Actuary switch into financial analysis?

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Hi,

I'm brand new to WallStreetOasis and newly considering a career switch into finance. If I have posted this in the wrong spot, or if it’s inappropriate to post a solicitation for career advice here, I apologize - please let me know. I would very much appreciate any comments or insight about anything below!

Where I am:

I’m currently working as an actuarial analyst at a top actuarial healthcare consulting firm. If you don’t know what an actuary is:

In brief, “an actuary is a business professional who analyzes the financial consequences of risk. Actuaries use mathematics, statistics, and financial theory to study uncertain future events, especially those of concern to insurance and pension programs.“

Where I want to be:

I have tentatively (and without a lot of knowledge of the finance world – please set me straight if need be) set my sights on becoming a buy-side financial analyst specializing in the automotive industry. I have some reasons for choosing this role and sector specifically, but I won’t go into them unless someone is interested. I’m aware of the super long hours and high stress, and I think it’s something that I can handle.

How I propose to get there:

As an actuary, I have a tough credentialing process. I’m about two years from the mid-level credential (ASA), and five years away from the highest credential (FSA). There is no specialization for ASA, but for the FSA you can specialize in something. Finance, and enterprise risk management are two of the five options. My idea is that I would reach my ASA (mid-level) certification, then get my CFA, and then start trying to get into a financial analyst role. Does this seem like a viable trajectory?

Thanks for reading!

Comments (29)

 
Apr 11, 2013 - 9:05pm

Yo buddy, I have a question for you:

If I pass two exams - P/1 and FM/2 - how difficult will it be for me to find an entry level actuarial gig?

This is for a graduating senior from a liberal arts college with a 3.4ish GPA in Math, but with no actuarial internship experience.

Thanks.

 
Apr 11, 2013 - 9:10pm

mongoose:
Yo buddy, I have a question for you:

If I pass two exams - P/1 and FM/2 - how difficult will it be for me to find an entry level actuarial gig?

This is for a graduating senior from a liberal arts college with a 3.4ish GPA in Math, but with no actuarial internship experience.

Thanks.

Yo dude. That's where I was at (no experience, two exams). With a math degree and two exams you have the necessary qualifications. The rest depends on you. Networking, knowledge, interview skills, diligence, professionalism, etc. I know a lot of people that had 1-3 exams out of college and a B.S. in actuarial science who had a lot of difficulty.

 
Apr 11, 2013 - 9:22pm

RiskIsOpportunity:
mongoose:
Yo buddy, I have a question for you:

If I pass two exams - P/1 and FM/2 - how difficult will it be for me to find an entry level actuarial gig?

This is for a graduating senior from a liberal arts college with a 3.4ish GPA in Math, but with no actuarial internship experience.

Thanks.

Yo dude. That's where I was at (no experience, two exams). With a math degree and two exams you have the necessary qualifications. The rest depends on you. Networking, knowledge, interview skills, diligence, professionalism, etc. I know a lot of people that had 1-3 exams out of college and a B.S. in actuarial science who had a lot of difficulty.

OK, so two exams and a degree are a baseline from which I can compete and the rest is up to me.

Thanks.

 
Apr 15, 2013 - 2:15pm

First off, financial analyst role is...broad. What kind of analysis? Stocks? bonds? Internal finance in a company? You say buy-side financial analyst in automotive..so maybe sellside ER? I understand that you're very early in your understanding of finance, but you really need to explore what all of these terms (and more) mean to know what you actually want to do. If you want to pick stocks in automotive, I would say your opportunities are...very limited. There are probably less than 1000 analysts in the world probably focused solely on automotive stocks, less if you only consider the buyside. On the buyside, automotive may be one of a few industries an analyst is knowledgeable on.

Your trajectory may make it difficult because you may become priced out or have to accept a pay cut. Listen, you're in a good job, you'll probably (WAG: wild ass guess) be making over $100,000 all-in after you pass the mid-level credential (ASA). On top of that you're passing 3 levels of the CFA which will take MINIMUM 1.5 years (maybe 5-10% of charterholders in my estimation do this, most take longer, average 4-5 years). So you’re talking 4 years out now.

Your best opportunity will probably be a sellside analyst in Chicago or Detroit (I dont know where they are) or maybe investment banking within the automotive industry. No one jumps straight into buyside for the most part unless you have connections I'm unaware of. Those people in finance will not be willing to pay you over $100,000 for a job analyzing autos unless you get your MBA and then go for those jobs. So you're talking about 2 years more for an MBA.

So I don’t think it’s a reasonable trajectory. If you want into finance, do more research, read more threads on WSO, go on analyst forums for CFA information, do informational interviews over maybe a 6 month period and decide if this is right for you. Networking will let you know whether you truly want to do this. If you want to do this, drop any idea of waiting 2 years to pass the mid level credential and then get a CFA charter as this is just time wasted. Jump over now, as when you are younger you cost less, and more people are willing to take a risk on you. The alternative, of course, is an MBA program in a few years, but that is going to cost you money. PM me if you have any questions.

