I read the following terms in the context of credit portfolio mgmt in an IB’s risk department. What on earth are “unwinds”? What are market indicators like EDFs and CDS?? Thanks in advance.
unwinds - refers to closing/unwinding a position…i.e. you’re entered into an equity swap and you close (or “unwind”) all or some of your position CDS - credit default swaps, betting on bond defaults EDFs - not sure? European Development Fund?
Thanks for that reply, NCState. Well, my question then is this: area a decent one to break into IB? How would this compare to other associate level positions in IB? The position involves analyzing portfolios involving CDS…typical risk analyses, with interaction with senior mgmt, trading research and finance. What do you think? Once again, thanks for all the info.
EDF = Expected Default Frequency. It’s an indicator of the probability of default of an entity, developed originally by KMV, now Moody’s KMV.