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Comments (108)

Aug 9, 2013

Great post. SB for you

Aug 9, 2013

Mr. Wayne,

Thanks for dishing that solid industry info.

One question I have: what is the progression like throughout a sell-side ER career? How common is it to do more than 2 years as an associate, and how does that impact your career? And once promoted to analyst, what might expectations be like in terms of performance?

Thanks for your help.

    • 1
Aug 9, 2013

I just want to thank you right off the bat for coming here and dropping a few tidbits. Much appreciated.

Any tips for someone recently out of undergrad trying to break in as a fresh associate? I'm currently networking heavily but keep hearing that analysts are looking for associates with previous ER experience. Trying to create my own reports to get over this.

Aug 9, 2013

Great post.

Best Response
Aug 9, 2013

Of course, how could I forget

9. Career progression
The titles are different in each country but basically you start as an associate for the first 2-5 years of your career. This means you are helping the senior analyst by building and filling in models, gathering info from datastream, bloomberg or reuters, writing previews, talking with small clients and sales, doing some on the ground research and starting to cover your own stocks. Generally you are given a small stock to cover and go from there. It took me two years to break out of this role for me but it was quite helpful and I definitely learnt some solid fundamentals. In this stage of your career, you should try to work with a very good analyst rather than worry about the bank - but being young and at a good bank is generally appealing when you start - though not really helpful for your longer-term training. It can take five years but generally if you are bad it will take this long. BBs are a bit more structured in terms of titles but you can progress fast in a big bank too if your boss likes you.

After this you cover more stocks if you are good and if sales likes you. They are your first client - if you can convince them, you can convince clients - that is the real make or break as an analyst. When that happens you really start to progress and make a name for yourself. When this breakout happens and sometimes it can fail, you pay starts to materially increase. After this, you then start to write your own ticket. I left my first place after 3 years because I was growing as a junior and need to progress to gain more coverage. This generally happens and is par for the course.

Expectations are high as you progress. Your calls need to be good, clients need to like you and you travel a lot. Right now, I am on the road at least once a month but it is normally a short trip. I travel 25-30% of the time, and it can be tiring but I've been to 30 countries so it can be exciting in some ways. I've definitely stolen my fair share of toiletries. After 7-10 years, you write your own ticket and you are your own franchise. I can move to any bank that wants me and get paid because I have a transportable client base. Clients like my work and follow me wherever I go. Even when I went to a boutique, they followed me there. You will have developed a strong following, good historical stock calls and relationships with key people. That stuff goes a long way in choosing how much money you can make and what firm will be attracted to you. Longevity is generally to late 40's or early 50's - after a while, the work and early starts are tiring so lots of people move to the buyside. Some who have killed it leave the industry and even fewer retire - but that is possible indeed.

10. Breaking in
This is the hardest thing to do - equity research is probably one of the hardest fields in banking to get into - not because it is competitive - which it is, but mainly because there are so few seats and positions are generally filled by word of mouth. Hiring is generally poorly done and at entry levels, people are looking for some kind of internship in ER to get hired out of college. I personally hate this type of hiring and my best junior was a guy who ran his own printing company and had a killer business instinct. He offered to work for free initially to break in and eventually made his name. To break in a non-conventional way, I would try and apply through friends or at smaller companies. I started at a small company and used that experience to move to a bulge bracket firm. There are so many brokerages and you just need your foot in the door to move your way up. The first job is by far the hardest and I spent many days on this website scouring for information. CV boosters that I like are unique business experience or some evidence of lateral thinking. I don't care about the school as much as I care that you are smart and creative. I have liked people from ivy league colleges and from 3rd tier universities, but generally speaking I only end up liking about 5-10% of the applicants I see. I really appreciate some creative thinking - one guy I liked used to be an engineer and made phone chips or something like that and he was applying as a tech analyst - it was clear to me this guy was a super nerd and loved talking about semiconductors - he is now one of the rising stars his space.

If you have worked in some kind of business or done teach for america - I think that can be cool - it doesn't matter as long as you are interested and engaged in something creative and entrepreneurial. Most smart people hire this way but then you have idiot banks that hire very very conventionally. But, that is changing. A mock portfolio is always a good convo starter as well. Writing your own report would show some passion so that would be interesting for sure.

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Aug 21, 2013
Batman81:

10. Breaking in

This is the hardest thing to do - equity research is probably one of the hardest fields in banking to get into - not because it is competitive - which it is, but mainly because there are so few seats and positions are generally filled by word of mouth. Hiring is generally poorly done and at entry levels, people are looking for some kind of internship in ER to get hired out of college. I personally hate this type of hiring and my best junior was a guy who ran his own printing company and had a killer business instinct. He offered to work for free initially to break in and eventually made his name. To break in a non-conventional way, I would try and apply through friends or at smaller companies. I started at a small company and used that experience to move to a bulge bracket firm. There are so many brokerages and you just need your foot in the door to move your way up. The first job is by far the hardest and I spent many days on this website scouring for information. CV boosters that I like are unique business experience or some evidence of lateral thinking. I don't care about the school as much as I care that you are smart and creative. I have liked people from ivy league colleges and from 3rd tier universities, but generally speaking I only end up liking about 5-10% of the applicants I see. I really appreciate some creative thinking - one guy I liked used to be an engineer and made phone chips or something like that and he was applying as a tech analyst - it was clear to me this guy was a super nerd and loved talking about semiconductors - he is now one of the rising stars his space.

I am an incoming junior at a Midwest state school and I really want to do ER. However I do find this point especially troublesome because I only had one internship before my junior year and my college town isn't really a place for stock brokers. Can OP tell us more about how hard it is to break in? Like what's the specific number GS recruits for ER a year?
And isn't return offer the prime reason why companies hire interns? If you want to work at a BB how do you persuade small brokerage firms to hire you since it takes a lot of time for them to train you and you're just gonna leave for a bigger place to work afterwards?

    • 1
Aug 14, 2013

I really appreciate your insight. I've been looking for someone to address breaking in.

I'll be a rising senior at a semi-target/target and hoping to break into ER this fall, but I'm pretty worried since I haven't had any prior internship in ER. What would your advice be? Also, could I possibly send you my resume and get feedback from you?

    • 1
Aug 14, 2013
Batman81:

If you have worked in some kind of business or done teach for america - I think that can be cool - it doesn't matter as long as you are interested and engaged in something creative and entrepreneurial.

Well, teach for america is certainly going to thank you now that 1,000 hopeful ER analysts are going to apply there.

