Best Long-Only Asset Managers for Undergraduates
Curious to hear this forum’s thoughts on the best LO shops for undergraduate-level research associates. How would you rank research associate programs at the best-known firms by criteria like compensation, career progression, culture, and WLB? In terms of asset class, I’m personally interested in equities but info on fixed income shops is more than welcome. Information on this forum is generally sparse, and what’s out there seems to be focused on analyst programs at the MBA level.
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Thank you!
This has been well covered before (See: https://www.wallstreetoasis.com/forums/top-asset-management-firms). It's very hard to rank large AMs as their forte varies by asset class and strategies. However, here is a list that I think is largely accurate. You should expect total comp as a first-year research associate to be around 150k:
Equities:
1. Capital Group, Wellington, Fidelity, BlackRock, Dodge & Cox, T. Rowe
2. Putnam, Amundi, Franklin Templeton, MFS
Fixed-Income:
1. PIMCO (in a league of their own)
2. TCW/DoubleLine/Nuveen/BlackRock/PGIM
One thing that might help OP- are any of these notoriously bad at promoting RAs? Or famously good at it?
Yup, definitely interested in hearing about promotion rates
Thanks! I had seen that thread—just wanted to make a thread specific to research associates, since I know the analyst vs associate experience can be different at some shops. Appreciate the answer!
I would describe the above list as accurate for ranking purposes. Only think I would mention is that some of the T1 places pay a little under 150k TC for their first year class (some of this just has to do with bonus structure tho) Happy to give some examples if people would be interested. Overall, wouldn't freak out if you get quoted a number a bit below that at first.
Additionally, I can tell you that PIMCO, Wellington, Dodge & Cox, and Capital aren't the best with internal promotion, while T. Rowe, Fidelity, and BlackRock are better. T. Rowe and BlackRock both emphasize the idea of being promoted internally.
Interesting. Those slow to promote are like the 4 most "prestigious" names so I guess not too surprising
First year comp is a bit inflated for several of those companies (from personal experience & from friends who were recent undergrads from 2019-2021). 120-130k is more reasonable. AM at insurance companies like JH are ~70k FYI.
This is wrong pgim pays 85k base and 20-30k for first years and 10k sign on
Maybe a good way to think about it is that comp at LOs is closer to consulting than banking. Although it was hinted (at a particular LO) that we would outearn consultants, so $140k+ is on the table. Some shops have likely bumped pay, too.
If you want higher TC (~180K to 200K+) out of college, there's a handful of fixed income asset managers that will hire out of undergrad (i.e. former hedge funds turned CLO manager, think Oak Hill, Brigade). Currently at comparable shop and would note that lifestyle drops significantly more than the cash is worth, so I would say as a junior the benefits of starting in a good buyside seat are pretty even with being in a top IB group making $20K more with same / slightly higher hours. Probably would avoid if you're looking for best WLB though.
Former head of my investment club works at Oak Hill and he says the hours are awful, that said, he makes quite a bit more than I do while working more than double the hours
Amundi has a rather terrible reputation, was always told to avoid if I could!
Also—can someone shed more light on Blackrock’s programs? I may be misunderstanding their structure, but it seems to be pretty different from traditional RA roles at other LOs. Is PMG (which seems to be the most coveted) distinct from their fundamental research groups? This question might be worth making another thread, in which case lmk
This is different. PMG is going to be affiliated with things like portfolio construction rather than fundamental research. PMG is important but it is very different from an RA position. You're not going to be researching companies, studying fields, creating reports, and presenting to PMs the same kind of things an RA might be, but you may have chances for all of the aforementioned listed things.
That’s good to know, sounds like I should probably avoid PMG if I’m interested in picking stocks.
Blackrock has very few front office investing seats. It appears OP recently graduated (same here), so do keep that in mind. However, I can attest that Wellington is very slow to promote internally.
OP here, good to know! I’m actually a junior who’ll be interning at a “tier 1” asset manager for equities (not Blackrock), but I’m looking to hedge my bets in case I don’t receive a return offer.
I can attest that although T. Rowe Price is slow to promote internally, it is considerably better at the Junior level than our competitors
How long does Wellington take to promote from Research Associate to Analyst? Also given that the pay bump is significant from RA to Analyst, does that mean that even 3-4 year RAs are getting paid similar to 1-year RA and thus a considerable notch below Analyst?
Thank you!!
By the way—when you say that Blackrock has very few FO roles, is that relative to other LOs? LOs seem to have very few investing roles in general, and I was wondering if you meant that Blackrock was especially competitive for whatever reason.
If you're in the Midwest, Calamos hires right out of school and has a history of promoting from within. Run a number of strategies
Guy from the Midwest here interested in Calamos (work at another top AM). Would you mind if I followed up with a few questions regarding Calamos? Briefly:
1) What are the hours like?
2) What is the comp like?
