87 questions reported in Barclays interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
Questions
Easy · Medium
Hard
Model builds
Built in the spreadsheet grid
Currently advertised programmes.
Spread decomposition, liquidity, index arbitrage and dealer inventory. 15 questions
A desk analyst must estimate risk quickly before reaching for a pricing system.
You are long $10 million face value of a corporate bond priced at par with spread duration of 4.5. Its credit spread tightens by 20bp, while Treasury rates are unchanged. Estimate the price and dollar…
A sales-and-trading screen tests whether a candidate understands the cash amount a bond buyer actually pays at settlement.
A corporate bond is quoted at a clean price of 98.40. It has accrued interest of 1.10 points per 100 of par. What price does the buyer pay, and why do traders quote the clean rather than dirty price?
A first-round credit trading screen checks that candidates can interpret a bond quote before discussing a credit view.
A bond has a fixed 5% coupon. Its market price falls from 100 to 95. Does its yield rise or fall, and why?
This tests practical market judgement: preserving information and execution quality matter as much as the directional view.
A portfolio manager needs to sell $40 million face value of a corporate bond that normally trades only $5 million clips. How would you execute without unnecessarily moving the market?
The two halves of the leveraged credit market behave differently, and desks trade both.
Compare leveraged loans and high yield bonds as investments. Which would you rather own if you expect rates to fall?
Credit traders are expected to translate company news into debt-service and spread implications quickly.
A high-yield issuer reports EBITDA 15% below expectations after losing a major customer. The stock falls 25%, but its bonds are down only 2 points. How do you decide whether to sell, hold, or buy the…
Credit-desk interviews test whether an analyst can distinguish useful flow intelligence from a reason to chase a price move.
At 10:00am, three real-money accounts ask for offers in the same issuer's 2029 unsecured bond. The bond has widened 12bp while the issuer's CDS and peer bonds are unchanged. The trader asks whether to…
The structural fact that shapes every credit trading desk.
A single company might have twenty bonds outstanding while it has one common share. What does that do to liquidity, and how has the market adapted?
Essential for credit trading and credit hedge fund interviews.
Explain a credit default swap. If a 5-year CDS trades at 300bp and you think the company will default, what do you do. And what determines your payoff?
A credit desk interview uses this to test hedge selection, basis risk and sizing rather than a memorised CDS definition.
You are long $20 million of a five-year high-yield cash bond. You expect a broad risk-off move over the next month but want to keep the issuer-specific position. Explain how you could hedge, what you…
CLOs buy roughly two thirds of the leveraged loan market. Desks need to understand their behaviour.
Explain a CLO. Where does the equity return come from, and what happens when the portfolio deteriorates?
A recurring relative value trade on credit desks, and a lesson in what arbitrage really requires.
A company's 5-year bond trades at a 300bp spread while its 5-year CDS trades at 250bp. Is there a trade?
A credit-trading desk replay after an issuer misses earnings and the market reprices its bonds.
You cover credit trading for a consumer-products issuer reporting before the open. Make a decision at each stage, then leave a concise trading note for the desk head.
One of the most reliable technical dislocations in credit.
An investment grade issuer is about to be downgraded to high yield. What happens to its bonds, and how would you position?
A credit-trading desk simulation testing trade expression, liquidity discipline and client communication after a fast market move.
You are a credit-trading analyst supporting a desk that holds a large cash-bond inventory after a disappointing earnings release. Use the market updates to prepare a risk note for the desk head and…
Credit statistics, capacity analysis, flex terms and syndication risk. 12 questions
A quick sizing exercise for leveraged finance screens.
A company has $80m of EBITDA. The market can support 4.0x secured debt and 5.5x total debt. How much secured and unsecured debt can it raise?
Levfin desks ask this because leverage depends on adjusted EBITDA, not just reported EBITDA.
What are EBITDA addbacks, and why do lenders care so much about them?
A first-round product question for analysts staffing an acquisition financing.
Compare a Term Loan A with a Term Loan B. Why would a sponsor-backed borrower use both?
A basic fit question for leveraged finance analyst interviews.
What does a leveraged finance group do, and how is it different from debt capital markets?
Acquisition financings often rely on bridge commitments before permanent debt is placed.
What is a bridge loan in leveraged finance?
A staffer asks an analyst to prepare a lender presentation after a sponsor announces an acquisition.
You are preparing the first lender presentation for a sponsor-backed acquisition. What do you need to validate before marketing the financing, and what would you put in the materials?
A key documentation concept in the institutional loan market.
What does covenant-lite mean, and why do investors accept it?