    • 1
Aug 14, 2013

This is a really great and interesting post. I enjoyed the insight.

I'll be a rising senior this fall and I was hoping to break into ER once I graduate. However, I do not have any prior internship experience in ER. What would be your best advice for me? Would it be possible to send you my resume to take a look at and give me some feedback?

Aug 14, 2013

What has inspired your move to the buy side after all this time? Could you elaborate a little on your consideration (as you put it) for moving to the buy side?

Great post btw! Thanks.

Aug 14, 2013

How long was it before you started to feel comfortable building out full models?

Aug 9, 2013

Couple of things

1. Don't call yourself a rising senior!
What is that exactly? That you are good or that someone will therefore assume you are good? One of the things you must know about banking is that we are jerky and will call you on nonsense - think of bankers as Louis CK types - very unhappy about any fluff. We deal with a lot of money, stress and shit talking CEO's - we will see through this rising senior crap. Talk to us in a non-bs manner - bankers will respect you for that.

2. Breaking in continued
I, just like all of you, was a fairly average ER candidate when I applied. Yes, I had a great degree and some cool extra curricula but that is tough to get past the obese and depressed HR lady. To get a job, you must network, try to meet recruiters for coffee, or people that work in banks. Don't ask for a job but just a chance to meet someone - that is your best way. I did not have an internship and fought my way in - I wouldn't take no for an answer and really tried anything I could. Consider smaller brokerages. There are so many that you just need a foot in the door and that is it. Don't rely on some 1st year associate at GS to 'hook you up.' They won't because they are not important yet - few people can hook you up unless they are VP or above. However, hook ups are hard because if you suck, I will get blamed for a garbage recommendation. I rarely recommend people and only when I am comfortable do I do so. Anyway, keep trying to get a foot in - small brokers, consulting, buyside. I used my experience in my family business as a transferable skill set to ER - find something in your CV that will broadly match the skill set of ER. The difference between successful ER analysts and crappy ones is tenacity - the job process is a good precursor of life on the sell-side

3. Do not apply for teach for america because I said so
Look - I like teach for america and some progressive institutions like Capital and GS value it as well. At the same time, others don't and like skills like financial modelling(taking some modelling classes is a good CV thing as well) or strong quantitative acumen. I hate these types of hires because I can teach anyone modelling or writing, but I can't teach creative thinking. For every one person that likes TFA, there is another who will quiz you on how to determine the risk free rate in a DCF. If someone asks you that question, realize that guy is a shithead, answer that question and then metaphorically punch him in the face. Most of these idiots are gone but it is possible they are still around - especially at weak franchises. Just try and find a way to make your average CV more relevant to the ER role and what we do. Personally, I love writing and appreciate numbers - i tried to make that clear in my interviews and in my CV submissions.

4. Modelling
It took me about 9 months to get pretty comfortable. I had a boss who sucked at modelling so my training wasn't great in this area but my next MD was great so I picked up a lot from him. About 4 years in, I was very very strong and now I think I am one of the best on the street. But, I had good training, a passion for numbers and I kind of like excel. M&A you will become a rockstar in a 12-18 months, sometimes quicker. the best way to get better at this is to build a model from scratch - that really accelerated my ability. Even if you don't know what you are doing - try diagnostically looking at a complete model and emulating that - that kind of training was great in my development.

5. Sell-side/buy-side

I am considering the buy-side for a couple reasons. Firstly I am bored. I have covered the same sector for close to a decade and the learning curve is limited for me at this stage. I can stick around but I feel like this would be intellectually redundant. Now, despite this - I don't really want to give up the money. You make a lot of money in sell-side ER by being specialized - and if you are good at it, it is an easy way to make a killing and not work that hard. But, it gets tiring and the 75% of the people you work with are mediocre douches - they will do anything to ruin your life because we are paid on a relative basis - as in I have to be better than everyone else. This leads to sabotage and has already happened to me a number of times in my career.

My situation is different in that my role on the buyside has a clear path to being a PM. It is exciting to be a PM - you live an easy life, get wined and dined, it is intellectually rewarding and you can make a very large sum while being home by 6. Plus, you don't have to deal with the politics and boredom that the sell-side can provide at times. It is a lifestyle and challenge thing for me - but I am reticent about a paycut - which is why I am 'considering' it rather than doing it at this stage.

Aug 14, 2013

Sorry Mr. Wayne. I meant I'll be graduating from college this fall, so wasn't sure how else to phrase it. I apologize. And thank you for the feedback.

Aug 14, 2013

Thanks for all of the advice. This will come in handy this fall while looking for a job. One last question: My school offers the training the street program in the fall and I am taking part in it. What are your opinions on that? Also, sorry two questions I guess, do you think investment banking case competitions will help me stand out over some other possible candidates?

Aug 15, 2013

All the side pointers that often aren't mentioned. Appreciate it.

Aug 15, 2013

Great write up. Thanks!

Aug 9, 2013

Training in general is a good idea - CV boosters that would stand out in my view would be the CFA level one, perhaps some financial modelling experience or training, building your own model/research report, creative business experience or fun and cool extracurricular activities. I had a cool experience working in public policy - the majority of my interviews centered on my experience there. Or a champion at something - whether it be ping-pong, debating or surfing - something that would help you stand out. I was world class at one thing in particular and interviewers asked me a lot about this. Think about one thing where you may stand out and hammer that point home on your CV. And if it is relevant to the skill set mentioned above, show how your experience can be applied to ER

Note this applies for normal ER hiring. Bernstein's associate program is different in that you are there for 3-5 years and then are expected to move on - they will help you land a job elsewhere but the senior analyst is usually a HBS grad with a consulting/industry background. Also, this does not apply for pharma/healthcare and some specialty sectors. In pharma, most of the guys are doctors and many mining analysts are former geologists. They make for great hires but the rest of the sectors generally anyone can be hired. I have seen guys with degrees in literature and guys with degrees in engineering. The gamut is wide but it takes a certain combination of skill sets to be good at your job.

Keep in mind there are really two types of analysts - the first is the bookworm nerdy pants and the second is the 'broker' broker. The first is generally pretty quiet, not amazing with clients but ok and generally has trouble being client facing all the time. I am more the latter but a secret nerd inside. I am great with clients and my strength is talking to people and really analyzing numbers. You have to be good at all these things to be successful, but there are 'types' of analysts.

Aug 17, 2013

Thank you for your post.

You commented that we should practice some modelling, is there any model in particular that you think we should create from scratch?

