Risk Management interview preparation

Questions

100

Traced to a firm

37

Firms

12

Updated

September 2026

Asked at

All firmsUBS14MSCI7BLBlackRock5FTFranklin Templeton3Oaktree Capital Management2Scotiabank2Jane Street1Moody's1Neuberger Berman1PIMCO1SSState Street1TSTruist Securities1

Topic

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Type

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1. 022Which equities have duration?Greeks and sensitivitiesHardtechnicalBLBlackRockRisk and Quantitative Analysis · New York · 2026

   Say this

   Equity duration is how sensitive a stock's price is to the discount rate, and it's driven by how far out the cash flows sit. Long-duration equities are the ones whose value is mostly terminal value: high-growth tech, biotech with no earnings, and long-dated infrastructure and utilities.

   Then walk it

   1. Mechanically it's the same idea as bond duration. Discount cash flows, compute the weighted average time to those cash flows, and that's your rate sensitivity. A company earning nothing today with all the value in year fifteen has enormous duration.
   2. So the long-duration buckets: unprofitable growth software, early-stage biotech, anything valued on a distant terminal value, plus regulated utilities and infrastructure where the cash flows are bond-like and stretch for decades.
   3. The short-duration buckets: value names, banks, energy, cyclicals with high near-term free cash flow and low reinvestment. Their value is front-loaded, so the discount rate matters less.
   4. The empirical check: 2022 is the cleanest natural experiment. As real yields rose, the Nasdaq underperformed value by a huge margin even though earnings held up. That is duration doing the work, not fundamentals.
   5. There's a twist that matters for a risk seat: for financials the rate effect goes the other way through earnings. Banks' net interest margins improve with rates, so their effective duration can be negative. You can't apply a single sign to the whole market.
   6. And utilities are the interesting case, because they have long-duration cash flows and leverage, so they trade as rate proxies. Many managers hold them as bond substitutes and then get surprised when they behave like bonds.

   Where candidates lose it

   Treating this as a trick question or saying equities don't have duration. The interviewer is testing whether you can move a fixed income concept into equities and name the cohorts. And the answer that stands out mentions financials as the exception where the sign flips.

   Expect next

   • Why did long-duration equities sell off so hard in 2022?
   • Do banks have positive or negative equity duration?
   • How would you hedge the rate sensitivity of a growth equity portfolio?

   Reported by candidates at BlackRock (Risk and Quantitative Analysis, New York, 2026). Source: Wall Street Oasis.

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.