The Progression of a Fixed Income Trader

Hey monkeys,

I recently accepted a position for after college in fixed income trading. However, I'm really interested in working on the buy side at a fixed income asset manager as an analyst; eventually working my way to a PM. Is it a good career start to accomplish this goal of becoming a PM if I start as a trader on a credit desk? I'm not sure which sector they'll place me on yet, but I know it's in credit.

Any advice or opinions would be awesome!

Comments (27)

Nov 19, 2018

What sector of FI? In munis, where I work, the progression to PM is Trader --> PM, at least at all the firms I've worked at + my coworkers former shops. Credit and quant analysts stay analysts.

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Nov 19, 2018

I think with this separating macro products from micro credit explains most of the differences... most macro products are trader (on occasion, desk analyst) -> PM. whilst micro is much more Analyst -> PM

Nov 27, 2018

Yeah, I know I'll be sitting on a muni desk during my rotational program; but am unsure if that's the desk I'll be starting on after the rotational program.

Nov 19, 2018

@coreytrevor sounds like he's not on the buy-side yet..

Uh.. okay, as with many of these questions, I highly suggest doing some Linkedin research ("blackrock fixed income portfolio manager"). The general path of

sell-side credit research/desk analyst -> buy-side analyst -> PM

should work. Although, I'm not sure how well credit trading would lend itself to working at a traditional AM, maybe better for a fast money credit shop (e.g., Saba).

Nov 27, 2018

Yeah, it's on the sell side. It starts with a rotational program and then I'll be placed on a trade desk after that. But I ultimately would like to end up as a PM on the buy-side. Also, I realize I'd have to jump to a buy-side analyst role first.

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Nov 29, 2018


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Dec 5, 2018

@coreytrevor sounds like he's not on the buy-side yet..

I'm a muni trader in the asset management division of large bank. My PM's mostly came from larger mutual fund complexes also in muni's. I am just reporting what I have seen/heard from my own experiences and theirs. Every single one of my PM's (current shop and the boutique I started at) started their career as a trading assistant on the buy side.

Nov 20, 2018

If you're doing sell side FI trading, going to the buy side will be tough. The progression is essentially is the same as IB: Analyst -> Associate -> VP -> some kind of director/MD. You'll start running book at late Associate/VP level, so life gets more interesting. But if you want to be a PM get out ASAP, as you will not be taught the same skill set. Most people that start on the sell side stay on the sell side in FI trading.

Nov 21, 2018

When you say FI, you're talking about Munis/Credit right? I feel like macro funds usually want sell-side traders. In credit, makes more sense to get desk analysts than traders (as @princepieman says above)

Nov 22, 2018

why the difference between rates and credit so mcuh?

Nov 22, 2018

I'm talking about munis, corps (credit), mbs, abs, etc. It's just tough to get into a fund from sell side trading because the skill set is so different. I'm speaking from personal experience. And the reason is because a lot of funds have entry level trader positions where you are groomed to be a PM. They don't look to the sell side for recruiting, they do it direct out of undergrad. So don't do sell side FI trading unless you plan on staying. All of this doesn't apply to macro HF's, no experience in that corridor - so if that's what you're referring too then disregard my comment.

Nov 27, 2018

Yes, I'm talking munis, corporates, HY, and some exposure to ABS. I'll be in a rotational program and then placed on a desk after, but I do not know which desk until towards the end of my program.

Nov 25, 2018

Moves to do happen but it tends to be guys who are more senior (10+ years of experience) leveraging their relationships to make the jump. Generally these guys will move to more hedge fund type strategies, but I have seen some guys make location driven moves to Tier II real money type players.

As a junior person, you are basically going to have to start over when moving from the sell-side to the buy side. I used to work with someone who after 2 years in credit trading had the opportunity to be a junior trader/analyst at one of the firms mentioned above and the pay cut was pretty big and even bigger when you factor in that he was going to be promoted to associate in the next year or so.

If you really want to make this jump, I would crush it as an analyst on your desk and then after a 1.5-2 years let your boss know that the sell-side is not for you and that you are thinking you might be interested in making a move to the buy side. He will most likely be understanding and be more than willing to help.

Nov 27, 2018

Got it, thanks! To be honest, I may end up loving the sell-side after my term and want to stay. I won't know for sure until I'm in the role, but I have had about 2 years experience in internships on the buy side at a CRE fund and a fixed income AM, so I'm still getting a taste of the industry and what part of the puzzle I ultimately want to end up in.

Nov 26, 2018

Speaking from the credit side of things:

The end goal of a Credit Trader on the SS is to 1.) get a bigger book of risk, and 2.) to 'keep your seat' for as long as possible. If you're trading a massive book, and you don't blow yourself up, than you should be VERY WELL compensated. Which is why many ultimately stay. Its tough as a 2nd year trader to switch from $200k+ to <$100k with the HOPE of someday managing $$.

However, if you want to be an PM/Investor, you should be looking to make the jump to an fundamental or analyst role . I say this b/c the majority of Credit shops are built on the Analyst -> PM model. And although most credit traders are required to sit as desk analysts, buyside firms want to make sure that you can TRULY evaluate and model from a long-term investor perspective rather than a trading oriented setting.

FYI- I made the switch 5 years ago and have no regrets.

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Nov 27, 2018

Exactly! And I'm currently interning on the buy side as a credit analyst intern for an AM. I am okay with the pay cut (or at least I say that now...) if it means being able to be in the finance facet that I'm most interested in. I currently am doing a lot of research and models that are predominately fundamental and longer-term and seem to be pretty decent compared to my peers.

How in-demand is a junior SS FI Trader with the capability and internship experience on the BS at an AM in an analyst role for AM shops? Also, this firm will be paying for all my licenses and CFA levels... so I hope to have my CFA done before I transfer (already finished L1).

Nov 28, 2018

If you're interested in analyzing credits, then the desk analyst role on the sell-side is great and is a natural progression to the buy-side analyst, and eventually to the PM role. Probably easier to make the jump from this role than the trading role.

If you start off trading on the sell-side, you can still go to the buy-side, but it's likely not to be in an "analyst" role and would be more of an execution trader role with the move eventually to being a PM. It could be a hybrid type of role, but probably depends on the specific job.

Both roles can get you to being a PM (in credit), but it's more a function of what you're interested in and where your skill-set aligns. I'd be more focused on figuring that out rather than figuring out "how to get to the buy-side", as that will come as you're good at your job.

Source: credit desk analyst experience

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Nov 29, 2018

Thanks this was a lot of help! Yeah, like I was kind of mentioning earlier, I'm just coming out of undergrad, sitting for CFA L1, and just getting my feet wet in the industry (outside of internships and "relevant theoretical school work") so I'm taking this first year in the rotational program as a learning experience and plan on soaking up all the knowledge I can as I figure out where my true passions lie... I'm pretty sure its in credit, but who knows! Maybe I'll end up falling in love with some other asset class along the way.

I appreciate your insight and advice.

Nov 29, 2018

Trader skillset is so different from a PM... trading is the dark side of investment, all traders think short term while a PM is totally the opposite. A trader tries to beat the market with technical analysis while a PM mostly does it with fundamental analysis. Also traders have a high risk of burn out. I personally know a lot of extraders with deep psycological problems and cannot work any more. I strongly recommend not to start your career in trading. Thank me later.

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Dec 6, 2018
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