 
Aug 26, 2015 - 9:39pm

Just don't always tell how you passed very hard math based tests while working 50 hours in a week and finance tech concepts are a joke for you. Show your soft skills; mention your hard skills casually. The interviewer will unconsciously think that you are a nerd. You can nail DCF, LBO, and accounting questions easily. Show them that you are a socialized normal guy.

for me: commercial bank 1.5 yrs -> Actuarial Analyst -> PE analyst offer
Didn't even pass any exams: CFA, actuarial exams
Spent +50 hours on my story, brain teasers, & soft skills

 
  • Anonymous Monkey's picture
  • Anonymous Monkey
  • Rank: Chimp
Sep 13, 2015 - 12:00pm

Hello, my name is samreen and I am doing bachelor in actuarial science and risk management. I'm little confuse that if I didn't clear the soa papers so where should I move on and get jobs in foreign countries (usa, Canada, Singapore). Please give me few guideline.

 
Sep 13, 2015 - 12:01pm

Swtiching to Finance as an Actuary (Originally Posted: 05/30/2014)

Hi! I'll be getting my fellowship with the Society of Actuaries soon, which is supposed to be the beginning of a great career as an actuary. However, lately I've been thinking of crossing into Finance. Dealing with hardcore nuances of insurance liabilities is getting old. I want to be learning about businesses, applying real world news/developments, be tapped into the markets, etc, instead of just playing around with my own PA.

I know one other person who has done so, and will be reaching out to them for their perspective, but I figure maybe the good people at WSO can chime in.

A little background:
-Age is mid-twenties
-Working for 4 years in a Canadian insurer
-Did a bachelor's in Actuarial Science before that
-Specialized in the Finance track for the fellowship exams
-Did CFA Level 1 on a dare so not sure about seeing it all the way through yet
-Salary+bonus will be ~100K after obtaining fellowship but cap out around 180K
-Work has a fair amount of financial modeling involved but very liability driven

General Questions:
-Does it make sense to pursue an MBA at this point? Part-time or Full-time? Target only top tier schools or is mid tier enough?
-What areas of Finance are most realistic to pursue with this background?
-How much of a pay-cut to expect?
-Stay in Canada or head to the US?
-Buy side or sell side?

For people that have made the switch:
-How different will the work be?
-How different are the hours? (Although the last few years were basically 40 hrs/week + overtime studying every night/weekend...)
-Are you enjoying the work a lot more?

This is probably the best and only time for a career change. I would like to have a good idea of the options before promotions/other life priorities begin clouding my judgement. Thanks!

 
Sep 13, 2015 - 12:06pm

Hey dreadsoap, I'm curious to see how these past 6 months have changed your perspective, if at all. I'm in a similar boat myself. I got my FSA, and am thinking of going into finance. Although I think finance is more challenging and could be potentially more rewarding, I am really weighing the change in work life balance.

Anyways, wanted to see your thoughts now. Would love to bounce ideas if you want to PM.

 
Sep 13, 2015 - 12:08pm

Actuary in Finance (Originally Posted: 06/02/2014)

Hello,

Actuary here. I have been working as an actuary for almost a full year, I finished school last year. A couple of the actuary exams deal with interest rate swaps, options, and fixed income products. These exams have gotten me very interested in finance. There are a select subset of actuaries who deal with financial products, namely those working in reinsurance and life/annuities. Anyways, I am just hoping to check out the oasis and relax at work. Cheers!

 
Sep 13, 2015 - 12:09pm

Hi
I think you could consider insurance linked securities and also working at boutique investment banks specializing in ILS

HCB:

Hello,

Actuary here. I have been working as an actuary for almost a full year, I finished school last year. A couple of the actuary exams deal with interest rate swaps, options, and fixed income products. These exams have gotten me very interested in finance. There are a select subset of actuaries who deal with financial products, namely those working in reinsurance and life/annuities. Anyways, I am just hoping to check out the oasis and relax at work. Cheers!

 
Sep 13, 2015 - 12:12pm

Transition from actuary to finance/technology (Originally Posted: 06/10/2014)

Hello everybody,
I would like to introduce myself and hopefully get to know some of you. I am a recent graduate from a target school with a degree in actuarial science and finance. I worked a summer internship at an insurance company doing financial planning and risk analysis. I did some actuarial work, which was interesting but not right for me. Now I am currently trying to transition more towards finance. I am currently teaching myself c++ through an online program, hopefully going to target some financial technology firms and some s&t departments. Some of my interviews have included a inter-dealer broker, and a software company that creates trading platforms for banks and prop firms. I had a fairly successful interview process but neither fit was quite right. I am happy to answer any questions I could.

Gerri
 
Sep 13, 2015 - 12:13pm
alpha currency trader wanna-be
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