Any AFers here in the ABS space (no matter the capacity i.e., trading, research, etc)? I ask because I currently joined an ABS credit risk group, focusing on auto loan ABS for now, and I wanted to get some insight on what future potential there is out there (currently in NYC). From here, can I go to ABS research? underwriting? trading? anything else related to ABS? Thanks!!
sjv1030 Wrote: ------------------------------------------------------- > Any AFers here in the ABS space (no matter the > capacity i.e., trading, research, etc)? > > I ask because I currently joined an ABS credit > risk group, focusing on auto loan ABS for now, and > I wanted to get some insight on what future > potential there is out there (currently in NYC). > > From here, can I go to ABS research? underwriting? > trading? anything else related to ABS? > > Thanks!! I am currently in the ABS world (RMBS, CMBS, Auto-backed) at a very large commercial bank working mainly with underwriters when they structure the deal, investor reporting, etc. I have been doing this for ~4.5 years and am having a hard time translating my current job skills into a new position. (I’m moving from Chicago to a much, much smaller Midwest city for the Wife). I have learned some good financial modeling skills (structuring deals, waterfalls, OID tax, etc.) and have a decent amount of relationship management skills dealing with institutional investor questions, but have had almost zero luck in transferring these skills. I’ve been networking like crazy to pretty much no success. I’m trying to transfer into a buy-side role at some insurance companies in their ALM departments or possibly working at a local boutique investment bank. The structured finance world is pretty brutal right now which greatly limits opportunities. Hopefully it will pick up soon but I’m not too optimistic. Best of luck in your new job. m
^ agreed. structured products was given a horrible reputation from the meltdown. Investors are still scared of the complex fixed income securities. At a point in time, the whole loans in loan form was in more demand than the securitized pieces of them. Equities will be the hot area in the next few years for sure.
i’m in abs/cds/cdo/clo middle office and have been for about 4 years now. i think the skills are very transferable because you’re learing about everything about financial products (ie. the differences between loans and bonds). auto loans aren’t quite as sexy, but they’re a good place to start as you can see prepayment models and interest rate risk. it really depends upon your ultimate goals as for how well the abs world will work for you, but i enjoy the complexity and deeper understanding of financial products.
^ prepayment models on auto loans? are you sure? I would think that’s not very common
Thanks for the feedback everyone. MEP - good luck with the search!! moving to a small mid-west city is tough for financial employment no matter what space you are in. Mar - you’re right that auto loans aren’t sexy. hoping I can move onto other asset classes soon. since you’re in the MO, then I guess yo see these products from a P/L and trading point of view versus waterfall/deal structuring point of view. The trading of these products sounds interesting, but I think I’m def. more interested in what MEP used to do in Chicago. Hopefully, I can make a move come 2013 to be closer to the deal structuring side. Worse case scenario - I go to a rating agency for a while…I guess…
sjv1030 Wrote: ------------------------------------------------------- its pretty important to understand the trading perspective as that is the ultimate demand origination is trying to serve. our guys need to unload the products our bank underwrites so the deal guys do need to make them palatable to investors. also, our trading clients can be anyone from a hedge fund to a pension fund, so understanding the risk tolerance, waterfall/cf structure and risk profile are key to being a good trader. there are a ton of guys who don’t know what they’re dealing in and can get scared when abs stops acting like the bond they had it modeled as…
Starting (or working for a) distressed debt fund would be a pretty sweet gig as well. I networked with a guy that trades whole loans but he’s not looking to hire. Most Insurance companies (big where I’m looking to move to) have structured depts - MBS/Private Placement/etc. but getting in is next to impossible. I even have good contacts in a neighboring department (an MD) but they want someone with an MBA and/or CFA. I’ve passed L1, with not enough experience analyzing credit structures, etc. apparently for any of these roles. Very frustrating. m
iteracom Wrote: ------------------------------------------------------- > ^ prepayment models on auto loans? are you sure? I > would think that’s not very common refinancing or payoff when a car is sold are both forms or prepayments. auto loans are some of the most succeptable to prepayments.