Aug 15, 2013

Thanks for posting. Love your commentary as well

Aug 14, 2013

How transferable are equity research skills between countries? Can you move from NYC to somewhere like Hong Kong?

Aug 16, 2013

What would be the shot of someone in Australia working in ER in London?

Aug 16, 2013

Nice posts - do you have any examples of the sabotage you mentioned? Would be interesting to hear the stories, if only for my self-indulgent purposes.

Aug 16, 2013

I am currently in the interview process for an energy analyst position and would like to thank you for this. Very rarely is such high caliber advice stated in such frank, conversational fashion. Very easily translateable to real life. There are so many gems [in the US market where the market is more alphabet soup than the UK.] in these write-ups it makes me sick. A+

    • 1
Aug 16, 2013

Just decided this is the best thread I've read on this site

Aug 16, 2013
Aug 16, 2013

Thanks for the post. One thing that I find interesting is underlying hubris in not only your post but that of other equity analysts that I've read before. Specifically, in regards to you saying that you don't respect 90% of other analysts. I've heard others say the same thing. Can you provide greater detail into this. Assuming these are all competitive jobs to get and it doesn't really seem like anyone respects anyone there must be some disconnect. Thoughts on this?

Aug 21, 2013

I found that interesting as well, can OP give us more information on this?

Aug 16, 2013

Thank you for this great post. I have been reading Best Practice for Equity Research Analysts by James J. Valentine, and one of the things he suggested is to take time management training programs (e.g. GTD / FranklinCovey). I was just curious about your opinion on this?
Also, may I ask if you would always prefer large bulge bracket banks over smaller ones to work as an equity research analyst?
Again, thanks for the post.

Aug 16, 2013

Excellent post, very insightful and organized. You said, "I did not have an internship, but fought my way in." Could you please elaborate on how you "fought" your way in? Cold-calling?

The difference between successful people and others is largely a habit - a controlled habit of doing every task better, faster and more efficiently.

Aug 16, 2013

great post thanks!
looking at your post, you have some solid experience here and there.
which place do you like best? nyc - london or paris?

i am located in one of the three described and i am really interested in working in the others as well.

Aug 16, 2013

Thanks for the excellent post!

I currently work for my family's business and am hoping to break into equity research in the future. My plan is to pass the first two levels of the CFA and combine that with an MBA (and lots of networking) to give myself the best chance possible at a FT position in ER.

Given how few openings there are in ER, would it make more sense to try and specialize in one sector and learn everything about it, or learn about as many sectors as possible (since I'm assuming that when people are hired for ER positions they are hiring for a specific sector/industry)?

Lastly, do you have any advice on learning how to properly structure a research report?

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Aug 14, 2013

One last question from me which may be hard to answer:

Do you think it will be harder now to switch to the buy side since you have so much experience? Performance aside, is it typically harder to switch from research (specifically) to buyside if you have more experience? (this seems to be conventional knowledge in regards to bankers). I have heard that earlier is better, since you are still perceived as "cheap" labor.

From what I've largely seen, seems like the easiest ways to switch are if A) you are very senior and have the connections and general knowledge to be attractive (i.e. held in high regards by your peers in the industry) B) if you are very junior and can be worked to the bone while simultaneously contributing to the firm and learning skills that will be value adding in the future.

Aug 16, 2013

Excellent post! Thank you

Aug 16, 2013

Thanks for the incredibly insightful post. As you know, posts like this are always extremely helpful. I have a similar question to Aedius's.

After reading your anecdote about the nerd with a passion for technology, I figured this would apply. I've always been interested in Food/Beverage industry and want to focus on getting an ER position researching that sector. My mother works as a researcher in the Food/Bev sector for a market research firm so I have pretty good access to data and trends in the space. What is your opinion on focusing on one specific sector when looking for an entry level ER position?

Aug 16, 2013
Batman81:

Couple of things

1. Don't call yourself a rising senior!

What is that exactly? That you are good or that someone will therefore assume you are good? One of the things you must know about banking is that we are jerky and will call you on nonsense - think of bankers as Louis CK types - very unhappy about any fluff. We deal with a lot of money, stress and shit talking CEO's - we will see through this rising senior crap. Talk to us in a non-bs manner - bankers will respect you for that.

2. Breaking in continued

I, just like all of you, was a fairly average ER candidate when I applied. Yes, I had a great degree and some cool extra curricula but that is tough to get past the obese and depressed HR lady. To get a job, you must network, try to meet recruiters for coffee, or people that work in banks. Don't ask for a job but just a chance to meet someone - that is your best way. I did not have an internship and fought my way in - I wouldn't take no for an answer and really tried anything I could. Consider smaller brokerages. There are so many that you just need a foot in the door and that is it. Don't rely on some 1st year associate at GS to 'hook you up.' They won't because they are not important yet - few people can hook you up unless they are VP or above. However, hook ups are hard because if you suck, I will get blamed for a garbage recommendation. I rarely recommend people and only when I am comfortable do I do so. Anyway, keep trying to get a foot in - small brokers, consulting, buyside. I used my experience in my family business as a transferable skill set to ER - find something in your CV that will broadly match the skill set of ER. The difference between successful ER analysts and crappy ones is tenacity - the job process is a good precursor of life on the sell-side

3. Do not apply for teach for america because I said so

Look - I like teach for america and some progressive institutions like Capital and GS value it as well. At the same time, others don't and like skills like financial modelling(taking some modelling classes is a good CV thing as well) or strong quantitative acumen. I hate these types of hires because I can teach anyone modelling or writing, but I can't teach creative thinking. For every one person that likes TFA, there is another who will quiz you on how to determine the risk free rate in a DCF. If someone asks you that question, realize that guy is a shithead, answer that question and then metaphorically punch him in the face. Most of these idiots are gone but it is possible they are still around - especially at weak franchises. Just try and find a way to make your average CV more relevant to the ER role and what we do. Personally, I love writing and appreciate numbers - i tried to make that clear in my interviews and in my CV submissions.

4. Modelling

It took me about 9 months to get pretty comfortable. I had a boss who sucked at modelling so my training wasn't great in this area but my next MD was great so I picked up a lot from him. About 4 years in, I was very very strong and now I think I am one of the best on the street. But, I had good training, a passion for numbers and I kind of like excel. M&A you will become a rockstar in a 12-18 months, sometimes quicker. the best way to get better at this is to build a model from scratch - that really accelerated my ability. Even if you don't know what you are doing - try diagnostically looking at a complete model and emulating that - that kind of training was great in my development.

