Fixed Income Trading Desks: What Each One Trades and How It Earns

Fixed income does not mean what is on your pension statement

Most people meet the phrase "fixed income" for the first time on a retirement statement, where it labels the boring, safe slice of a portfolio next to a riskier stock allocation. On a trading floor it means something else entirely: the desks that trade government bonds, corporate debt, mortgages and the short term cash market, staffed by people who would laugh at "boring."

This page is the map: the eight desks that make up that floor, what each one actually trades, how a desk makes money at all, how the naming works across ten different banks, and how the whole business changed after 2008. Every desk gets its own guide in more depth; this one is where you decide which door to open first.

Two audiences read a page like this for different reasons, and both are welcome here. One is applying for a seat and wants the map before choosing where to interview. The other has no plans to work on a trading floor at all and simply wants to understand how the largest part of the world's capital markets actually functions, since almost nothing taught about "the bond market" in a classroom describes the desks that make it move.

What FICC actually groups together

FICC is the term every dealer bank uses for this half of the trading floor: fixed income, currencies and commodities. Bank of America's own description of its Global Markets business, for example, spans "market-making, financing, risk management, securities clearing and settlement across fixed-income, currency, commodities and equity markets." Equities usually sit right next to FICC, sometimes inside the very same reporting segment, sometimes run as its own line.

This site covers the fixed income half only: rates, credit and securitized products, plus the desks built around them. A few things sit outside that scope on purpose:

• Currencies and commodities trading are the other two letters in FICC and are large businesses in their own right, but they are not covered here.
• Equities sales and trading, often reported alongside FICC at the same bank, is a separate floor with its own products and its own hiring process.
• No page here is about a single bank. The ten dealer banks named throughout are covered because their desks are the ones candidates and learners actually ask about, not because any one of them is the subject.

The eight desks, at a glance

Eight desks make up the fixed income floor this site covers. Some sit inside a bank's cash market franchise, some are almost entirely about financing, and one or two barely resemble "trading" at all in the retail sense of the word.

Each desk has a guide of its own, linked from its row: what it trades, how it earns, what a junior does there and what its interview tests.

The eight also split along a few useful lines that the table alone will not show you. Rates and repo trade the most liquid, most heavily electronic instruments on the floor and lean furthest toward flow. Distressed debt and CLOs sit at the other end: illiquid, judgment-heavy, and closer to holding a position than pricing a stream of orders.

Credit and high yield sit in between, both trading the same kind of instrument, a corporate bond, at two very different points on the liquidity spectrum. Securitized products and emerging markets credit each carry a structural quirk the others do not: prepayment risk on the former, sovereign and currency risk on the latter.

One business, six names

Ten dealer banks, six different names for the same kind of business, and four of them landed on the exact same one. Bank of America, Barclays, BNP Paribas and UBS all call it Global Markets. J.P. Morgan and Citi both call it Markets. The other four, Goldman Sachs, Morgan Stanley, Deutsche Bank and HSBC, each use a name none of the others do.

The overlap does not make the picture simpler. Two banks sharing a label still run entirely separate hiring processes, so "Global Markets internship" alone will not tell you which of four employers a posting belongs to.

This is not marketing polish, it is history. A bank's name for its trading floor usually reflects whatever it was called the last time the segment was reorganised, merged with another business, or renamed after an acquisition, and that clock resets on a different schedule at every bank.

The practical consequence is a job search built on one bank's vocabulary that misses postings at the next. Someone searching only for "FICC and Equities" internships will never find Citi's identical opportunity, because Citi has never called it that.

The seats on every desk

Whatever a bank calls the floor, the roles on it are close to universal. Deutsche Bank's own careers site describes its Fixed Income and Currencies business as bringing together "Trading, Structuring, Sales and Financing teams," and Barclays sends its graduates "straight into a sales, trading or structuring role on a specific desk." A fourth seat, quantitative and technical rather than client-facing, shows up under different names at different banks; Goldman Sachs calls it Strats.

Goldman Sachs traces the strat function back to 1993 and the launch of SecDB, a risk-management platform built first for its foreign exchange trading business and only later extended across the rest of the firm. Its own account of that history calls strats "multi-disciplinary specialists who blend quantitative finance, engineering, and technology," which is as good a one-line job description as any bank has published for the role.

Flow versus risk

Every seat on a desk sits somewhere on a line between two ways of trading. Flow is a continuous stream of client business, priced fast and turned over quickly. Risk is a position the desk chooses to hold for its own account, for hours, days or longer, because it has a view or because a client trade left inventory behind that has not yet been laid off.