A common follow-up to leverage sizing.
A company has $100m EBITDA and $500m debt priced at 10% cash interest. What is interest coverage, and is it comfortable?
A process question on how committed financing becomes distributed risk.
Walk me through the leveraged loan syndication process.
A leveraged loan pricing question.
A loan has a 9% coupon and is issued at 96 OID. Why does the OID matter to investors?
The question a leveraged finance desk answers before committing capital.
A sponsor asks you to underwrite the debt for a buyout of a business with $150m EBITDA. How do you determine how much debt it can carry, and what would make you say no?
Asked to test whether you understand where a leveraged finance desk actually loses money.
What is market flex, and what happens to the bank if a committed financing cannot be syndicated?
Cyclicality, operating leverage, backlog quality and mid-cycle earnings. 9 questions
A core industrials metric because orders lead reported revenue.
What is book-to-bill and why does it matter for an industrial company?
A basic industrials margin question.
Why do industrial companies often have high operating leverage?
Common in energy, industrials and shipping where asset write-downs are routine.
When must a company impair a long-lived asset, and how does it differ from a goodwill impairment?
A margin-bridge question common when input costs are volatile.
An industrial company says margins fell because of price-cost lag. What does that mean?
A technical coverage question for acquisitions of project-based industrials.
Why can purchase accounting distort the margins of an acquired industrial company with backlog?
An industrials coverage analyst often has to explain quickly whether reported growth reflects end-market demand or acquired and translated revenue.
An industrial company reports revenue rising from $1,000m to $1,120m. Management says the bridge was 6% price, 3% volume, 4% acquisitions and a 1% FX headwind. Reconcile the growth and explain what…
Asked because industrials can burn cash while reported earnings improve.
Why can a manufacturing company burn cash during a revenue recovery?
Critical in industrials, airlines and any legacy manufacturer.
A company has a $2bn defined benefit obligation and $1.4bn of plan assets. How does this appear in the financials, and how do you treat it in valuation?
Industrials and natural resources coverage test this constantly.
An industrial company is trading at 6x EV/EBITDA when its peers historically trade at 9x. Is it cheap?
Reserve-based valuation, commodity decks, contracted cash flows and PPAs. 9 questions
Asked in power-coverage interviews to test why dispatchable generation can earn value even when it runs infrequently.
Explain the difference between energy-market revenue and capacity-market revenue for a gas-fired power plant. Why can a plant that runs only during peak hours still be economically valuable?
The opening question for midstream and infrastructure coverage interviews.
Explain the business model of a pipeline company. How do they generate revenue and what are the key risks?
The foundational E&P valuation question. Every upstream interview starts here.
Walk me through how you value an oil and gas company's reserves. What's the standard approach and what are the key drivers?
The core downstream question. Refining margins are what separates integrated majors from pure-play E&P.
Explain the refining crack spread. What drives refining margins and why are they so volatile?
MLPs were the dominant structure for midstream energy. Understanding them is still relevant for existing infrastructure.
Explain the master limited partnership structure. Why were midstream energy companies organised as MLPs, and what are the key considerations for valuation?
OFS companies are highly cyclical. This tests whether you understand the sector dynamics.
Explain the relationship between oilfield services companies and E&P operators. How does the cycle work, and why are OFS margins so volatile?
Every E&P valuation includes oil price sensitivity. This tests whether you understand the mechanics.
An E&P company has PV10 of $1 billion at $70/bbl oil. What happens to PV10 at $60/bbl and $80/bbl, and why is the relationship non-linear?
The strategic question facing every energy coverage group. The energy transition changes asset values.
How does the energy transition affect the valuation of traditional fossil fuel assets, and how do you model the risk?
Energy M&A often involves asset swaps rather than corporate transactions. This tests sector-specific deal mechanics.
Two large E&P companies propose swapping assets in different basins to consolidate positions. How do you value the swap and ensure it's fair to both parties?
Merger models, accretion/dilution, purchase accounting and deal judgement. 9 questions
The immediate follow-up to the EV vs. equity value question.
Why is cash subtracted when calculating enterprise value? Is all cash treated the same way?
Expect to be asked to compute this with numbers on a whiteboard.
Walk me through calculating WACC. Where does each input come from, and why do we use a target capital structure rather than the current one?
Sector-specific multiple knowledge is what distinguishes prepared candidates.
Which multiple would you use to value: (a) a software company, (b) an airline, (c) a bank, (d) a REIT, (e) an early-stage biotech? Justify each.
A WACC follow-up where candidates reach for the wrong number.
