Now THOSE tend to pigeon hole you much more so. Additionally, not really sure where you get the "no skill set" thing from. Research and desk analysts have fundamental company specific skills and strategists have macro analysis skills. Sales people generally have no transferable skills outside of relationship sales skills, and the vast majority of traders can make a market but heavily depend on bid ask spread for much of their p&l. Of course there are many exceptions out there, but you're working against the tide generally.

Feb 18, 2012

Short answer: most likely a buyside role - analyst at a credit oriented fund, possibly something in corporate (think slightly diluted IBD exit ops)

Please PM me and I'd be happy to chat with you 1v1.

Feb 18, 2012

What kind of credits will you be covering? It will be easier to jump to buyside if you are working on distressed or high yield (typically).

Feb 18, 2012

Sounds slightly ambiguous if it's a desk analyst role or publishing. Easy check, if on trading floor = desk analyst.

Feb 18, 2012

If it's credit though, don't most research guys sit on trading floor (regardless of being desk or publishing analyst)?

Feb 18, 2012