5. Sell-side/buy-side

I am considering the buy-side for a couple reasons. Firstly I am bored. I have covered the same sector for close to a decade and the learning curve is limited for me at this stage. I can stick around but I feel like this would be intellectually redundant. Now, despite this - I don't really want to give up the money. You make a lot of money in sell-side ER by being specialized - and if you are good at it, it is an easy way to make a killing and not work that hard. But, it gets tiring and the 75% of the people you work with are mediocre douches - they will do anything to ruin your life because we are paid on a relative basis - as in I have to be better than everyone else. This leads to sabotage and has already happened to me a number of times in my career.

My situation is different in that my role on the buyside has a clear path to being a PM. It is exciting to be a PM - you live an easy life, get wined and dined, it is intellectually rewarding and you can make a very large sum while being home by 6. Plus, you don't have to deal with the politics and boredom that the sell-side can provide at times. It is a lifestyle and challenge thing for me - but I am reticent about a paycut - which is why I am 'considering' it rather than doing it at this stage.

Nice post...thank you. But, re: #1 are you serious dude?? It is summer time-he is a rising senior because he is about to be a senior in college.

Aug 16, 2013

Thanks man, great post!

I am starting a top-15 MBA program this fall and am debating between going into ER or IB. My prior work experience consists of being in software at a MM bank and being a research associate in biotech (I want to focus on either the life sciences or tech sectors). I have a lot of contacts in both IB and ER at my old firm but I'll be doing formal recruiting for the BB firms this fall as well. Any advice on how to choose between the two? I love research and writing however I'd prefer the seemingly more varied exit opps out of IB. Also, have you ever heard of anyone switching from IB into ER? From what I understand, the actual work performed is completely different but someone once mentioned to me that if I couldn't get into ER straight out of school to try for IB and then switch. Thoughts?

Aug 15, 2013

Not to steal ops thunder here but when I worked at networked at BB there were people that make the switch (both). The IB guys wanted better hours/quality of life, the research guys realized it wasn't the right fit and wanted to try banking.

Aug 16, 2013

This is great information!

This being my first post on this site, I finally decided to ask and get some advice after seeing your post. I have always been interested in finance but wasn't 100% sure as to what I would like to be doing. After being out of school and working in a family business, and dealing with some issues of family and health, I believe I narrowed my possible career interest to something I can actually enjoy and not have to work in a repetitive job duty type of role like there usually is in the Accounting field.

Trading appealed to me because I was always fascinated with the stock market, economies, and related issues and events. Other than that, after seeing this post and some previous encounters with blogs and posts on this site, ER is another area of interest. I graduated with a BBA in Accounting and Finance in 2007 from a local public university in Texas, and worked in retail sales while going to school.

My issue/dilemma/whatever you can call it is that I didn't take the traditional route of internship, then working in industry afterwards etc etc. For the past year I have worked in customer service at a local company. So not having any experience in finance (I do have some in Accounting) am I just on a wishful thinking track or is there really any hope for me if I want to get into ER, I'm thinking on the buy side if possible ? I say all this also because at this because at this point I am 33. So I'm not sure exactly what the cards will hold.

Well, I appreciate any advice/tips you might have. Thanks!

Edit: Forgot to add, I have all the required hours out of the way to sit for the CPA exam. I never got myself to study for that exam for 'some' reason :/ .

Aug 16, 2013

What is your opinion on choice of industry coverage? My industry of interest is covering financials. Right now i have an opportunity to cover mortgage reits or consumer staples. I heard it's better to cover consumer or tech as there's more opportunities and you get pigeoned holed if you cover financials. What do you guys think? But being a specialist you are valued for knowing an esoteric industry nobody else knows?? How much does it matter that you work for an ii ranked analyst? Thanks!! =)

Aug 16, 2013

Nice write up and thank you for sharing your story.

Can you please elaborate on the back stabbing and general douchbaggery that you mentioned?

Was the back stabbing benign, like stealing your stapler, or more nefarious like sneaking on to your computer when you're in the head to hard code a number in your model or blast a racist email to all of your clients?

How did you handle it? What advice do you have for others who have found themselves in similar situations?

Thanks

Aug 16, 2013

Thank you for your post.

I recently switched over to a new firm after having started in ER two years ago. While it was the right decision to leave my previous company, I fully regret having accepted the current position. The quality of our reports and models are lower than I expected, I'm given very limited responsibility and rarely speak with IR (let alone clients), and fit is proving to be problematic. I'm losing my passion for ER.

Any advice on whether I should look for other opportunities to better develop, or if the stigma of trying to or having switched jobs within three months is far worse than the potential benefits?

Thanks again.

Aug 18, 2013

although I haven't been around as long as batman, i can attest to his call about 'tenacity'. I am a junior and its taken me 2 years of the shittest work on earth before I jumped over. I pretty much won over the MD of my region just because I wouldn't give up and leave him alone.

Aug 9, 2013

Ok, lots to get through here - lets see what happens.

1. Bulge Bracket vs. Boutique
Both have advantages in my view - it really can come down to a lifestyle/status choice in some sense. At the BB, I worked more weekends and had more pressure, but along with that came more money, more exit options and it was great to drunkenly hand out business cards to the occasional floozy with a BB name on it. If evolutionary fecundity is your game, a BB and its name recognition can be an interesting conduit - that is when you're not chained to your desk, exhausted, or comatose from binge drinking or other harmful substances. A BB can also stifle your creativity and you are generally a cog in the wheel. They will make sure they get every extra penny they give to you. And because you are a number you are more likely to be fired for any odd reason unless you are an absolute rockstar. I would say it is something worth experiencing and I have not ruled out going back if the situation is right and the head of research is not a jerk. In equity research though, you have a fairly free market for talent in that even at a boutique if you are good you will be paid well and you generally have better hours, greater intellectual freedom, better job security and the chance to partake in equity in the business. This can provide a lot of upside in the long-run but the pay is generally 25-30% better at a BB. Initially, I would suggest trying to work with the best analyst you can find - training is much more important than the brand name if you want a long-term career in ER. I know many of my BB colleagues who toiled away for years as a gimp to the senior analyst, not really learning anything or growing and effectively becoming replaceable. My grad experience at a boutique was excellent because the people were more willing to help me and I worked with a great set of senior guys. This never would have happened had I started at the bulge bracket and I don't think I would have been developed nearly as well. I moved on from the BB because I had an opportunity to head my own team which has been very rewarding but nonetheless, there are definite advantages to working at a BB at some point in your career, if only for the intellectual satisfaction of knowing you can compete with the 'best.' I have seen a lot more divorces at big banks than at boutiques - take that for what you will.