How do you estimate the cost of debt for a WACC? Why not just use the interest expense divided by total debt?
Tests whether you understand that balance sheet movements alone don't touch the income statement.
A company buys $10 of additional inventory, funded entirely with debt. Walk me through the three statements immediately after the purchase, and then tell me what happens when the inventory is…
Tests whether you can handle a non-cash charge that isn't depreciation.
A company writes down $100 of obsolete inventory. Walk me through the three statements at a 25% tax rate.
Asked in industrials and consumer coverage where inventory accounting materially changes reported earnings.
Explain LIFO and FIFO. In a period of rising prices, which produces higher net income, and which company would you rather own?
Follows the WACC question when the interviewer wants to go deeper.
What does beta measure? Walk me through unlevering and relevering beta and explain why the process is necessary.
Asked in retail, restaurant, airline and industrials groups where leases dominate the balance sheet.
Since ASC 842 / IFRS 16, how are operating and finance leases treated? Explain the impact on EBITDA and on leverage metrics, and how you would treat leases when calculating enterprise value.
Duration, curve trades, auctions, basis and central bank reaction. 6 questions
Tests the bond vocabulary a junior needs before discussing a Treasury, gilt or corporate bond quote.
A newly issued five-year bond has a 4% annual coupon and trades at par. If market yields immediately rise to 5%, will the bond trade above or below par? Explain the difference between coupon and…
A first-round rates-desk question testing whether a candidate can turn a curve screen into a clear market description.
The two-year Treasury yield is 4.10% and the ten-year Treasury yield is 4.45%. Is the curve inverted or upward sloping? Calculate the 2s10s slope, and explain one reason a trader cares about its…
A rates-desk scenario lab testing DV01 arithmetic, limit discipline and trade expression after a macro surprise.
You are covering a Treasury book after a hot CPI print. Size the rate-risk exposure, test it against the desk limit, and recommend how to preserve the trade thesis without relying on a hope-driven…
Core product knowledge for any rates or corporate derivatives desk.
Explain an interest rate swap. A corporate has floating rate debt and wants fixed. What do they do, and what is a swap spread?
A rates-desk market replay testing reaction function, positioning and risk expression.
You are on a US rates desk into CPI. Commit to a trade as the release and market colour arrive. You will see the reaction only after making each decision.
Credit trading and research interviews start here.
Define a credit spread. What components does it compensate for, and why do spreads historically exceed what realised default losses would justify?
Ratings, spreads, tenor and covenant packages, and pricing a new issue. 6 questions
A first-round DCM question that checks whether a candidate can turn investor language into an issuer-cost discussion.
An investor says a proposed bond needs a new-issue concession. What does that mean, why might an issuer pay one, and why is the concession not simply a fee paid to the banks?
A DCM associate asks for a recommendation before a client call on how to finance a near-term acquisition.
A BBB consumer company needs $600 million for an acquisition closing in two weeks. It has $400 million of floating-rate revolver debt, stable dollar cash flows, and no near-term maturities. The DCM…
Municipal bonds have unique tax treatment. This tests understanding of the muni market.
What are the key differences between municipal and corporate bonds, and how does tax treatment affect pricing?
The core mechanic of a debt capital markets desk.
An investment grade issuer wants to raise $750m of 10-year notes. Walk me through how you arrive at the coupon.
Tests whether you understand that the two markets are structurally different, not just differently priced.
How does issuing high yield differ from issuing investment grade. Beyond the fact that the coupon is higher?
Convertibles bridge debt and equity. This tests understanding of hybrid securities.
Explain the structure and economics of convertible bonds. When are they appropriate for issuers, and how do you value them?
Stochastic calculus, VaR and expected shortfall, and model limitations. 3 questions
Risk analysts are routinely asked to translate a rate sensitivity into an approximate P&L.
A bond portfolio has a DV01 of $85,000. What does that mean, and what is the approximate P&L if yields rise by 12 basis points? What would you check before relying on the answer?
This mirrors the morning escalation a market-risk analyst may prepare after a desk breaches an approved risk limit.
At 8:30am, a credit-trading desk's expected shortfall is $18m against a $15m limit, up from $11m yesterday. The trader says no meaningful risk was added. What would you investigate, and what would you…
A market-risk interview often tests whether you can diagnose a model exception without overreacting to one data point.
A desk's 99% one-day VaR is breached six times over 250 trading days. How do you interpret that result and investigate it?
Driver-based models, differentiated estimates and defending a rating. 3 questions
A basic modelling screen for research associates who will update consensus-facing earnings models.
