I get a lot of requests for advice. Here are two of them. David, I really appreciate you discussing your trading/haggling strategies in the Education of a Corporate Bond Manager. It’s definitely given me new ideas and helped me get better pricing in my purchases the last couple of years. I still refer to them every few months or so. I have a question about changing jobs in the fixed income industry – I work in a treasury division, managing my company’s cash and short-term investments. I’ve done well, but we use yield-based benchmarks, as part of the portfolio is used to immunize short term liabilities. When I interview with asset management shops, they want previous total return portfolio management experience. Do you know any particular types of firms or sub-industries that use yield-based benchmarks? Does managing to a yield benchmark stunt my learning growth compared to a total return mandate? Yield-based benchmarks exist when: The liability structure being invested against is short (We could need this cash at any moment for business use!) The liability structure is long, but well-defined, such as a bank or insurer that wants predictable income versus their liabilities, and so the […]
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