2. Arrogance of sell-side analysts
Equity research analysts are pretty arrogant when it comes to their work. This is because there is a natural arrogance to our job. When I put a buy on a stock, I am saying the entire market is wrong and they are missing something. That leads to natural arrogance. This can develop in one of two ways. You can become stubborn or a student of the game and constantly refine your approach while sticking to your core principles. I try to steer towards the latter and I am constantly assessing my analytical style. But, I have a healthy ego that I keep in check through normal activities and reality checks that helps it from going out of control. This is important when I discuss the right attitude for trying to get a job in ER and not overselling yourself while still strongly reflecting your skill set.

3. Backstabbing
Backstabbing is very very common at bulge bracket banks and boutiques. Banks are full of horrible people who are extremely arrogant and can be full of shit. Remember, hiring is done poorly and you can survive by stabbing others or having a couple of good clients. Generally, if you make it in and are good, someone will eventually try to ruin your life. This might be a senior analyst or a VP above you. Because it is so easy to get fired, a bank will always jump at the chance to promote someone who is young, hungry and talented. As a result, if you start killing it, you will be a rising star but also likely to replace/usurp someone at a higher level. This is why Bernstein does not hire associates to become senior guys - they remove the natural tension that can evolve in moving up the ranks in equity research. It has happened to pretty much every successful analyst I know. Actions can involve senior analysts trying to 'proof-wrong' your reports by suggesting taking out good parts and keeping in bad parts. It can involve making sure you don't have resources, support, a smaller budget and trying to make your life a living hell so you will quit/leave and they can continue on. I have heard some horror stories from my competitors but it generally has happened to everyone I know who is successful in ER.

Einstein once said that 'Great spirits have always encountered violent opposition from mediocre minds.' This is the case in equity research and this is why it can be a miserable and debilitating experience as you climb the ranks. This also explains why people move around from company to company.

4. The right type of attitude when breaking in
It is important to really try and develop a passion for equity research and have the right attitude when trying to get into this field. I have had thousands of applicants tell me 'I have XYZ degree and I plan on doing the CFA level one/MBA and I have a real passion for working at BB research house.' Or, I get another applicant who oversells his/her qualifications and tells me he is the youngest MBA in his class. In the first case, it is clear the status of an ER job is more important than the job itself . 90% of applicants want ER because of the money/status - and usually flake out because they don't have the skill set or ability to handle the stress/grueling hours. I know this is good money but you really need to think about whether you would like the job every day. Trust me, the money is not the reason I am able to get out of bed at the crack of dawn on a Friday in the dead of August. You really have to like the work and what it entails to even survive. This is why only 20% of BB grads make it to any senior level in ER.

In the second case, I always get candidates who oversell their qualifications . This happens more with MBAs but qualifications are less relevant than the skill-set - you need to project the right skill-set, not come across as smarmy with a shit-eating grin but also really think about your positive qualities and how you can contribute. Your educational background will be of nary concern when you have lost your first client millions of dollars. Anyway, this doesn't mean I am against great degrees - I am against using that as a crutch to assume this is the path to success in ER. The books mentioned above are good and there are others, but also think about what you are good at and like to do, rather than the purely educational qualifications that would normally make you stand out - this mind-set will help you in the interview process. Use your education and background as a framework for finding relate-able skills to ER - rather than plopping them down on paper and assuming that is good enough to get you in.

5.Buy-side entry
If you want to be a hedge fund or asset manager, I would start at the buy-side first - generally it is easier as a grad. This is a skill-set thing as well - but definitely find an asset manager if you want to break into a hedge fund after a couple of years.

6. Sectors to pick
Always pick the sector you enjoy the most as long as the market cap is decent. If you enjoy the sector, you will always make more money over the long-term - financials are a decent sector and if you like the work then pick that one - you get pigeon holed in all forms of equity research so don't worry about that. Where you will be good matters way more.

7. What are your chances?
To those with specific questions, I will try to answer them here. To the 33 year old, you will have a lot of explaining to do on your age and family related circumstances to convince a recruiter that you are better than any 22-25 year old fresh grad. Not saying it is impossible, but you will have to fight and need a clear vision as to why you want to do the role, especially after so much time has elapsed since you graduated. To the top-15 mba - try and focus on where you want to be placed - having clarity on what you want to do and your interest will help you.To the guy with the mom in food/bev - remember, this doesn't mean you have passion in the field - showing how you have similar interests is crucial, otherwise it could be considered hollow and tertiary.

I haven't answered everything here and I won't have much time from now on in to give detailed responses but I will see what I can do. Best of luck and sorry if I have not addressed your questions specifically!

Aug 21, 2013

Dear Batman81

Thank you in advance for ANY tips, advice, or whatever....

I recently finished swiss high School (top 10% of my region) and now I am beginning a Bachelor in Banking&Finance (expecting to graduate in 2016). I speak German (native), English, Spanish and French (all of these fluently).

My target is to break into (S&T or) ER. To reach this goal. I am conscious that I must have completed at least one or two internships in a related field....

I dont have any experince in finance expect that I am trading since a year and doing market research for it...

Here in Switzerland it is impossible to get an internship as a first year student even in other fields in finance (also in Back Office). As I have read in various Posts here at WSO, it seems to be extremely normal that you ve done internships during your first two years of your undergraduate degree....so I assume it may be quite easier to get internsips in the US compared to Switzerland or Mainland Europe....

That is why I am pursuing to find a summer internship for 2014 in the U.S, hoping to learn a lot and getting an experience (even if it would be a bad one). I am eager to intern in a random field of finance, as long as it maximizes my chances getting into (S&T or) ER after graduation...I would also be interning for free...

I dont have any contacts in the States, where should I start? Should I cold-emailing random dudes working in Finance/ER? Or may it be a good idea to fly to the U.S. for a few days, just for Networking purposes?

Would it be considered rather negative or positive if I would cold-email a random dude working in (S&T/)ER in the U.S?

And where should I apply? Which places are the most receptive to a swiss guy, willing to breaking into Finance? Small boutiques? Or even local BB places like in Texas?

Which (S&T and) ER-related fields are a good starting point for a career?

==> Do I have a chance as a swiss guy (due to the negative Image of my country in the U.S) getting a summer internship in 2014 (I would even work for 0.0$, just for gaining experience, knowledge and a name on my CV)?

==> When should I start networking? In September, October? Should I even do a trip to the U.S. to get in touch with guys working in those fields?

==> Do you consider me naive because I am willing to intern in the U.S?

