Coffee Catch-Up
At IAM, we ensure our clients interact with industry experts to get the best value for their investments. We caught up with one such expert, IAM’s Associate Director – Capital Markets, Jacob Brady for a coffee.
Read excerpts from our Q&A below:
Hi Jacob!
Thanks for joining us for coffee today. You’ve been at IAM for over 3 years now, we’re interested to learn more about your background and how you came to be part of the Capital Markets team.
1. We understand that back in the day you were pursuing college basketball in the States. How did you transition to a career in fixed income?
I grew up playing basketball and eventually received a scholarship to play in Colorado. My major was Economics, and after graduating and pursuing basketball professionally, I wanted to start my career in finance.
It certainly was an adjustment at first as I had a lot of aspirations of playing professionally, but once I had decided to move away from those goals, I wanted to apply the same work ethic and focus I had with sport to something within financial markets.
2. Building strong client relationships is crucial in this role. Could you walk us through your strategy for effectively covering and servicing clients?
Its all about attention to detail. A lot of clients will have had several different relationships when managing their portfolios, and the way to differentiate yourself from others is to find out what they value and want most from the relationship. Once you know that, you can start to set yourself apart. It’s also always better to be proactive rather than reactive, which is the case with most things really. Clients will appreciate effort made and proactivity when managing their investments, so you always want to make sure you’re on the front foot.
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Now, let’s dive deeper into your expertise and how you operate within the ever-changing financial markets:
3. With your experience in the fixed income market, what are your top picks or insights on the current trends and opportunities in the bond market?
There hasn’t been a better time to invest in bonds than right now, in my opinion. It was only a couple of years ago that investment grade bonds were being issued between 2-3%. Bond investors are now getting upwards of 6%+ for the same rated bonds, which obviously highlights a very different bond market we’re now operating in.
Where we see the most value currently is probably the Australian Tier 2 market, which has been in high demand from our client base, as well as across the market in general. We’re seeing major banks issue deals up to 500m+ investment grade bonds, that are sometimes 3.5x oversubscribed.
4. We understand you cover clients in Sydney as well as Perth. Are there challenges and opportunities you encounter when covering clients in different states?
The obvious challenge is not being on the ground in Perth and being able to meet with clients in person frequently. That’s when what I mentioned about attention to detail and proactivity comes into play. If you can find a way to build the relationship without being face to face, when you finally do make the trip over, you can really solidify yourself because of the efforts you made prior to meeting.
Shifting gears a bit, we’d like to get to know you on a more personal level.
5. You mentioned applying the same work ethic you had to sport, into finance. What are some examples of ways in which you utilize what you learned during your time playing basketball into your profession?
I think there is so much within sport that is used daily for everyone. The obvious answer is working hard, figuring out your role within a team and learning how best to contribute to the team’s overall success. I think the main one that’s very specific to basketball, and something that I’ve found very useful, is being able to move on to the next task.
Because of the pace at which basketball is played and the actual dimensions of the court, if you or someone on your team makes a mistake or even if a good play was made, you have probably a one second timeframe to forget about it and move onto what comes next. You learn to focus on whatever task is in front of you, rather than getting caught up in something that’s already happened, good or bad.
6. What are some of your hobbies or interests outside of the office?
I still try and play basketball with mates when I can, and still love the game, so I’ll usually make sure to tune in during the NBA and NBL seasons. I try and stay active through running and going to gym as much as I can as well. Outside of that, a lot of my former teammates and friends all live in the same area, so always enjoy spending time and catching up with them as much as possible.
Jacob’s Favourite Bonds
What are your favourite bonds at this time?
Lloyds 7.086
- This was Lloyds first time coming to the Australian Tier 2 market, so the new issue premium was very high for this bond. For a very well-established, investment grade issuer to offer an over 7% return for a five-year call date, I think this bond will continue to be standout amongst the IG bond market, and a staple in client portfolios.
UBS 4.375% /Perp
- The UBS perps were initially caught up in the Credit Suisse related issues and saw a heavy sell off across the European banking sector. Now that the dust has settled from the CS events, I think these bonds offer exceptional value for investors. They’re investment grade rated, offering close to a 10% yield and callable in August next year – it’s worth noting UBS are yet to miss a scheduled call date. I see this as an arbitrage opportunity for investors.
If you’d like to know more about this and other securitised transactions, please get in touch.
