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    Hey all,

    For an assessment centre / internship what technical knowledge would one be expected to know for sales and trading?

    Cheers

    C
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    very individual specific, depends a lot on previous experience and how you lead the interview. For example I got asked to describe two different methods of pricing CDS, what the CDS basis is, whereas I know others who interviewed for the same role got just markets oriented.
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    I confirm, it really depends on your CV and how you lead the interview. For example if they ask you what kind of products you like and you say varswap, they can ask you how to hedge it, how to replicate the payoff using calls/puts/log contracts, etc.

    With my math background, I have been asked a lot of technical questions such as:

    - what kind of stochastic volatility do you know? why to use them?
    - what are the loadings in the principal component analysis?
    - how your delta changes when volatility goes up?
    - what's a mean reverting process? give an example.
    - what is the quadratic variation of a brownian motion?
    - how do you replicate a short credit risk position (buying a CDS) using asset swap?
    - how do you hedge a straddle?
    - how does the gamma vary when you get closer to expiration?

    and plenty of other questions!
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    (Original post by DarkSwan)
    I confirm, it really depends on your CV and how you lead the interview. For example if they ask you what kind of products you like and you say varswap, they can ask you how to hedge it, how to replicate the payoff using calls/puts/log contracts, etc.

    With my math background, I have been asked a lot of technical questions such as:

    - what kind of stochastic volatility do you know? why to use them?
    - what are the loadings in the principal component analysis?
    - how your delta changes when volatility goes up?
    - what's a mean reverting process? give an example.
    - what is the quadratic variation of a brownian motion?
    - how do you replicate a short credit risk position (buying a CDS) using asset swap?
    - how do you hedge a straddle?
    - how does the gamma vary when you get closer to expiration?

    and plenty of other questions!
    How about non-maths/non-finance backgrounds? Would the technical knowledge expected be as high as that? Because I could honestly only answer a few of those questions.
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    For sales... not much lol.

    Just have a view on the markets, know a few rate derivs and know what it takes to make a good salesperson.
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    (Original post by rozzr)
    For sales... not much lol.

    Just have a view on the markets, know a few rate derivs and know what it takes to make a good salesperson.
    THIS!!! Don't be scared by what the above guys said. They are good at it and they probably steered the interview in that direction. You have quite a lot of control over what they will ask.
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    Cheers guys,

    I've done some work experience so will obviously go over what I learnt there.

    Also gone over bond yields and what effects them. This seems fairly relevant at the moment with Ireland crisis etc, and even more recently the increase in yields on US T-bills.

    And then just go over swaps, options, futures etc. whilst also forming opinions on current market conditions.

    I don't do an economics related degree, so I think it would be unlikely to get very technical.
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    Since there is a shortage of Sales-specific responses, can somebody please state some of the integral questions that are asked to all Sales candidates (regardless of academic background and work experience)? i.e the pre-requisites.
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    (Original post by The_Libertarian)
    Since there is a shortage of Sales-specific responses, can somebody please state some of the integral questions that are asked to all Sales candidates (regardless of academic background and work experience)? i.e the pre-requisites.
    Sales questions might not necessarily be less technical, especially for FICC. I say do your homework and know the basics. You won't be expected to compute complex mathematical equations on the spot - but you will need to know the difference between the various instruments, how various factors would affect pricing, which would you recommend in a given situation etc.
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    2 questions:

    1) Generally speaking, how big are the derivatives trading desks, relative to the equities and fixed income trading desks, in terms of number of traders?

    2) What technical knowledge do you need if going for a grad role in equities trading?
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    (Original post by rodarte)
    Sales questions might not necessarily be less technical, especially for FICC. I say do your homework and know the basics. You won't be expected to compute complex mathematical equations on the spot - but you will need to know the difference between the various instruments, how various factors would affect pricing, which would you recommend in a given situation etc.
    Thank you.

    If anybody feels that they have any recommendations strong texts/sources on Sales for IB, please post or inbox me.
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    (Original post by Zweihander)
    2 questions:

    1) Generally speaking, how big are the derivatives trading desks, relative to the equities and fixed income trading desks, in terms of number of traders?

    2) What technical knowledge do you need if going for a grad role in equities trading?
    1) On the equities floor it was prob 50/50

    2) cash eq - very little of 'technical knowledge', but for derivs you should know quite a bit about options theory
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    Nice blog acies.
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    (Original post by acies)
    1) On the equities floor it was prob 50/50

    2) cash eq - very little of 'technical knowledge', but for derivs you should know quite a bit about options theory
    what about technical analysis?
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      (Original post by Zweihander)
      what about technical analysis?
      Disgusting.
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      (Original post by President_Ben)
      Disgusting.
      There's actually quite strong evidence to suggest that TA does actually work in the emerging markets. Next to useless in the developed markets though.
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      (Original post by Zweihander)
      what about technical analysis?
      Lol when I did a stint in cash equity trading they had me build/code an excel model to analyse RSI and Bollinger Bands on their sector (large caps.) You should know what it is, but also know to take it with a pinch of salt.

      In answer to your original question (ratio of derivs/cash desks) it depends completely on the product. For example in equities it was bout 50/50 as someone above said. On corporate credit, it was about 70 cash to 30 CDS/index. In rates, if you inlclude all the swaps/structuring/linkers etc there were more "derivs" traders than cash traders (at least at the BB I worked at.)
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      Remember whenever answering technical questions, never try and come off as a know it all because you will get absolutely smoked. There's a big difference between knowing technicals and acting like you can start trading tomorrow.
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        (Original post by Ironuts)
        There's actually quite strong evidence to suggest that TA does actually work in the emerging markets. Next to useless in the developed markets though.
        Go on then, become a multi-billionaire in a flash.
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        (Original post by President_Ben)
        Go on then, become a multi-billionaire in a flash.
        The evidence suggests that even after transaction costs, moving average and filter rules do outperform a buy and hold strategy in some emerging markets... at least that's the case for now. It's not debatable.

        Nobody ever suggested using TA as a trading strategy, nor did anyone suggest that TA or any other strategy could make them a multi-billionaire in a flash. I simply stated that studies show TA works in emerging markets.

        If you wish to cultivate an image of intelligence , which you quite clearly do, I'd stick to being condescending when it's actually justified.
       
       
       
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