I would be extremely grateful for any responses or advices!!!

Greetings from the swiss alps.

have a good day,

SwissChocolate

Aug 16, 2013
Batman81:

Ok, lots to get through here - lets see what happens.

1. Bulge Bracket vs. Boutique

..

Thank you so much for the explanation. It is definitely interesting to know that talent shines, even in boutique. Just as a quick follow-up: could you talk a bit about heading your own research team? Anything could be helpful and I am particularly interested in what kinds of tasks you would choose to delegate to more junior member and what you would still do yourself.

Thank you in advance.

Aug 16, 2013
Batman81:

10. Breaking in

This is the hardest thing to do - equity research is probably one of the hardest fields in banking to get into - not because it is competitive - which it is, but mainly because there are so few seats and positions are generally filled by word of mouth.

Batman81:

1. Bulge Bracket vs. Boutique

Initially, I would suggest trying to work with the best analyst you can find - training is much more important than the brand name if you want a long-term career in ER.

Also, you mentioned that ER usually has few seats available and recruiting is usually done badly. I would then assume that most of the times it's really about taking what's available at the moment, and hoping that the senior analyst is good for my own long term growth. May I ask for your advice on this? (or just refer back to the "breaking in" section?). Thank you.

Jan 3, 2014
Batman81:

there are definite advantages to working at a BB at some point in your career, if only for the intellectual satisfaction of knowing you can compete with the 'best.'

Batman - what makes you say this? I would've thought the "best" people would have moved on the buy-side and would be running money i.e. no longer at the BB. You seem to be saying the opposite...

(In my experience I haven't met a lot of creative thinkers on the sell-side relative to the buy-side, so I'm really not sure on what metric you are saying that people at BB's are the "best".)

Aug 9, 2013
arrhythmiatic:
Batman81:

there are definite advantages to working at a BB at some point in your career, if only for the intellectual satisfaction of knowing you can compete with the 'best.'

Batman - what makes you say this? I would've thought the "best" people would have moved on the buy-side and would be running money i.e. no longer at the BB. You seem to be saying the opposite...

(In my experience I haven't met a lot of creative thinkers on the sell-side relative to the buy-side, so I'm really not sure on what metric you are saying that people at BB's are the "best".)

You're broadly right - most of the smarter people move to the buyside from sell-side. I guess my comment is related to moving from boutique to a BB - to be honest, BB people are not that much smarter anyway - but it's nice to know you can battle against these guys and win. I did the BB thing for a while - and at the end of the day - being at JP Sachs doesn't make you a better stock picker, its your intellect and knowing when to go up when everyone tells you to go down.

But, Analyst money on the buyside is lower - if you are a PM, then solid you should make serious coin regardless - but the key is that is a MUCH better job - you are able to pick investments, in size and time things. Plus you can go home early. And very little politicking.

Aug 21, 2013

Thanks for all the informative post. I'm hoping to get into ER, PE and ultimately VC and will be shortly sending a PM your way. Would be great if you could take some time to give a read - thanks!

Aug 9, 2013

Swiss guy.
1. Please be more succinct - rambling on is a bad quality.
2. You are being naive - why the eff would a US company hire a Swiss high school kid who speaks European languages?
3. I'll use you as an example - this is where it important to read what I wrote. You need to, as I said, focus on your skills and why they would be relevant to a bank - speaking those languages is relevant in Europe - try there to start.
4. Please do not turn this into a 'will I get in?' thread - think about what I have written, drink some booze and live life a little. You are in your first year of university - getting in is very hard but try to think about your skills and how they translate to a job rather than arbitrarily applying to GS trading in New York. Consider the role more and what you can bring to the table - it will help you in the long-run.

Aug 14, 2013

Hey Batman81. Thanks for the great thread and replies. One of the best I've read on WSO and you seem like one of the most down to earth people on this sight.

If you aren't tired of answering questions yet (I would be), can you divulge a little more on your background (without giving away too much of course)?

Aug 21, 2013

This post is Gold. Thank you.
Maybe FX for the Swiss Guy.

Aug 21, 2013

Great post, thanks for doing this.

I've decided to switch from AM marketing to ER, and I'm wondering if it's more straightforward to get the CFA or an MBA. Also: how useful is a masters in finance for this? The common wisdom on this site is that I should just network and start writing research of my own, but that seems like a crapshoot.

What do you think?

May 20, 2014
UFOinsider:

Great post, thanks for doing this.

I've decided to switch from AM marketing to ER, and I'm wondering if it's more straightforward to get the CFA or an MBA. Also: how useful is a masters in finance for this? The common wisdom on this site is that I should just network and start writing research of my own, but that seems like a crapshoot.

What do you think?

Did batman ever answer your question? I am wondering the same thing.

Aug 9, 2013
LeverageMill:

UFOinsider:
Great post, thanks for doing this.
I've decided to switch from AM marketing to ER, and I'm wondering if it's more straightforward to get the CFA or an MBA. Also: how useful is a masters in finance for this? The common wisdom on this site is that I should just network and start writing research of my own, but that seems like a crapshoot.
What do you think?

Did batman ever answer your question? I am wondering the same thing.

MBA, CFA and MFIN are all great - CFA is the best though I would say. at least level one but it is hard during work.

Aug 21, 2013

k

Aug 22, 2013

Dear Batman81,

Thanks for the brilliant post. I am in my final year in Economics and recently interned as an Equity Analyst covering Financial Sector in a small independent research firm. I enjoyed covering Financials Sector, it's vibrant and always changing.

You mention it's crucial to cover a sector with (i) Decent Mkt Cap (ii) Passion.

Here's my question,

1) It is more important to settle for the BB/MM regardless of sector or the sector you're keen in even if it's independent research house?

Aug 22, 2013

Great post. Hope you can entertain some perhaps more abstract questions.

1. On ideas: is it better to be way outside consensus or just on the edges, or does it depend on the situation?

2. Revenue generation: How much time do you (or the people below you) spend reacting to buy side requests, versus generating new ideas for the sales guys to work with? I was surprised to learn from a contact that the former is much more common than I expected. Maybe it depends on the firm.

3. What's your opinion on the issue of analysts being hesitant to recommend "sells"? Analysts are perma-bulls it seems, in order to keep banking and the industry C-suite happy, do you have any solution for this or do you just suck it up and try to cover good companies from the get-go?

4. Do you spend much time writing macro-type research, versus company-specific?

Aug 9, 2013
klf1983:

Great post. Hope you can entertain some perhaps more abstract questions.