3) Are they truly long-term growth investors or is more of a trading shop?
4) What is the culture like?
Been a while since I was there but still have friends that work there
1) What are the hours like? Fairly normal, good wl balance. I would say in by 8 out by 5-6 on a normal day
2) What is the comp like? Not sure where this stands but I would say it was fair for being a suburban mutual fund company. Comp starting off for an associate was average.
3) Are they truly long-term growth investors or is more of a trading shop? Long term investors. Obviously if the narrative changes they will make changes as well.
4) What is the culture like? Culture amongst employees is great but John can be a pain. He's old school and wants things done his way. The headquarters are great, free meals, have happy hours after company meetings, and regularly have outings. This is the thing I miss the most about Calamos.
Anyone have any insights about Lord Abbett or Columbia Threadneedle?
Using Tamius Wake's response as a reference, Lord Abbett's RA program checks off the boxes as a program that rotates across asset classes and from what I've heard there's very good exposure to PMs; they take 5-10 RAs from UG iirc
I’m gonna plug Fred Alger here because I had a great experience interning and I’m not currently there so I have no incentive to lie. It’s sometimes overlooked by undergrads because of its smaller AUM, but its funds do well, comp is great, W/L balance is unbelievably good compared to other areas of high finance, and basically everyone is HYPSM or M7 and had previous experience in other top finance roles. Analysts exit well to hedge funds if they so choose to go that route.
From outside looking in, Fred Alger seems like a good shop. Now honest question -turnover seems very high for a LO? A ton of buyside bios are ex. Fred Alger & they've had seemingly 5+ analyst hires last 12 months.
The perspectives here are interesting. @marketmergermaddie with the great advice as usual. I could make a deeper post on the subject but a couple high level thoughts:
1. If you are looking for a LO firm to join out of UG, look for a firm that has a long standing RA program (ideally a mix of alumni from said program who have exited the firm to other places + internal promotes). I'd be wary of firms with too much on either side of the coin (either there's no upward mobility or high turnover at upper levels resulting in higher level of people staying on). You could argue the upper level turnover could be a positive thing with the right spin but I'd emphasize that starting your career in AM initially is really about getting into a stable firm with an experienced boss to give you proper mentorship (less experienced, tenured mentorship if senior people are jumping ship).
2. Not all programs are alike. Some are rotationals that have you working across research, product management, sales, marketing, ops etc, others are solely focused on research but rotate through FI, EQ, Macro etc, others are specifically for one group. How much exposure do you want? Are you open to multiple things or just research? Do you want to specialize (but risk being a specialist in an area that's less attractive long term) or be a jack of all trades (but master of none). Some of this could positively/negatively impact your next role/opportunity.
3. Within the program itself, what is the LT progression? As a new RA, are you wed to modelling and handling notes for your senior analyst/PM or are you eventually graduating to writing pitches, developing investment theses and interfacing with management? Understanding this will help you figure out whether the program is for you on a personal level.
4. Flows vs committed capital. Does your firm/group/fund have to deal with inflows/outflows because they are running mutual funds? If so, what have those flows looked like over the past few years. Heavy outflows are usually coupled with poor recent performance and being in forced sellers mode can be a negative influence on your development/experiences early on. If you are at an insurance AM, for example, you have a stable pool of capital but what kind of risk constraints are you subject to? Checking firms flows/performance can be useful in comparing different firms vs relying on reductive 'well PGIM tier 2, pioneer amundi tier 2, maybe i'll coin flip to decide'.
5. City. Many UG programs for LO typically have a 2-5 year 'program' period. I'd argue the benefits of the program are best absorbed by staying the full duration. Do you want to live in X city for X amount of years? Does flexibility in location matter for you (aka offices for you to bounce around with openings)? Does waking up at 4:30-5:00 AM sound like hell to you? Because if so, be careful with the west coast firms and double-check what their hours expectations are.
6. Finally, masters program placements. Getting a job in AM is fairly competitive given the lack of slots. Take a look at your programs alumnis and see where they have placed for b-school or other masters, if they elected to do so. Some shops are strong locks for H/W/S, others the M7 and others are less established so less of a history. LO's tend to prize the MBA/CFA combo so that should be a path you think about briefly and how it could play out for you.
The TL:DR version, care less about AUM and more about the above. There's no point going to PIMCO/Blackrock because they are 'tier 1' and realize, wait this program isn't going to get me to where i want to be without a lot of effort to pivot.
Wow, this is an amazing answer. Thanks!
I'll add on that interns/FT UGs that can articulate what they want from the above and why 'x' group fits most/all of what they are looking for can stand out a TON. You sound 1000x more genuine than others who stay more general about 'passions for investing, reputable brand name, aum'. When you hear that multiple times over while interviewing candidates, it gives me worry because its harder to identify who will be an excellent short term and long term fit for the group beyond aspects like GPA/school you went to.
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