Fixed Income Sales

S

sacramento343

A friend of mine in an MBA program was offered the possibility of working in Fixed Income Sales for large ibanks by his finance professor who apparently has connections that can pull this job. The professor claims that after a few years, an established fixed income sales person can bring in 200k-5M per year, but the jobs are far and few in between. There is little or no prospecting involved, most of the clients are repeat business and you have a decent base plus commissions.
If anyone would like to expand or correct my basic understanding, I would be interested to hear what you have to say. If this income potential is completely unrealistic, please say so, and I would be interested in the quality of life a position like this would offer. Thanks!
 
I briefly worked as an analyst for a group that supported an MBS sales desk at a small broker dealer - but they shut down the operation a couple of days after I got hired. I thought the sales jobs seemed cool but not exactly low stress. My impression was that they made 200k-1M but with wide swings from month to month, and most making sub 500k, but I only heard these numbers third hand. I also interviewed with another small bd where the salespeople were treated like independent contractors - they paid for their space and bloombergs and made only comissions. A real eat what you kill setup. I have no idea how much they made, I was interviewing for a different position.

The other impression I have is that these jobs seem to be very different depending on the product and customer base. I think selling vanilla stuff (like corporates) to banks or insurance companies is relationship sales, but selling something with structure or complexity (like CMOs) to money managers or hedge funds can get analytical and creative.

Sounds like a good career path to me if your friend has an in and can deal with the uncertainty. I was interested in doing this at one point but did not want to go to NY, and thought regionals were hard to break into w/o experience or connections.
 
Fixed income pure cash sales is a dying business to some degree. But, the smart salesmen have retooled themselves to sell credit derivatives along with cash products. Those guys do well. The general income is not from prospecting, but from servicing existing clients. Since there is no exchange, sales act as a de facto terminal. Sales is a volatile job. Not only do you have good years and bad years, your product space may also become obselete and leaving you without any usable experience. Not for the faint of heart. But it's good money otherwise.
 
Thanks for the replies.
It was also mentioned to him that (like many sales jobs) it is a lot of phone work, and may be done completely remote. At first, he would of course work in an office, but as seniority is gained, the ability to work from home/abroad/whatever is a possibility. I'm wondering the truth to this as well, or others experience with the practicality of this and how common it is in the industry.

The job has been pitched to him more as the "creative problem solving" type situation, where a institution will come to him with a rough idea of what they want, and a list of their needs, and he will work with them to create a solution. He is figuring since his position will be with larger banks he should have a decent base of 100k-150k or so, then commissions on top of that.

Any more replies are definitely welcome.
 
Can you elaborate a bit as to what caliber of IB this sales job is for? It's a good job because it's pretty niche. And like all sales jobs, there are booms and busts, but if you can close a deal, then good things are coming.
 
I don't really know to tell you the truth. If I had to guess, I would guess maybe something like BoA, or maybe something smaller, I'm not sure. Not Goldman or anything prestigious really. But this is all speculation on my part, sorry I can't elaborate further. His school is not a top 10 B-school, but this finance professor who likes him apparently has connections and is flown to NYC for consulting gigs all the time at various firms.
 
Quote from sacramento343:

The job has been pitched to him more as the "creative problem solving" type situation, where a institution will come to him with a rough idea of what they want, and a list of their needs, and he will work with them to create a solution. He is figuring since his position will be with larger banks he should have a decent base of 100k-150k or so, then commissions on top of that.

Any more replies are definitely welcome.
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This part sounds right. fixed income salesmen aren't idiots. While I'm not entirely sure how accurate this work with client to "create" a solution is, but they do present trades/strategies/ideas to clients all the time. Clients also ask for market colors, etc.

Quote from sacramento343:

Thanks for the replies.
It was also mentioned to him that (like many sales jobs) it is a lot of phone work, and may be done completely remote. At first, he would of course work in an office, but as seniority is gained, the ability to work from home/abroad/whatever is a possibility. I'm wondering the truth to this as well, or others experience with the practicality of this and how common it is in the industry.
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This is funny. Phone work is fine. Everything in fixed is done over the phone. But this work from home thing is fishy. I've NEVER heard of a fixed income sales working from home. It just doesn't make any sense on so many levels.
 
The working at home thing wasn't pitched to him, that was him speculating on the future of the career and wondering about that being a possibility. Obviously, neither one of us is familiar with this kind of sales, hence the questions. Other sales people I know such as mortgage brokers are able to work entirely remote if they chose. of course, now all the mortgage brokers are working unemployment "remote", ha.

Thanks for the answers, I will pass them on.
 
Quote from sacramento343:

The working at home thing wasn't pitched to him, that was him speculating on the future of the career and wondering about that being a possibility. Obviously, neither one of us is familiar with this kind of sales, hence the questions. Other sales people I know such as mortgage brokers are able to work entirely remote if they chose. of course, now all the mortgage brokers are working unemployment "remote", ha.

Thanks for the answers, I will pass them on.
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Yeah - mortgage sales and fixed income sales aren't anywhere close to each other. FI sales deal with institutional clients (ie, hedge funds and asset managers). There's almost nothing in common between the two except some vague sense of being "sales".
 
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