Flow

• Prices and executes a steady stream of client orders
• Earns mainly from the bid to offer spread and volume
• Inventory turns over quickly, trade by trade
• The kind of activity the market-making exemption was written for

Risk

• Holds a directional or relative-value position for the desk itself
• Wins or loses when the market itself moves
• A position can sit on the book for weeks
• Banned outright as short-term proprietary trading, unless it is genuine hedging

No desk is purely one or the other. A rates desk making markets in on-the-run Treasuries looks almost entirely like flow; a distressed debt desk holding a defaulted bond for months while a restructuring plays out looks almost entirely like risk. Most desks, most days, sit somewhere in between.

Where a desk sits on that line matters for a candidate as much as for a bank. A flow-heavy seat rewards speed, pricing discipline and volume, and a junior there learns the market by watching hundreds of small trades a day.

A risk-heavy seat rewards patience and conviction on a much smaller number of positions, and a junior there learns by living with a handful of trades for weeks at a time. Neither is a better place to start a career; they simply teach different instincts.

How the floor makes money

Strip away the products and every desk earns money the same four ways. The bid to offer spread is the base case: quote a price to buy, a price to sell, and capture the difference on client flow. Principal risk-taking is the second, and it is legal precisely because it falls inside the market-making exemption described further down this page: a desk is compensated for warehousing risk a client wants to shed.

Financing is the third, running repo, securities lending and other balance-sheet activity that Barclays, for one, names as its own line item alongside sales and trading. Underwriting and placement fees round it out on new issuance, a fee-based complement to secondary trading rather than a spread at all.

No bank discloses how that revenue splits across the four at the desk level, so treat any specific percentage you read elsewhere with suspicion. What is public is the mechanism, not the mix.

Capital rules shape which of the four a desk leans on. Since 2008, regulators have made banks hold more capital against every asset on the balance sheet, raising the cost of financing, repo and warehousing large positions. That is one reason banks have pushed harder into capital-light, electronic execution wherever a market will support it, even where the underlying product has not changed at all.

A worked example: pricing a client trade

The arithmetic behind "the desk earns the spread" is easiest to see with real numbers, even illustrative ones. Say a client wants to sell $50 million face value of a benchmark 10-year Treasury note, and the rates desk is quoting a two-way market of 99-31+ bid, 100-00 offer, a difference of half of one 32nd of a point.

1. The client sells at the desk's bid, 99-31+. The desk is now long $50 million of the note.
2. Half of a 32nd is 0.015625 percent of face value. On $50 million, that is $7,812.50: the value of the spread on this one trade.
3. Within minutes, the desk lays most of that position off in the interdealer market, keeping only whatever residual risk its limits allow it to hold.
4. The $7,812.50 is the desk's gross revenue on the trade before financing costs, and before anything it makes or loses on the residual position it chose to keep.

Run the same arithmetic on a bond with duration, convexity and coupon in the mix and the numbers get more interesting fast. The bond math interview questions guide walks through that version, and the bond calculator will run any of it against your own numbers.

Two things about that $7,812.50 are worth sitting with. First, it is gross, before the desk's own financing cost of carrying the position and before whatever it costs, in time and in slippage, to lay the risk off.

Second, it depends entirely on the desk actually being asked for a price: no client call, no spread, no revenue at all. That is the whole case for why sales, the seat that brings the client call in, sits next to trading rather than beneath it on every desk.

How big fixed income actually is

Headlines about "trillions in bonds" are easy to skim past without absorbing. SIFMA's own Capital Markets Fact Book puts 2025 long-term US fixed income issuance at $11.5 trillion, up 9.7 percent on the year, split across six markets:

• Treasuries, the largest piece: $4.8 trillion
• Corporate bonds: $2.2 trillion
• Mortgage-backed securities: $1.9 trillion
• Federal agency debt: $1.4 trillion
• Municipal bonds: $587 billion
• Asset-backed securities: $517 billion

Globally, fixed income debt outstanding reached $160.7 trillion in 2025, up 10.6 percent on the year, on $29.9 trillion of global long-term issuance.

Those totals help explain why the desks above rarely trade in isolation. A single large order in Treasuries can move the reference rate every other desk on the floor prices off, which is one reason rates sits at the center of the map rather than as one desk among equals.

$160.7tn

global fixed income debt outstanding

2025, SIFMA

26

NY Fed primary dealers

the list since January 2026; all ten banks here are on it

$587.3bn

US municipal bond issuance

2025, up 14.3% year over year

Munis, inflation and structuring, briefly

Three things come up constantly around this floor without earning a desk of their own here. Municipal bonds are a real market, with US issuance of $587.3 billion in 2025, but a US-only one and thinner on every measure than the eight desks above, which is why this site names them rather than giving them a guide.