1. On ideas: is it better to be way outside consensus or just on the edges, or does it depend on the situation?

2. Revenue generation: How much time do you (or the people below you) spend reacting to buy side requests, versus generating new ideas for the sales guys to work with? I was surprised to learn from a contact that the former is much more common than I expected. Maybe it depends on the firm.

3. What's your opinion on the issue of analysts being hesitant to recommend "sells"? Analysts are perma-bulls it seems, in order to keep banking and the industry C-suite happy, do you have any solution for this or do you just suck it up and try to cover good companies from the get-go?

4. Do you spend much time writing macro-type research, versus company-specific?

Sorry, been busy.

1. Depends on situation - you'll find a style that suits you - I am generally contrarian, and probably a hard one. Not to be cool but that is what works for me. If everyone agrees with me, I feel uncomfortable. I use that in my style. Some people play momentum etc.

2. Split between sales and buyside. But I can spend all my time with clients if I want. Sales are conduits to PMs so that helps.

3. hate analysts without sells - this is the crap in the US rather than Europe. It is a shame this persists, but no one has guts to piss off big companies. I like doing it but companies cut you off instantly when you do it so it is hard.

Dec 17, 2013

Thanks a lot for this, I have a couple informal questions here that I have been wondering and can't really ask people in real life hah

You mentioned the number of layoff rounds that occurred, what do you think prevented you from being laid off all those times? Sort of on that note, how do you handle your office politics is it really that bad?

Also I am trying to get a better idea of the comp, my understanding here is that you are seven years in (did you come straight from undergrad?) and making mid six figures which is very impressive. Do you see that rising more and if so where is the ceiling? How variable is comp throughout your peers?

Aug 26, 2013

Great Post.

Dec 17, 2013

Thanks for the post.

Jan 3, 2014

Great post! Thank you!

Jan 3, 2014

Don't want to take the thread of the conversation away from what is some great advice on ER, but the idea of relating your strengths to the role you want is applicable to any job application. To me the best piece of advice offered here is the "think what you can bring to the table".

If you've had internships etc in other areas of finance, great, but that won't convince your interviewer that you have the skills or the personality for the role unless you make it plain obvious.

Aug 9, 2013
tgclewis:

Don't want to take the thread of the conversation away from what is some great advice on ER, but the idea of relating your strengths to the role you want is applicable to any job application. To me the best piece of advice offered here is the "think what you can bring to the table".

If you've had internships etc in other areas of finance, great, but that won't convince your interviewer that you have the skills or the personality for the role unless you make it plain obvious.

Great point - I agree - crucial when trying to break in.

Jan 4, 2014

Holy crap, this is a fantastic thread. I remember reading it in full when it was first posted, but it's still extremely informative and useful on reading it the second time.

Thanks, @"Batman81"! On a side note, thanks to @wallstreetoasis.com as well for re-posting the best threads of the year. Very useful.

Jan 4, 2014

This is by far the best post I've read on WSO; it's well-written, informative and down-to-earth.

Thanks, Batman!

I'm a Chemistry grad, I've interned at a pharma company (think Pfizer, AZ, GSK), and I'm currently working in finance as a consultant. I'm interested in ER, specifically pharma stocks, and I've heard that covering healthcare can be significantly different to other sectors. Is there any truth to this?

Aug 9, 2013
NorthernMonkey:

This is by far the best post I've read on WSO; it's well-written, informative and down-to-earth.

Thanks, Batman!

I'm a Chemistry grad, I've interned at a pharma company (think Pfizer, AZ, GSK), and I'm currently working in finance as a consultant. I'm interested in ER, specifically pharma stocks, and I've heard that covering healthcare can be significantly different to other sectors. Is there any truth to this?

Yes, pharma is a different animal - the sector is full of ex-doctors/phd's who are now picking stocks and analyzing drugs. Big sector, well paid but has that slight barrier to entry. Pharma is a bit binary - if a drug is approved, the stock rips and if it doesn't, the stock can tank - it makes forecasting difficult. Good sector to be in if you like it - and it pays the best b/c it is huge. I find it a snore fest so not really my thing!

Jan 4, 2014
Batman81:

Pay is about 30% lower on the buyside as an asset manager but the hours are much better and investing can be pretty fun on its own. Hedge fund money is better but much more volatile and risky. Hedge funds have been found out to some degree and unless you are at an elite fund, the risk adjusted pay in my view is not generally worth it.

Can you elaborate on this? Is this true for mega funds like Fidelity/Wellington/T Rowe or are you talking about smaller managers that might have like $5-10B in total AUM?

Jan 27, 2014

Fidelity/T.Rowe/Capital/Wellington are amazing places to be at BUT there are very few spots available as people tend to stick around literally for decades and turnover is 1-2% a year - the comp declines pretty fast as you go down the prestige ladder. I also know people working at "super elite" hedge fund shops who haven't gotten paid a bonus in years - it is about eat what you kill and an average hedge fund performance sucked for the past 5 years - which makes Fidelity and such an even harder job to get

Jan 7, 2014

Thanks! This is great

Jan 7, 2014

Congratulations Batman81 for your talent and all the advice given in many posts.
I'm a physician in Italy currently in clinical pharmacology fellowship. This is 5 years long path very similar to the 3 years residency + x years fellowship for medical doctor in US.
I chose clinical pharmacology because i love research and development of new product, in particular i really like pharma and biotech world since i've started medical studies.
Now i'm 26 and i'll finish the fellowship on 31 with good experience of clinical drug discovery (drug clinical trials followed as an academic, some laboratory experience with scientific publications and simple report for regulatory agency like FDA).
Usually after this fellowship there are these exit opportunities:
1) Continue academic career as a pharmacologist (directly encouraged by my professor)
2) Pharma/Biotech medical affairs or other roles
3) Work in a regulatory agency

Nobody in my group consider other exit opportunities like consulting, IB (ER) and PE (VC are currently very few in Italy...) strictly connected to healthcare, since in Italy are not common for an MD (medical doctor) .

- Do you think my profile is good for ER in pharma/biotech?
- Which route would you recommend to get in touch with IB or buy side and start to learn all the financial skills required?
- We work about 60-80h a week so there is little time to prepare for CFA, but I have considered the possibility to study for the step 1 this year. It's a must to take this exam for a person with MD background?

We have 18 months during fellowship for an experience abroad and i will probably choose US (new york, boston or silicon valley) or London: the places where i'd like to live my future career.
- Do you think is it possible to have an internship in IB even if i'm an MD (no salary required obviously!) or it's better to continue my path in pharma/biotech industries or academic research till the end of the fellowship and change to ER only when specialized?

