HELP - Daily function of a structurer
Hello everyone,
I have a second round interview in 2 days for a position as structurer in a
BB
.
I would like to know if some of you have already had experiences as a structurer, or know structurers in order to know what are the daily missions , what technical questions they might ask me in an interview etc..
Thanking you and wishing you a good afternoon !
Comments ( 11 )
Highly depend on the desk and asset class.
Most day to day task involve updating and maintaining Portfolio Monitoring, verifying and improving tools and data inputs.
Also deal quite a lot with the legal aspect of deals and DD of Counterparties.
While technical questions about the asset class might be rather easy and technical skills depend on the tools used by desk (Python, VBA , SQL),
I found it difficult to answer the basic questions on legal concepts with a structured approach like a lawyer.
Source: Structured Credit Desk
I've worked on cross asset structuring desks and have interviews interns for my desk.
Equities is probably the most established asset class for structured products, there are many types of structurers: origination, pricing, QIS, platform, issuance, etc. Most structurer start their first few years as a 'pricer', then move on to other types of structuring once they've gained decent amount of knowledge.
As a pricer you will be looking at the request from client, pricer them up in a very well built pricer, and advise client on which payoffs and underlying help them meet their target.
To prepare for interview, make sure you know options, greeks, correlation trading, etc. If you have prior experience, exotic options , autocall dynamics, KI/KO, range accruals etc. If you don't have any experience it's about how quick you can learn, expect to be introduced a new payoff and work out the direction. e.g. if I explain to you what is a worst of put, you should be able to tell me whether you long/short correlation when you short this out.
(I've not done commodities, but payoffs for commodities are similar to equities)
Fixed income structuring includes rates, FX and credit, these asset classes are more rates sensitive and often work closely. (Here I'm referring to asset side structuring, financing/securitised products are different beasts)
These tend to be less fast paced than equities, less automated and requires a lot more structuring than pure pricing. The role for junior vs senior structurers are more similar than they would be in equities, you will start looking at yield curves, macros to originate ideas, price it yourself, then push to clients.
Rates basic: bonds , IRS, inflation swap , cap/floor. Rates experienced: callable swaps, CMS, steepeners, YoY inflation, swaptions.
As a rates structurer you also work a lot with credit structurers, as a lot of the payoffs are traded with repacks of a corp bond.
Credit basic: bond credit spreads (z spread, I spread, etc), CDS , how to bootstrap default probability from credit spreads, asset swap, cds cash basis. Credit experienced: XVA, how does 'no accrual on default' work on a CLN, CDS CS01 bucket for a CLN, extinguishing asset swap, CDS index options, default correlations
Note that different to other asset classes where there are more self issued notes and OTCs. Credit structuring is very doc heavy, you need to document your trades very precisely.
Hope this helps!
This was very insightful. What does your client interaction look like, and what does your client base look like for these products? I know RIAs use equity structured products, but do hedge funds and institutional managers as well? Who uses rates products? Also, do you think moving from structuring to either a macro or vol HF is realistic? Thanks!
If you ultimately want to work in a HF , go for flow deriv trading and not exotics. It's quite rare for structurers to move to HF but it does happen. A more natural move is structuring -> asset managers
I think equities (probably commod too) does more with HFs , you want to be the structurer who does vol swaps, var swaps , etc.; not the structurer who does autocalls, as some banks put them in different structuring teams.
Generally speaking the client base is private banks, asset managers, insurers, distributors. As a junior you'll be doing most interaction through your sales, structurer can't say 'done' to clients. Later in you career you go to client meetings and give sales technical support and deal advisory.
Wow thank you very much, very insightful it helps me a lot, thank you!
This is a very insightful post. What would you say are the most probable exit opportunities for a structurer within Fixed Income. Is it easier to go to an asset manager vs becoming a trader?
Structuring to AM and trading are both quite common moves, and structuring to structuring across asset classes is also not rare.
Do it before you get to VP is my best advice
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