Looking to Jump from Credit to Equities
Ignore title… did M&A IB at a BB to start then jumped to a single manager fund mainly focused on L/S, event driven, and distressed credit with a slight involvement in some L/S equities.
Has anyone made the jump from a mainly credit analyst role to equities?
Appreciate any insight.
Based on the most helpful WSO content, making the transition from a credit-focused role to equities is indeed possible, though it may come with its challenges and learning curves. Here are some insights and steps that could help in making the jump:
Leverage Your Analytical Skills: Your experience in M&A and credit analysis has likely honed your ability to assess risk and understand financial statements, which are crucial skills in equity analysis as well.
Understand the Differences: Recognize that while there are similarities, there are also key differences between credit and equity analysis. For instance, equity analysis often involves a deeper dive into the company's growth potential and market opportunities.
Network and Express Interest: Build relationships with professionals in the equities space. Express your interest in transitioning and seek advice from those who have made similar moves.
Highlight Relevant Experience: When applying for roles, highlight your experience in event-driven and distressed credit situations, as these often require an understanding of equity valuation and shareholder value.
Education and Certifications: Consider furthering your education or obtaining certifications relevant to equities, such as the CFA, which can demonstrate your commitment to the field.
Internal Lateral Moves: If possible, look for opportunities within your current fund to get involved with more equity-related projects or to transition to an equities team.
Market Yourself: Position your credit experience as a unique perspective you can bring to an equities role, focusing on how your background can add value to an equity research team.
Remember, the key is to showcase how your skills and experiences in credit analysis can be an asset in equity analysis. It's about translating your knowledge of risk and financial assessment to the different but related world of equities.
Sources: Credit Analyst Q&A, Has anyone landed an analyst/associate role in Asset Mgmt or Equity Research with no experience? How?, Q&A: Equity Analyst & Trader (VP level) at $12+ bn Hedge Fund, Q&A: Equity Analyst & Trader (VP level) at $12+ bn Hedge Fund, Credit research to equity research
Why? Equities had a shit year, the higher interest rates make credit one of the most exciting asset classes.
Don’t be an equities in Dallas type.
What’s the comp difference between equities and credit?
Depends on the PnL. If you were in equities your pay would have been shit. If you were in credit your pay would have been way higher. Besides people in credit make way bigger bets and deploy significantly more capital than people in equities.
Makes sense… my only thing though is what about when interest rates return to normal levels?
Bro u work in credit. The 30 year is at 4.2 percent. Mr. Market says this is the new normal…
You’re the guy who whispers stuff about the “golden age of private credit” to girls over drinks aren’t you
OP here, no doubt about your comment. I agree a bit, but personally find equities more interesting
D
Will depend on how strong your firm is and what your coverage is (esoteric can be better). For example if you are at Silverpoint, should be fine to move to equities but if you are at insert random $200-500m fund no one has ever heard of as a generalist, its a bit harder.
Appreciate the response. It’s a silverpoint type of firm spin off… some top people started their own and it’s done quite well.
Then you should be okay moving over assuming its well known enough with a decent amount of AuM (ie; $1-3bn or bigger). Might make sense to target firms that play on the value side, do some credit, or come from similar backgrounds like Cadian, HG Vora, etc.
Why? Credit has a much better future than equities on the active side
OP here, very true but I personally find equities more interesting. Also higher potential upside on comp
Fair enough. I've heard of a good number of folks jumping from credit to equities (very few other way around) so should be doable
If anything, I'd be trying to make a move from equities to credit
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