Which one should be a better gig(to transition into an IB role later after an MBA)? have an opportunity to pursue either..
As far as I know Market risk involves calculating risk that the value of a portfolio, either an investment portfolio or a trading portfolio, will decrease due to the change in value of the market risk factors.
Credit risk involves going through the financials of the clients and analyzing them with debt ratios etc to determine credit quality..correct me if I am wrong
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how tough is it to move from CRM to trading?
I know a couple of guys moved to trading in long run..more specifically trading structured credit products..more of a quant trader position..hard to get into..
It really depends. I wouldn't call credit "mid-office". The front-mid-back office designations only really matter on the S&T side of things. There is no mid-back office on the banking side. There are support staff, but not like on the S&T side where you have a front office, mid-office to book trades and a back office to do the rest.
I would think it is easier to move from credit or market risk to other front office roles. If you chose market risk, you're likely more inclined to go into S&T, while if you're in credit risk management you're more likely to go into IBD. Both have more skills related to "front office" positions than PWM.
Credit Risk is considered front office at JPMorgan. Not only salaries, but also bonuses are actually the same as for the rest of the IBD.
This was discussed in another forum: //www.wallstreetoasis.com/forums/jpmorgan-ib-risk-bonuses
^its really not, stop with that crap, looks like u got owned in that thread and people gave up arguing with you.
YES, It is. How do you know? Do you work there? Have you talked to people who work there? Have you contacted alumni or somebody knowledgeable and asked? Have you explicitly inquired about bonuses?
I HAVE.
The problem is that 90% of people here in WSO are desperate wanna-be-bankers who know very, very little about what they're talking about. The website is still cool and very useful, but you have to take everything you read with a grain of salt. And yes, you're obviously more than free to take what I just said with a grain of salt and believe whatever you want.
bro get the fuck outta this thread so someone who has a clue can comment
Market Risk Vs Credit Risk Management (Originally Posted: 12/07/2009)
Which one is better in terms of exit opportunities? pay? As far as I know Credit Risk involves analyzing companies(clients) and doing work similar to valuation etc.. Market Risk is about analyzing extreme market movements and monitoring risk by keeping a check on unauthorized trades,VaR modeling etc..
pay should be the same at analyst level. credit risk is your corp fin/ib path if you want to move into coverage. market risk is your markets/S&T path.
Credit risk v Market risk management (Originally Posted: 04/04/2013)
Hi,
I want to know what would be a better choice (between credit & market risk) if i ultimately want to move into equity research.
I know that credit risk involves looking at the financial statements of the company and analysing their industry, but i'm not sure how indepth that analysis is. Also i've been told there isn't much financial modelling (i.e. DCF) involved in the role.
Market risk focuses more on the trading desk's activities and stress testing/sensitivity analysis of current and prospective trades. Although from this perspective it's not relevant to research i've heard market risk makes more use of the knowledge from the CFA.
Is anyone able to confirm/elaborate on any of the above and provide some advice?
Much appreciated.
Def credit risk. You analyze companies using financial analysis and credit risk is heavy on writing when you write credit memorandums. Also I've seen people move from credit risk to credit/equity research n
If your ultimate goal is ER choose Credit Risk. Market Risk analysts deal with, as you wrote above, trading desk. If you would like to switch to Trading, you might consider Market Risk as an option. I believe FRM is more relevant in Market Risk. Not sure about the CFA part though.
Agree with the above. The only exception I would add is that if you are guaranteed Equity Market Risk, in which case directly dealing with the product plus easier access to traders/research (assuming you are on the same floor, which several banks are) would probably be better than Credit Risk.
Thanks everyone for your input.
Is there anyone here that's made that switch? How transferable are the skillsets and what key technical skills did you have to pick up when you got to equity research?
Do the tasks in the typical CRM role fulfil the 'relevant experiences' required for the CFA designation?
I feel that the soft skills you gain from credit risk (i.e. writing credit memorandums, supporting your analysis and pitching why deal is good/bad) would be useful for equity research, but I don't really seeing the technical skills translating over that much. Credit research is mostly based on coverage ratios and liquidity/cash flow metrics that are pretty much set. There's less room for interpretation or assumptions as you would need in equity research. The rest of credit analysis is based on market trends and understanding the company and industry - this part is obviously relevant to equity research.
Bump*
Also, what skills are needed/learned in Market Risk? Thanks in advance.
From my understanding, the skills learned/needed in Market Risk includes VAR and Greeks calculations.
Quants, Market Risk and Credit Risk (Originally Posted: 11/27/2013)
I have recently finished an engineering masters from a top university.
Because I enjoy quantitative things and problems solving (and would like to be surrounded by similar types), I was applying for Market Risk and Quantitative Research roles; I do not have previous financial experience.
Recently I received my first invite from a BB for an interview. However, they said that all Market Risk positions have been filled and that I would be interviewing for Credit Risk.
Would such a role be a dead end? Is it worth interviewing? It seems that Credit is more 'soft' and that the salary is not spectacularly higher than that of a 'secure' high-tech job.
Check out pirho's interview for a better understanding of credit risk, salaries, etc.
Risk Mgmt: MBAs usually go into/end up in credit risk but not market risk. True? (Originally Posted: 05/12/2015)
Heard that MBAs that go into risk management usually end up in credit risk mgmt as opposed to market risk mgmt. 'curious to know if that is true. Is it really that uncommon for an MBA to get into market risk management. Why or why not?
Mbas are usually more qualitative. For market risk you need to have a good quant background so its generally MFE or other quant oriented people who get in the field
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