BSc Computational Finance
Shanzheng Ba
Shanzheng Ba is a student on the Joint Bachelor's Degree Program between CityU and Columbia University. He majored in Computational Finance at CityU and he is now in the final year of study at the ColumbiaU. Last summer, he had an internship at Morgan Stanley's New York office, and was then given a return offer. He will be joining the company’s Fixed Income Division, Foreign Exchange Trading and Structuring Team as a full-time analyst on his graduation later this year.
My first rotation was in Foreign Exchange. FX is a 24/7 global market and I usually woke up at 5:30am and listened to the global news whilst washing up. I got into the office before 6:30am and prepared for the morning meetings. We usually had two meetings, one global focusing on G10 currencies and another focusing on the local Latin American markets. Interns are responsible for taking the meeting notes. Interns were not licensed to trade, but we could observe how traders reacted to market news and asked questions about different trading strategies. “Shadowing” best describes my day-to-day position in the trading seat. Markets cool down after 3 pm and then interns have more chance to ask questions. Usually people leave before 5:30pm. At the end of the 3-week rotation, we were asked to present a trade pitch. FX was the most challenging and attracting work during my internship, which is also where I got my return offer from.
In my second rotation, I sat on the private side of fixed income – Securitization and Lending. This role is a banking seat, not a trading seat, and a typical working schedule is 8:30am-8:30pm. Securitization is the process of trenching asset cash flow into new securities. One example is the kind of mortgage-backed securities which started the subprime loan crisis in 2008. Those securities are still issued and traded on the market and are growing fast. My role was to build the cashflow model for consumer loans. The model itself was less math-heavy but focused more on understanding the client’s needs and polishing the securities details. Modeling itself is not rocket science once you get your hands on it. What is more important is to understand the nuance of the goals between originators, credit facilities, and investors. Just to give an example, originators want to pay lower interest, but lower interest makes a bond less attractive to investors. On the contrary, higher interest might result in a lower credit rating, making a bond less attractive. A structurer needs to understand different counterparties’ interests delicately.
My last rotation was in XVA trading – a very niche trading desk that emerged after the financial crisis. It provides a digital option that calls on a default event. The desk is usually busy from 7am-12noon and cools down after lunch time. It is the most quantitative desk in the entire Fixed Income Division and I really enjoyed my learning there.