Equity Research
Would some people who work in Equity Research care to explain in more detail what the job is like?
Day to day responsibilities/what does the average day look like?
What do you cover?
What you like and dislike about it?
Do you recommend going into it or is there another field you would’ve done rather than ER if you could go back and redo it?
Thanks! I just started my CFA studying and wanted to learn more about ER.
Bump
Day to day: hard to say. A lot of Excel work, talking to IR / management sometimes, and reading a lot
Buy side now, worked on the sell-side for quite a bit
Cover: generalist
Like: I love learning about businesses, and not a hypocrite - love to make money buying at lower price and sell it to someone for higher price
Dislike: There is a lot of pressure to add value and it hurts when you are wrong (even when it's just in the short-term). You are never really off work because of the stocks you cover and names you put into the portfolio, that's why you got to really love doing this stuff. I do this for fun without being in the profession.
Do you recommend going into it? I don't recommend or dissuade, you gotta love what you do. Best way to get a feel is to read a 10K, spread the numbers and have a forward view on the company's financial outlook and follow the company as you go along. See if you like doing this, if yes, then go into this industry. If not, go somewhere else.
I do wish I did not work in the sell-side equity research, it did not really in a big way make me a better (long-term value) investor.
Ok dick
if it makes you feel better, working as a long-term value investor won't make you a better investor either
It does, thanks lol.
Average day: Like most jobs, highly variable. At the junior level you are pulled in a lot of directions. I think of my time in 4 buckets, in order of most to least time spent, on average: writing (earnings notes, initiations, thought pieces), modeling, selling (speaking with clients on the buyside and internal salespeople), and idea generation. Your responsibilities will vary based on team resources and trust placed in you by the senior analyst.
Buy side/sell side: Sell side
What do you cover: One of those TMT industries you hear about often
Likes: Intellectually stimulating in that you get to think critically about businesses and make a call based on what you think about the future. Access to senior management is a plus. Ability to speak with and bounce ideas off of smart investors is enjoyable.
Dislikes: Many stakeholders to satisfy: your team, your firm, your clients, your own ambitions, company mgmt. perverse incentives are not uncommon
Recommend? I plan to move to the buyside eventually so view the role as more a means to an end or a training period of sorts. For those with buyside ambitions, ER and IB seem to be the best bets. I would recommend for someone looking to spend 1-4 years learning about an industry and honing technical skills but not sure I would recommend a long term career in the space.
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