Hedge fund analyst Interview Questions


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J.P. Morgan
Hedge Fund Services, was asked...8 April 2012

What is a Credit default swap?

2 Answers

A credit default swap (CDS) is a financial swap agreement that the seller of the CDS will compensate the buyer in the event of a loan default or other credit event. The buyer of the CDS makes a series of payments (the CDS "fee" or "spread") to the seller and, in exchange, receives a payoff if the loan defaults. Less

Credit defulat swaps acts as insurance because it transfer the risk from buyer of CDS to seller of CDS in case of defualt. Seller of CDS pay face value of loan to buyer of CDS. It is actually non isurance product. CDS is not subjected to regulation governing traditional insurance product. Also, investors can buy and sell protection without owning debt and this is called 'Naked Credit Defualt Swaps' Most importantly, the seller is not required to maintain reserves to cover the protection sold Less


Who has the final decision on derivatives prices.

2 Answers

The director.

This seems to be an invalid question. There are a lot of derivative instruments out there, options, futures, swap and etc and their prices are usually determined by various factors and some could be affected by the supply and demand of the market and for exchanged traded derivative theor market prices can be obtained easily. And i dont think the directors of the company taking position using those instrument have much influence on the price of the derivative. Less

Goldman Sachs

Tell me a time when you had to improve a process

1 Answers

Mentioned the time I automatized some trading

Goldman Sachs

If you were arrested for something that you believed wasn't wrong, what would you do?

1 Answers

Change the law

HCL Technologies

Three golden rules of the accounting

1 Answers

Debit what comes in credit what goes out(real account); Debit the receiver credit the giver(personal account); Debit all expenses and losses credit all income and gains(nominal account) Less


About CV and few accounting and Futures and options related questions

1 Answers

Gave brief description about CV

Solomon Page

"Have you ever used a pivot table? What about a pivot chart? Have you used excel?"

1 Answers

I had excel, pivot charts/tables in my resume, and had already scored perfectly on the excel test. The guy hadn't read anything about me and asked questions already answered. Less

Bear Stearns

How would you deal with an irate hedge fund manager?

1 Answers

Find out the issue and address it as best I can. If I I need to escalate it, I will bring senior people to help. Less

Renaissance Technologies

Yes I’m coming home now I will pick you up

1 Answers

Yes I’m coming home now I will pick you up at the shower and pick up bread

Goldman Sachs

Why would you not join us? (kind of stupid question, but I couldn't give a satisfactory answer)

1 Answers

""" i din't get that much of chance..........! , still now. '''"'

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