Capital Market Jobs

 

 

Capital market jobs are best suited for individuals with a background in finance, accounting, mathematics or statistics. However, individuals with a science or engineering degree can also start at an entry-level position of a trainee or associate.[br]

Capital Market Jobs: Roles

Capital market jobs involve three primary functions in relation to a financial product.

·         Researching on the product: Researching in the capital market is similar to that in corporate finance. Important capital market researching skills include analytical, quantitative and accountancy skills. Researchers are primarily responsible for advising salespeople on profitable sales strategies. At a higher level, researchers design, price and develop complex financial products, such as securitizations and derivatives for selling.  

·         Selling the product: This is primarily about relationship management. Capital market sales jobs require thorough understanding and continual learning about the capital markets. Besides tracking changes in the capital markets, sales jobs require disseminating information to their clients, who generally are wealthy individuals, pension funds, retail brokers and institutional investors.

·         Trading: This can be propriety, involving trading the firm’s (employer) money, or flow trading (market making), which involves creating liquidity for the firm’s clients. Trading decisions to buy, hold or sell are made mostly with the help of two tools, technical analysis conducted by capital market researchers or fundamental analysis with the help of corporate news and economic data. In addition, traders use their personal judgment and experience to arrive at a decision.[br]

Capital Market Jobs: Divisions

The capital markets jobs basically involve trading of financial products. The market can be broadly divided into two main divisions:

·         Equity Capital Market (ECM): The most common branch, ECM involves trading shares of different companies.

·         Debt Capital Market (DCM): This involves trading bonds. Since bonds come with a fixed income guarantee, DCM is also acknowledged as fixed income.

 

Besides these, capital market jobs also involve trading in other complex products, such as:

·         Equity-linked bonds: These are bonds that are convertible to shares at a specific price.

·         Securitizations: These are securities issued on the basis of the standing of asset pool of an organization.

·         Derivatives: This includes futures and options.

 

Entry into the capital market is competitive. Capital market jobs are principally offered by investment banks. However, individuals seeking to work in the capital markets can find employment with mutual funds and hedge funds, who are increasingly maintaining their own capital market teams.