HiI know I have already posted this in the careers forum so apologies for anyone reading this again but my interview is tomorrow.I was wondering if anyone can help. I am about to be interviewed for a trainee position at a large index house. Can anyone give me some advise on some good questions i can ask and questions i might be asked. Any help on this would be most appreciatedThank you

The Fabozzi books include general overviews on fixed income indexing, so it is worthwhile having a look there.A typical question to ask/be asked, I guess, is how would you go about replicating an index with a large number of constituents: it would be impossible to buy and hold them all because (i) they could be too many holdings, i..e impractical, (ii) their index weight could be to small to make any realistic sense in your smaller portfolio. Your aim, then, is to make sure you replicate the basic index characteristics (return, risk), while holding a practically manageable portfolio.Perhaps I am stating the obvious here, but one way to deal with this is to run some sort of optimisation whereby your tracking error is minimised (and your return is matching the index) while keeping the number or holdings low. You could also impose other constraints depending on how closely you want to match the index.Hope this helps.Good luck!

Something that would show you prepared for the interview is to go trough their index rules, expecially how do they adjust for corporate actions. Then, think of how a fund tracking the index would trade in order to adjust to any of the changes. At last, think how an arbitrageur would take advantage of it. Once you know this, I suppose a good knowledge of asset allocation theory/basic statistics is all you really need. Most of the index providers do a lot of work for clients to design/calculate custom indices, and they charge good money for it.