A company earns $240 million of net income and has 120 million diluted shares. What is EPS? If a $60 million after-tax charge is excluded from adjusted earnings, what is adjusted EPS, and what must…
The most common analyst deliverable. And a routine modelling test in research interviews.
Build a trading comparables analysis for four peers and apply it to a target. For each peer: calculate equity value from shares and price, bridge to enterprise value with net debt, and compute…
A sell-side research associate review between an earnings call and a client-facing results flash.
Your analyst asks you to review the model and draft flash on a software company that has just reported. Identify the hidden errors that could mislead clients, prioritise the repairs, and write the…
Regulatory capital, ROTE against cost of equity, and why EV is meaningless. 3 questions
The core FIG valuation question. EV/EBITDA doesn't work for financials.
Why doesn't EV/EBITDA work for banks, and what metrics do you use instead?
Post-2008, capital ratios are the first thing FIG analysts discuss. This tests regulatory knowledge.
Explain the key capital ratios that banks must maintain under Basel III. Why do they matter for valuation?
Rate sensitivity is the single most important factor for bank earnings. This tests quantitative understanding.
A bank has $100 billion in interest-earning assets with an average yield of 5% and $80 billion in interest-bearing liabilities with an average cost of 2%. What happens to net interest income if rates…
IPO process and pricing, dilution, lock-ups, greenshoe and market windows. 3 questions
Tests whether you can explain a capital raise designed to protect existing shareholders.
Explain a rights offering. Why might a company use one instead of a broadly marketed follow-on?
The advisory conversation an ECM banker has with a client weekly.
A public company needs to raise $500m of equity. Compare a marketed follow-on, an overnight block trade, and a convertible bond. Which would you recommend and what determines it?
A harder ECM question on the investor base and execution consequences of an equity-linked deal.
Why do convertible-arbitrage investors short a company's stock after buying its convertible bond, and what does that mean for the issuer?
Carry, curve shape, storage economics and policy sensitivity. 2 questions
Sales and trading interviews use a client order to test quote direction, execution and risk awareness.
A dealer quotes USD/JPY at 149.80 / 149.84. A client wants to buy $20m against yen immediately. At what rate do you trade, and what risk does the dealer have after filling the order?
An FX structuring discussion after a client finds that its hedge economics diverged from its USD funding exposure.
A European company funds a US acquisition with USD debt and uses EUR/USD cross-currency swaps to hedge interest and principal. EUR/USD spot moves in its favour, yet the reported hedge mark-to-market…
Greeks, skew, hedging costs and payoff construction. 2 questions
A foundational derivatives question used to check that a candidate can read an option screen correctly.
A stock trades at $92. Classify a $85 call, a $100 call, a $85 put, and a $100 put as in, at, or out of the money. Which positions have intrinsic value today, and why can an out-of-the-money option…
A structuring interview uses this to test whether the candidate can distinguish a conditional rates hedge from a binding swap.
A company expects to issue fixed-rate debt in six months to finance an acquisition, but the acquisition may not close. It is worried that interest rates will rise before then. Explain why a payer…
Same-store sales, unit economics, brand durability and channel shift. 2 questions
Asked in consumer coverage and equity research when promotional investment makes reported revenue diverge from shelf demand.
A packaged-food company invoices retailers $100m at list price, expects $14m of promotional rebates and slotting allowances, and later estimates an additional $3m of retailer claims. What revenue…
A senior consumer coverage case for separating manufacturer revenue from underlying demand before advising on valuation or a transaction.
A beverage manufacturer reports shipments to distributors down 12% year over year. Distributor inventory fell from 10 weeks to 6 weeks, while retailer point-of-sale sales were flat. Management says…
Recovery analysis, capital structure relative value and covenant leakage. 1 question
A product question for hedge funds trading credit through both bonds and derivatives.
What is the CDS-cash basis and why can it become negative or positive?
Pipeline risk-adjusted valuation, reimbursement and patent cliffs. 1 question
A managed-care earnings review tests whether you can turn a headline medical-cost ratio into a clean operating-profit bridge.
A Medicare Advantage insurer reports $1,000m of premium revenue, $840m of medical claims and $80m of administrative expense. Calculate its medical cost ratio and operating profit. If claims rise by…
Capital structure, covenant headroom, FX and interest rate hedging. 1 question
Treasury interviews test whether you understand the rating as a constraint on strategy.
Your company is rated BBB and a proposed acquisition would push you to BBB−. Does it matter? What would you do?
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Company tags reflect where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with Barclays.