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Ivey Sales & Trading Club
Introduction to Sales & Trading
Ivey Sales & Trading Club
September 2nd, 2014
Plan for the Year
Biweekly Meetings: Wednesday Evening’s ~6-7pm
Educational
Hands on (Trade pitches, macroeconomic debates, mock portfolios)
Outside the meetings:
Trade Pitch Workshops
Learn to use Bloomberg / Capital IQ
Mentorship Program –All year
Recruiting Prep – End of November/Beginning of January
Events:
Bank of America Merrill Lynch – October
Industry Speaker Panel - October
Glenn Hadden (Former Global Head of Morgan Stanley Interest Rates Trading) - December
DWA and Finance Review sessions – December
PITCH COMPETITION
The Executives
Tim Brady
Co-president
Sales, RBC
Will Fleming
Co-president
Trading, Morgan Stanley
The Executives
Daniella Chang
VP Marketing
Trading, CIBC
Justin Firmino
VP Finance
Trading, Citigroup
[email protected]@ivey.ca
The Executives
Brett Heron
VP Operations
Research, Paradigm
Mark Stuebing
VP Communications
Trading, Morgan Stanley
[email protected]@ivey.ca
The Sell Side
The Structure of an Investment Bank
Two primary functions:
Financial Advisory: Mergers & Acquisition, Restructuring, Fairness Opinions, Risk Management (Hedging)
Capital Raising: Debt and/or Equity
Industry Groups:
Natural Resources, Oil & Gas, Financial Institutions (FIG), Utilities, Real Estate, Technology Media & Telecom (TMT), Healthcare, Diversified, Financial Sponsors, Industrials etc.
Product Groups:
Mergers & Acquisitions (M&A), Restructuring, Leverage Finance, Debt Capital Markets (DCM), Equity Capital Markets (ECM)
Investment Banking Division (IBD)
Investment Banking Analyst
Analysts generally work on deal teams that include a Managing Director (MD), a Vice President (VP) and an Associate.
At the analyst level, responsibilities include performing the following:
Industry and company research
Financial modeling (ie/ DCF, LBO)
Analysis and valuation (ie/ Trading Comps, Precedent Transactions)
Coordination of client pitchbooks
Drafting of presentations
The Role of Sales
Pitching trade ideas within the primary or secondary
market
In depth understanding of the market, macro economics
and deal flow
Key point of contact for institutional investors
Communicate with investment bankers, trading, sales,
research
Client Facing
The Role of Trading
Agency trader: Manage trades for institutional clients;
goal to have no market impact
Liability trader: Manage a dealer’s trading capital to
encourage market flows and facilitate client orders that
are in the market; goal to lose as little capital as possible
Proprietary trader: Make trades with the dealer's capital; goal is to make a profit for the firm
The Major Asset Classes
Equities
ECM
Ch
ine
se W
all
SellNew Issues
Existing Securities
Research Reports
Corporate
Meetings
Trading Ideas
Trading Execution
Propriety Trading
Sales/Trading/Research
Bu
y S
ide
Clie
nts
Fixed Income: Rates
Interest Rate Products
(“Rates”): Financial
instruments whose value will
fluctuate whenever the
relevant underlying interest
rate environment
Influenced by
macroeconomic conditions
and central banks
Example: US Treasuries
Fixed Income: Credit
Credit Products (“Credit”): The credit asset class relates to the
collection of financial products whose value depends on the credit worthiness of one or more specified entities
Example: BMO Investment Grade Bond
Foreign Exchange
Largest dollar value of transactions daily compared to any other market
Major Currencies:
USD
EUR
GBP
JPY
CAD
CHF
AUD
Goal: understand the drivers of the majors currencies
Commodities
Precious Metals: Gold, silver, platinum and palladium
Other Metals: Base metals such as copper, ferrous metals such as steel and other metals such as uranium
Energy Products: Crude oil (WTI, Brent), natural gas, ethanol, electricity, coal and refined products (e.g. heating oil, gasoline and diesel)
Agricultural products: Grains and oilseeds (corn, wheat, and soybeans), livestock (live cattle and lean hogs), dairy (milk and butter), softs (coffee, cocoa, cotton and sugar), forest (lumber, hardwood pulp, softwood pulp)
