CRA or AM investment analyst
I have an offer for a big 3 CRA or a midsize AM analyst rotation program that last 2 years. I know many people don’t go to sell side once they enter buyside but what exit opportunities do you have for AM analysts im a bit stumped any advice would help
Based on the most helpful WSO content, there are several exit opportunities for AM (Asset Management) analysts. If you find that you're not a great investor, you could consider transitioning into infrastructure funds, Private Equity (PE), or Investment Banking (IB).
However, it's important to note that the returns in active management are highly skewed to the very top performers, and at the same time decreasing due to the shift to passive. So, even though senior analysts/PMs make good money, their compensation might not be representative of your earnings potential in 5+ years.
Also, if in ~2-3 years time when you will have had some sort of a track record it turns out that either you are not that brilliant investor or they choose not to promote you if the industry keeps shrinking then you might be stuck on a lower-pay career path than you could have been on.
Remember, the analysts who get the best exit opportunities tend to be the most proactive. This means they reach out to recruiters, network with current PE associates/VPs, and tend to have a few PE firms or specific types of investing/locations that are very obtainable from their situation.
So, weigh your options carefully and choose the path that aligns best with your career goals and interests.
Sources: Exit opps from AM?, Middle Market Banking Exit Ops, what do they look like?, RE Asset Management Analyst exit opps
AM generally is the exit opp: from there you just move between funds, or maybe over to a HF depending on your coverage.
To answer this properly we need to know more about what team you'll be in at the CRA and what rotations you'll be doing at the AM. 75% sure the AM will be the right choice.
For CRA I would doing project finance/infrastructure & a bit of utilities
For AM the rotation options would be fixed income(high yield/structured finance), equities (small cap), passive tracker (products, portfolio management), and client coverage (sales).
Feel free to let me know if my line of thinking differs from your. is the training as rigorous for AM compared to sell side? Are the exit opps in AM really high paying also is HF an option without an MBA?
This is going to sound harsh but I'm really amazed you got this far without knowing anything about the industry or seemingly what you want. If you're interested in infrastructure (which is a pretty interesting sector), maybe the CRA gig will be good (although admittedly CRA exits from that team can be a bit more challenging vs other teams based on what I've seen). If you want to be a fixed income/equities analyst then take the AM and focus on converting one of those rotations into a FT role. Passive and sales probably won't be as interesting.
AM training depends on the firm but if it's well established it should be pretty rigorous. But really, don't go into this with the attitude of looking for an exit. As I said, AM generally is the exit. You're young, take your time, I guarantee if you're curious about your sector and put in the effort to learn it well the money will come in buckets. Whether or not you go into a hedge fund will largely depend on your coverage: for certain strategies it's not relevant but don't take this with a "I have to be doing a HF relevant strategy to make big money" attitude. I doubt an MBA will be very helpful if you're already getting relevant experience.
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