Personality, Persistence and Good Attention to Detail Key to Bond Originators Job
What does a bond originator do?
A bond originator’s primary responsibility is to provide advice to the issuers preparing and executing debt transactions. Originators essentially provide sales coverage to issuers. They help them prepare all the required issuance documents that need to be in place ahead of the issue.
Leading up to the planned issuance, originators would provide advice on what they think are salable terms, namely, size, term, price, ranking of the debt, and covenants.
When a transaction gets launched, it’s the originator who provides feedback from the investors so that the issuer understands what is actually doable.
What does it take to be a good originator?
Like most professional investment jobs, good math skills are a must. A good originator needs to be aggressive, personable and persistent. He or she must also be an original thinker and have very good attention to detail.
Covering issuers is a very difficult job. There are many competing objectives issuers have when awarding business to their investment dealers. Giving the best advice and coverage to an issuer doesn’t always mean you and your firm will automatically be leading an issue. The best originators become trusted confidants of their issuing clients.
How do I become a debt originator?
The best start to becoming a bond originator is to get an undergraduate degree in commerce, mathematics or finance.
On the-job experience through a university co-op program, as well as passing the Canadian Securities Course (CFC) exam are good paths to get an originator’s job.
It can be a good idea to start writing the Chartered Financial Analysts (CFA) designation prior to or at the start of your career.
Is becoming a bond originator a good career decision?
If you are an aggressive, personable, smart and persistent person this could be the career for you. This is a similar job to a bond sales person, but the two differ in some important ways.
The sales or issuance cycle of an originator’s clients (the issuers) is for the average issuer one to three times per year. There is a lot of information and advice given in between issues.
A bond sales person, on the other hand, would be transacting bond trades almost everyday with most of his or her investors. If you are a “deal junkie,” bond sales will likely be a better fit.
If you’re OK with a longer gestation period but a bigger win when your issuer comes to market, being a debt originator could be the right job for you.
