'I wish more women took an interest in finance ? knowledge is an extremely important part of being financially independent'
? This monologue is part of a series in which people across the financial sector speak to Joris Luyendijk about their working lives
On a slightly chilly September afternoon, we meet near the place where she is quietly studying for her job. A women in her late 20s, she is slightly reserved in the English manner, but with a quick laugh. She describes herself as an 'Evaluator in the fixed income department of a large information services company' and earns �70,000 per year.
"At dinner parties and other social events it tends to be men who want to know what my job entails. It may be because these men work in finance themselves, or that they have investments. I think it's a shame that there are not more women interested in bonds; they are a very good investment, and not just for cautious people. I wish more women took an interest in finance ? knowledge is an extremely important part of being financially independent.
"The biggest misunderstanding about my job? I don't know if many outsiders know it even exists; I often have to explain it.
"In a nutshell what my company does is provide an independent valuation of a fixed income asset ? loans [bonds] that pay a fixed interest. We are independent, meaning we do not hold or trade any of these assets ourselves.
"Companies and governments need money. So they borrow it from investors like pension funds, insurers and other institutions with money entrusted to them and effectively write an 'I owe you' in return. You will read about these things in the news, for instance, when Italy holds an auction to sell government bonds ? this is called the primary market.
"Imagine that at the Italian government auction you bought a so-called '10-year bond'. This means the Italian government promises to repay your investment in 10 years, and to give you a certain yearly percentage ? the interest, or 'coupon payment'. The greater an investment risk that government is deemed to be, the higher the interest payment.
"Now, suppose that the next week you read that the Italian government is in trouble. What if the Italian government is going to default on its debt, meaning that it cannot repay your investment? You worry you are at risk of losing most of your money. Then you would want to sell your bond, right? So you go to the secondary market. There, supply meets demand for all sorts of bonds, both government and corporate.
"What determines the price for your Italian bond? There are all sorts of variables driving that, from individual credit risk, for example, if unemployment rose in Italy during the last financial quarter, to volatile market events such as when Lehman Brothers collapsed. My job is to keep track of those and provide an independent evaluation of the value of these assets; often a regulatory requirement for those who own the bonds.
"Your 10-year Italian bond is traded a lot, because government bonds are what we call 'liquid' ? at most times there will be a considerable number of buyers and sellers, meaning that you have an actual running market. There are also bonds in companies or governments that are traded much less on the secondary market. And some bonds are simply 'held to maturity', where somebody bought them and sat out the 10 years, collecting interest and then getting repaid at the end.
"Now, pension funds and other investors own all these illiquid bonds or 'have them on their books'. They want to know what they are worth, in fact, regulation forces them to keep track. Those illiquid bonds may not have been traded for days or weeks. My company determines their value based on analysis of more liquid assets and the market they trade in currently. Then we apply that analysis and knowledge of credit risks, interest rates etcetera, to provide an evaluated level for that illiquid asset if it were to trade in the current market. We have thousands of clients holding thousands of these assets, paying for an evaluation of each, that is how my department makes its money.
"We may get challenged for our evaluation, and then you have to go back to your market sources and other information and stand up for your decision or revise it. For example, we may set a value at 55, then get an email from a client that this bond traded at 57 yesterday, and we have to look at that trade, contact the trader themselves, determine what has happened since then in that market and for that bond issuer and so on.
"I get into work around 9am. I will have checked my email by then, and I go through all my sources of info. The news, specialised websites, special news services, I try to take in as much as I can. When I get to work, the markets in Asia will have been open for hours, so I have to play catch-up and that continues all through the day. What are the bond markets doing, are there bond auctions, important press conferences? I review what's happening in the world and how this may affect bonds traded in the market.
"My company files an update on the value of thousands of bonds, every night. So from four o'clock onwards we're running yield curves, checking and rechecking our evaluation of these bonds' value, against other information, against certain trades, internal quality checks and checks against other information providers who also value these assets.
"I usually get out between 7 and 8pm, depending on the market. In August most of Europe is on holiday so usually it's really quiet. This year it was crazy with the European debt crisis. It can be a fascinating job: observe what streams of money flow where, see the market respond to rumours. Essentially, everything is interesting if you see it at a high enough level.
"It's also a balancing act, given how busy things can get. I go swimming to relax, and when I am really stressed I lift weights. I am not at all competitive by nature, and feel no need for team sports. When the markets get really rocky, for instance, at the peak of the crisis in 2008, even time for exercise may not be there.
"My job is male-dominated and this has made me develop a thicker skin than I might have otherwise. The office banter can be pretty sharp, and you must learn not to take anything personal. I can handle the shouting, the outbursts and the jokes; I enjoy the jokes ? maybe because I grew up with brothers and went to a traditional university with male-dominated economics classes. On our floor there can be banter about the likelihood of you dying alone, or the reasons you are single. There are less likely to be jokes about my weight, or about men's hair loss. You just know when somebody has gone too far. When the markets are volatile, the stress carries over to the work floor and people need to blow off steam. Don't take it personal and tell them to eff off, that's the drill.
"I have learned useful things in a male-dominated environment; the value of compartmentalisation. Women will often encourage you to have a conversation about whatever it is that's bothering you, but it can be good to not ask about that, to separate the personal entirely from the professional.
"With my friends who work outside finance, I don't sense envy or tension. I have heard from female colleagues whose dates expected them to pick up the tab, fortunately that never happened to me! I might bring a bottle of champagne rather than wine to a dinner party, to buy off my guilt that I am late, or completely knackered, or that I need to talk about my work for the first 30 minutes.
"I don't think my working in finance affected ? as you so finely put it ? my chances on the 'meat market'. However, I have dated men mainly outside of finance, so no pattern of difference there.
"I have been in this role for a little under 10 years now and I love what I do. It's analytical, you learn to sift through vast amounts of information, to prioritise, react to pressure. The downside is the stress involved in volatile times. I don't make the kinds of amounts that some seem to think people in finance make. I consider myself lucky, there are a lot of people in the financial sector, mainly those in the back offices, who make considerably less while also having much less job security. These are the people who bear the brunt when banks have to cut costs ? either because the banks messed up or because the economy took a hit.
"I could be making more money, possibly at a big bank, but am deliberately at this kind of company. I feel no urge to be at a desk at 6.30 in the morning, in a black suit. At this firm there's no way that colleagues would take shorter maternity leave because they're worried about their jobs."
Nick Barmby Human rights Ann Widdecombe Road trips Tuition fees Boxing
No comments:
Post a Comment