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Learning Inflation Derivatives?

DelPiero

Joined
12/27/12
Messages
5
Points
11
I would like to specialize in Inflation Derivatives and learn to become the subject matter expert.

Currently, I work at a capital market software provider that covers all derivative products and I find Rates & Inflation most interesting.

What should be my plan of my action to acquire info on Inflation Derivatives?

Should I:
1- Read Fabozzi fixed income books?
2- do CFA?
3- Do masters in finance (I have been accepted in a SF college)

Note - I am learning a bit of Java programming at work from my coworkers so to learn Inflation from a programming aspect as that help for business knowledge.

Thx in advance for your guidance.
 
Get a job on a market risk or trading desk covering Rates. Rates/govvy desks cover inflation products. TIPS and TIPS asset swaps are the big products traded by banks. That's probably the only way to get good at those products. There are no books on them. TIPS market is very interesting but there isn't much prop trading in it. It's mostly carry trading. There are some opportunities during auctions but thats about it.

You are better off learning about rates in general rather than just inflation products.

Rates in general is a pretty simple. Very linear products. The only fun stuff is in swaptions, short term rates/bond options and cross currency/tenor basis swaps.
 
Thanks Joy for your response.
I've tried applying but no luck. In the meantime, I aim to beef up on my Finance and learn Java Programming for Rates desk.
I have solid relationship with my coworkers who are skilled Rates developers and are encouraging me to switch from analyst role into learning Java programming.

This track is Plan B.
I guess if I continue on this path not much chance to get into trading?
 
Read about the linkers markets in Europe. There's a lot of material published by the big banks about instruments and trading strategies. The math is not complex. The institutions are complex. Read about pension funds while you're at it. They're a big piece of the picture.
 
Yes, thanks Ken. I've managed to get some primers from the banks online providing sales publications, i.e. DB, GS, BarCap, Kerkhof...
Certainly appears Pension Funds are indeed are big piece in terms of hedging Asset-Liability Management.
I know in US, Calpers is the biggest pension fund.

FYI - in terms of Risk books solely on Inflation. I found that UC Berkeley Haas library has these books available. I will head there in the new year.

I have a lot to learn, though from my point of view, I would like to get one source or a given book that I can read from A-Z. That way, it would provide some structure and I can track my learning progress on Inflation.
 
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