Hi, have a friend at a bank that is currently hiring for a position on the converts desk. I am currently in cash ecm. Have worked with converts on some deals in the past, but would love some insight into exit opportunities coming out of converts. For example, how attainable is corp dev, private credit, IR, MM PE or startup roles?
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Convertible bonds ("converts") offer a unique blend of credit, equity, and volatility exposure, making them a fascinating niche within finance. Based on the most helpful WSO content, here’s what you need to know about exit opportunities from a converts desk:
Corporate Development (Corp Dev):
While not a direct path, the skill set from converts—understanding capital structure, equity-linked financing, and strategic financial instruments—can be leveraged for Corp Dev roles. Networking and showcasing your deal experience will be key.
Private Credit:
Converts provide exposure to credit markets, which can be a stepping stone to private credit roles. Your understanding of credit risk and structuring will be valuable here.
Investor Relations (IR):
The equity-linked nature of converts and your experience communicating complex financial instruments can position you well for IR roles, especially at companies with sophisticated capital structures.
Middle-Market Private Equity (MM PE):
While not the most common exit, your exposure to equity and credit dynamics could be appealing to MM PE firms, particularly those focused on growth equity or structured investments.
Startups:
Converts experience can be relevant for startups, especially those exploring creative financing options. Your ability to navigate complex financial instruments could be a differentiator.
In summary, exit opportunities from a converts desk are diverse but will heavily depend on your ability to network and articulate how your experience aligns with the desired role.
Sources: https://www.wallstreetoasis.com/forum/trading/converts-trading?customgpt=1, Corporate Development: My Experiences and Background, 2017 Commercial/Corporate Banking Bonuses, Breakdown of Post-IB Exit Opportunities, Leveraged Finance Exit Opportunities
I think it depends on what other products the convert desk in question covers. In my current role at EQL we are doing anything from converts, exchangeables to other structures like call spreads, prepaid forwards, collars, stakebuilding and buybacks. I'd imagine the more products the desk is responsible for the more options you have for exits.
Appreciate it man. And by exits are we usually taking about HFs that buy these products? Or maybe credit funds (thinking maybe the skill set translates sort of). I’m assuming there aren’t exits into MM PE right?
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