As Wall Street’s investment banking business shrinks, job opportunities are emerging in the fixed income world.
Demand for fixed income analysts, fund managers, traders and other jobs appear to be holding steady as the rest of the financial services industry falters. There are opportunities across geographies, in large and small firms and at different experience levels. Demand is strong in munis, corporates, emerging markets and structured products.
Best Six Months in Years
“This is our best six months in a number of years," said Scott Hedberg, managing principal of Hedberg Search, a Minneapolis-based investment management recruiting firm that handles fixed-income jobs. “Clients are calling us," Hedberg tells eFinancialCareers. "There is definitely an uptick. It seems that everybody is hiring more.”
Some displaced Wall Street workers are looking to move to these jobs, but experts caution that it’s not easy to make the transition. Those that want to try the switch will need to rely on their personal networks rather than recruiters.
Transferring Skills from Equity to Fixed Income
In some cases, it may be worth a try since some of the skills in jobs such as equity analysts are transferable to fixed income roles. Even experienced fixed income job seekers, however, need to keep their salary expectations realistic as pay is never expected to reach pre-recession levels.
“When our clients say they want a municipal analyst, they don’t want an equity guy they have to train,” said Hedberg.
The rise in fixed income investing is a sign that investors are worried about the unpredictability of the stock market. Rising worries about defaults may be bolstering demand for municipal analysts though it's difficult to know for sure.
NFMA Has 30 Jobs Listed
The National Federation of Municipal Analysts (NFMA) has about 30 jobs listed on its Web site, about 50 percent higher than it was last year. Membership in the NFMA is up 11 percent this year, according to executive director Lisa Good.
“I wouldn’t describe it as a boom,” said Good, who isn’t sure if the rise in job postings is the result of more opportunities being available or increased awareness of the NFMA. “Many of these jobs are opened for people with less experience … There are still plenty of good analysts looking for jobs.”
CFA is an Asset
Having a Charted Financial Analyst (CFA) designation is an asset in landing these jobs. The fixed income part of the CFA exam is more geared toward corporate bonds rather than munis. Good notes that some skills required to get the CFA are applicable to munis since in addition to examining govern balance sheets, analysts need to review non-profits such as hospitals that are similar to corporations. About 15 percent of muni analysts are CFAs, according to Hedberg. There is no designation for muni analysts though the idea has been discussed. More corporate bond analysts are CFAs, he said.
Employers are keen on muni and corporate candidates with experience at the ratings agencies, but that alone won’t get a job seeker hired because while these candidates understand credit quality, they lack critical experience valuing bonds, said Hedberg.
Comp $200,000 and Higher for Senior Experienced Pros
Analyst jobs pay between $65,000 and $95,000 a year for newer employees and $125,000-$200,000 for more experienced workers. Managers and senior-level fixed income analysts can do much better. That excludes bonuses. “We are not seeing a big increase in salary right now, but there is a push-up in some cases,” he said.