Want A Quick Career Trajectory? Try Working In CLOs (Collateralized Loan Obligations)
In the financial services industry, it’s difficult to predict the next trend for job growth, and professionals eyeing these opportunities must be highly experienced and driven individuals. However, as all industries evolve, finance is changing. “With the spike in demand for Collateralized Loan Obligation (CLO) professionals, there’s been a shift in the industry,” says Eric Vaheb, a Senior Associate within The Execu|Search Group’s Financial Services division. “The potential to maximize yield on a CLO investment is attractive to many of today’s investors as they can buy a pool of actively managed and diverse set of loans.”
Additionally, today’s booming credit market has added to this increase in demand for different investment vehicles. “All of this adds up to exciting opportunities for junior finance professionals,” says Eric. “The CLO field is growing rapidly, and companies are looking to invest in driven professionals who are ready to dive in.”
Most importantly, the pool of talent at these credit funds are so low and the demand for experienced individuals are so high, the opportunity for growth and compensation becomes immense. “When there is a lack of supply and high demand, basic economics teaches us that the product becomes increasingly valuable,” says Eric. Also, because these are smaller organizations, there are simply more opportunities within to learn different parts of the business, and professionals can gain valuable experience early on. To take advantage of the growing demand for CLO professionals, Eric suggests taking these steps:
Get involved early
“Once you’ve begun your career outside of the CLO market, it would be difficult to transition back into it,” explains Eric. “As a result, entry-level finance professionals should consider getting in on the ground floor of these organizations. With so much demand and so little supply, you’ll gain a lot of experience right away and move up quickly.”
Follow the path that best suits you
The number of roles following the fixed income market has been increasing over the past decade. As CLO investors are the main purchasers of the broadly syndicated loan market, there are plenty of career paths available that cover or intersect with the product. From operations, to structuring, to marketing, there are many ways to be involved with these products supported by the CLO industry. Find the best path that suits you!
Study broadly syndicated loans and structured finance
Once again, credit funds are growing and the demand for experienced professionals are as high as ever. As a result, Eric recommends additional learning to get up to speed. “As with any field, there is always a learning curve,” explains Eric. “If you’re more familiar with the banking world, you can ease the stress of your transition by conducting extra research to understand how to navigate this new field.”