Inflation-linked bonds belong to the rates desk rather than standing as a desk of their own. Treasury Inflation-Protected Securities adjust their principal with inflation and are auctioned on a fixed calendar across 5, 10 and 30-year maturities, and they trade as a specialised corner of rates trading.

Structuring, already met above as a seat, cuts across all eight: it is the function that designs the trade a standard bond or swap cannot.

2008 and the Volcker Rule

The 2008 crisis did not just shrink the fixed income floor, it consolidated it. The New York Fed's own record of its primary dealer list shows Merrill Lynch Government Securities removed from the list "as a result of the acquisition of Merrill Lynch and Co. by Bank of America Corporation," and Bear Stearns removed the same way after its acquisition by J.P. Morgan. Two of today's largest dealers grew, in part, by absorbing two of that era's.

The regulatory response, the Volcker Rule, is routinely summarised as "banks can't take risk anymore," and that is not what it says. Enacted as part of Dodd-Frank in 2010 and finalised by five regulators in 2013, the rule bans short-term proprietary trading but explicitly carves out market making: a trading desk may hold inventory in a security so long as that inventory is "designed not to exceed, on an ongoing basis, the reasonably expected near-term demands of customers."

Underwriting gets a matching carve-out, tied to the securities a desk is actually distributing rather than a speculative position. Risk-mitigating hedging is exempted separately, so long as it is designed to reduce a specific, identifiable risk and the desk documents the reasoning when it puts the hedge on rather than after the fact.

The United States is the only market with a rule shaped quite like this one. The United Kingdom answered the same crisis with ring-fencing, separating retail deposit-taking from wholesale and investment banking rather than restricting proprietary risk directly, and the European Union's own version of the idea was never adopted across the bloc. A rule learned for a US desk does not transfer automatically to a London or Frankfurt one.

How electronic the floor really is

Electronic trading has not swept across fixed income evenly, and it has not climbed in a straight line even in the market where it has gone furthest.

US Treasuries, dealer to client

63%

US investment grade bonds

49%

US high yield bonds

32%

Coalition Greenwich data as reported by The DESK (fi-desk.com), for May 2024. Across the full year 2024 the shares were 48% for investment grade and 33% for high yield.

High yield bonds and less liquid corners such as distressed debt and structured credit remain far more voice-traded than investment grade or Treasuries, largely because size and complexity make a purely electronic quote harder to trust on either side.

Who the big dealers are

Ten banks are named throughout this site: Goldman Sachs, J.P. Morgan, Morgan Stanley, Citi, Bank of America, Barclays, Deutsche Bank, BNP Paribas, HSBC and UBS. None of them appears here because of a revenue ranking; no such ranking is published anywhere reliable enough to repeat. All ten appear because all ten share one public, checkable status: each is a current primary dealer of the Federal Reserve Bank of New York.

The list is also a record of consolidation, not a fixed roster. Firms leave it for the same reason Merrill Lynch and Bear Stearns did in 2008, a merger rather than a resignation, and new firms join it too: MUFG Securities Americas was added as recently as January 2026. The dealer community shrank hard after the crisis and has been slowly widening again since, one name at a time.

How to decide where to aim

There is no single right desk, only a better or worse fit for what you actually enjoy. If macro and math pull you more than judgment about individual companies, rates and repo reward the first, while credit and high yield reward the second. If you would rather help design a product than price one, structuring and CLOs are the closest this floor comes to building something from scratch.

Temperament matters as much as interest. Distressed debt and the less liquid corners of structured credit ask you to hold a position that will not resolve for weeks. Rates and investment grade credit offer the most electronic, highest-volume seats on the floor. Emerging markets credit rewards a candidate willing to learn a market most other applicants have never studied.

None of this is a comparison exercise between banks. It is a question of which kind of risk you would rather spend a career pricing.

Where to go from here:

• Fixed income interview questions: what each desk actually asks.
• Why fixed income: the question interviewers ask before any of the technicals.
• Fixed income trader salary: what each seat pays.
• Fixed income exit opportunities: where each desk leads next.
• A day in the life of a fixed income trader: the job, hour by hour.
• The interview readiness check: where your own preparation is thin before you commit to one desk.

The bottom line

"Fixed income" on a trading floor has nothing to do with the safe, boring slice of a retirement account. It is eight desks, each pricing a different kind of risk, sold under six bank-issued names for one underlying business, built on a market-making exemption most people misread as a ban, and reshaped unevenly by two decades of electronic trading. Pick the desk whose risk you would enjoy pricing every day, not the one with the most familiar name.