Interest Rate Derivative Sales
Hi Guys,
I had a question about a junior summer internship offer that you might be able to shed some light on. I've searched the forum, but haven't been able to find anything concrete.
This summer I am considering an internship in Interest Rate Derivatives Sales. I was simply wondering what the job entailed on a daily basis, and what the career prospects were after doing something like this. How is it similar/different from a traditional sales and trading role(if it is different at all)? How is this position perceived on the street? I've looked around and haven't been able to find much information about this group.
Any input would be appreciated.
You didn't search hard enough http://www.wallstreetoasis.com/forums/interest-rate-sales-desk http://www.wallstreetoasis.com/forums/interest-rate-derivatives-jr-sale…
[quote=Boothorbust]You didn't search hard enough http://www.wallstreetoasis.com/forums/interest-rate-sales-desk http://www.wallstreetoasis.com/forums/interest-rate-derivatives-jr-sale…]
I saw those, but as Oreos mentioned they're pretty useless in terms of information. Just looking for some actual insight.
In fairness those threads ^^^^ offer nothing.
Fair enough - I didn't go through them. I hope someone here can actually help you. Good luck.
I have to say I find it a bit weird that they have a specific Rates Derivatives Sales team. They generally have a general Rates Sales team that covers all products and are divided by the clients they cover. Anyway:
What the job entails on a daily basis: The same as any other sales job on the floor.
Career prospects: Keep on doing interest rates derivatives sales and climb the ladder. Maybe move to some other kind of FI derivatives sales that is related, smth like FX. Maybe sell structured rates products or ALM or smth like that.
How is it different from a traditional sales and trading role? It is a traditional sales role. The difference with a trading role is widely covered pretty much anywhere on the internet.
How is it perceived on the street? Broadly speaking, sales guys don't get much credit. The criticism traders and structurers make is lack of knowledge of the product and the market. For that reason I would imagine that Rates Derivatives would get some more credit that others. However that is not smth you should be concerned with. Do it if you think you'll like the job.
Your questions are a bit too broad and open, if you want more info ask smth more specific and I'll try to help.
i agree with maximus that it's weird they specified the derivatives role. i'd try to find out if the floor has a general rate sales role (which would cover anything between cash/bonds to dervatives/swaps, vol). AND another desk specific for derivatives that you got hired into.
if this is the case, then your desk likely is more focused in both product as well as client base. while the generic rate sales group would say... sell a hedge fund both vanilla treasury bonds and swaption vol, your group would focus on finding derivatives solutions for the desk's corporations/insurance/us agency clients.
it will be a traditional sales role but i want to mention the difference between fixed income vs. equity sales. in fixed income, there's only SALES or TRADING. for sales, you provide both market updates and TAKE ORDERS of trades.
in equities, there's SALES, SALES TRADING, and TRADING. In this case, the mirror image of fixed income sales in equities is actually 'SALES TRADING.' SALES in equities is also called 'research sales' -- these people don't take orders and just discuss stocks and trade ideas provided by the firm's equity research division.
this for jp?
Nothing weird about it, PM me with specific questions. I have experience with this role
Thanks for the answers
As some of your mentioned, what really threw me off was that it was a specific desk for derivative sales. It's definitely a field i'm not familiar with so i wasn't sure what to expect.
she_monkey - from what i understand there is a separate desk for rates, fx, etc. and the derivatives desk is specific. From what i was told, it's was predominantly sales, with some risk management elements mixed in.
I've never heard of a separate interest rates desk but it has me thinking.
What exactly would you follow and do on a daily basis? Are are you basically following the same stuff as the people in FI and Rates ? How would such a niche desk compare in terms of compensation, i'm gonna assume it's probably pretty standard across the board for first years?
I had the same questions. I will be starting at a BB this summer in the interest rate derivatives desk. I would really like to know the career path of this role as well as the compensation as first year analyst?
Interest Rate Derivative Sales Interview (Originally Posted: 11/25/2011)
Hi guys,
I have an interview coming up for an IR Derivative Sales role at a BB. I was wondering how technical I could expect this to be? Also, as far as pitching ideas are concerned, do I still prepare a couple of stocks or would it be better to come up with reasons why I would go long/short certain interest rates? Anything else I should prepare for?
Thanks. Appreciate the help.
Know the treasury curve really well...what firm is this with?
Don't worry about stocks. Think treasuries and LIBOR. Also everything in fixed income is based on present value of future cash flows so make sure you are comfortable with discounting. Have a basic understanding of the fed and what they are currently doing and how it will affect the absolute level of rates and shape of the curve. Depending on who you are selling to (hedge funds or corporates) you may get some questions on when it's appropriate to use swaps. Good luck
Basically, you'll be marketing, structuring and taking IR derivatives orders (primarily swaps) for corporate/institutional IRR management. As someone previously mentioned, you should have a solid understanding of the yield curve and what impacts rate movement and be able to structure solutions to mitigate interest rate risk.
do some research and answer these questions: 1) where is the "hump" in the yield curve? 2) how is the slope of the yield curve (2/10 10/30), relative to the past 5-10 years? 3) how has QE affected the Treasury market? 4) where/when does the Fed think rates (FedFunds, 10yr) will stabilize (do you agree/dissagree...why?)
Interest rate derivatives sales for corporate clients (Originally Posted: 01/16/2011)
Can anyone shed some light on how the firm/group is in terms of culture, comp, exit opps.. this would be for an analyst position..how much better/worse is it to work for corporate clients as opposed to institutional? appreciate any insight! thanks
I'm just going to recycle an answer I gave to someone a while back:
From what I've seen, there's greater flexibility if you decide to pursue other opportunities on the Street, especially internationally or to the buy-side. At the buy-side fund I used to work at (100+ Bln aum), none of the PMs, Analysts or traders came from Corporate Desks. They were either former traders or salespersons (mostly traders); all from the institutional side.
It all has to do with the network you build from your trading lines and/or coverage. I personally haven't had direct experience on a Corporate Desk, so someone please feel free to jump in if you've seen otherwise.
But if Corporate Rate Sales is your only offer, I would just grab it. Easier to simply transfer groups after a while, as opposed to remain on the hunt (and run the risk of possibly being left with nothing).
To the Mods: Someone should move this over to the Trading forum.
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