I know it's not an easy step but as an MD always involved in drug discovery, i think it's not impossible to make this change.
Many thanks for your patience!
Any advice is welcome...

Jan 8, 2014

Fabulous post

Jan 24, 2014

Batman, to be honest you seem like a pretty cool guy who live the life. Good for you!

Anyway, sidetrack a bit here. I've seen some seniors here chipped in their favourite 'investing' or finance related books which I find very useful (I read Fooling Some of The People based on some solid recommendations here).

Could you give some reading recommendations for aspiring ER monkeys like me?

Cheers.

Jan 8, 2014
beautifool:

Batman, to be honest you seem like a pretty cool guy who live the life. Good for you!

Anyway, sidetrack a bit here. I've seen some seniors here chipped in their favourite 'investing' or finance related books which I find very useful (I read Fooling Some of The People based on some solid recommendations here).

Could you give some reading recommendations for aspiring ER monkeys like me?

Cheers.

Would appreciate if batman or others with experience could recommend books..

Feb 8, 2014

Hey Batman, thanks for great post.

I would really like your advise on my current situation as I am working with mid market investment bank in India and got referred and now have an offer from BB in ER covering Indian companies. The catch is pay-role won't be of BB but third party Indian entity (common in India) as BB doesn't have the head count to hire. So, pay won't match BB and reports will not have my name. I have been hinted by management that once they have the headcount then they can consider me absorbing in BBs pay-role and it may take years. Do you think I should take up this role?? Also I am 30 and have around 5 years of IB experience. Does it make sense to make a career move at this stage?

Thanks

Mar 26, 2014

Great post. I am currently in the interview process for a ER summer internship with a buy-side boutique. I know the typical move to PM is by working your way up as a ER analyst, but I was wondering if you could tell me how hard it is to become a PM from equity sales? Do people with equity sales backgrounds experience more resistance when trying to break into a PM role? Thanks in advance.

Mar 27, 2014

If you start in ER out of undergrad and want to go to a HF, how long should you spend at the ER firm? 1 year? 2 years? 3 years ?

Apr 23, 2014

My husband has run his own tech business for the past 20yrs and now would like to get into ER in the tech industry. However, people have told him he is too old. Do you agree with that?

Apr 23, 2014

My husband has run his own tech business for the past 20 yrs. He now wants to get into ER in the tech industry. People have told him he is too old to start in ER. Do you think this is true?

Apr 23, 2014
ktiva:

My husband has run his own tech business for the past 20 yrs. He now wants to get into ER in the tech industry. People have told him he is too old to start in ER. Do you think this is true?

Not at all, most firms will actually appreciate his industry background (assuming he would want to cover tech companies).

Apr 23, 2014

Thanks for sharing

Apr 26, 2014

Great thread, I wanted to ask for insight on the kind of interview questions you would ask someone who is lateraling from banking. I think as far as "why research" I've got it down pat: been investing on my own for many years, enjoy the research and writing in banking but want to do it from a public markets' perspective, would love to get published etc.
I'm more concerned about what people will ask about my banking experience. I interviewed for a PE, who asked about nitty gritty deal responsibilities and I interviewed for hedge funds, who don't seem to care at all and go straight to my stock picks. Trying to get a better sense as to where research falls on the spectrum: will it be more focused on the broader sectors I've been covering?

Apr 23, 2014
dontgotolawschool:

Great thread, I wanted to ask for insight on the kind of interview questions you would ask someone who is lateraling from banking. I think as far as "why research" I've got it down pat: been investing on my own for many years, enjoy the research and writing in banking but want to do it from a public markets' perspective, would love to get published etc.

I'm more concerned about what people will ask about my banking experience. I interviewed for a PE, who asked about nitty gritty deal responsibilities and I interviewed for hedge funds, who don't seem to care at all and go straight to my stock picks. Trying to get a better sense as to where research falls on the spectrum: will it be more focused on the broader sectors I've been covering?

Slightly off-topic, but always have the SS vs. BS points down as the SS wants to see why you want to be with them as opposed to one of their clients.

May 21, 2014

@"Batman81" This thread and all your commentary are invaluable. And inspiring for someone with an entrepreneurial background. Thank you.

May 21, 2014

Just wanted to say thank you -- this thread has been extremely insightful.

4th year BBA | Simon Fraser University

Aug 9, 2013

Update - so I guess it has been a year since I last wrote on this board and I am bored so I thought I would share some updates with you ER hopeful.

  1. I am still doing sell-side work - why? I still feel mildly challenged by it and the money is getting quite good and I am lazy. I feel like there is little left to learn now but I kind of want to cash in some checks first before I start to challenge myself again. I also kind of show up when I want and sometimes I am gone by 5. I work really 8-5 to be honest but no one cares because I do well with clients. I did well in two of extel/II/Starmine (surveys for popularity/stock-picking) and therefore I have a bit of a free pass. It probably won't last but I am riding it out and showing up to work in loafers and khakis. It is a great perk but took a while to get over that hump.
  2. Money gets better as you get established but doesn't make you happy. I am director/ED level, one below MD and money is quite solid. Mid six figures is what happens, sometimes a bit higher. Honestly, I think I should get more but I had a good year and got paid similar to some lower MDs which was awesome. It hasn't made me happy as such. Money is great, but then you want more and life gets a little more extravagant. I am content, but make no mistake it has given me options beyond my wildest dreams and is the envy of many of my friends. It gives you a chance for stuff you might want in the future - like a nice house, private school if you have kids or bail money if you have kids. But you could be fired at anytime so there's that. And the stress really sucks.
  3. I PA trade a lot more - I find myself trading a lot more. This is great practice and you get to splash around. This keeps me motivated at work. I have been covering the same 8-10 stocks for close to a decade so that can get dull. PA trading ends up being the most interesting part of my day - I am all up in currency and muck around in stock all day. That is probably the key to being successful, not thinking of work as work. I think I have survived in ER because it is fun- I like being right, I like the arguments, I hate getting my face ripped off, I love refuting nonsense arguments to buy stuff and I like slamming companies. CEOs hate me and it is fun talking gar-bahge about their 'action plans.' I work at a place that is a little more liberal with this and has a good legal team. Some banks this is next to impossible.
  4. Pay is increasing for ER work - some recent rule changes have worked in our favour - clients are paying analysts more for direct work and corporate access meaning slowly traders are becoming less valuable while ER remains the soul of the equities business. Solid analysts make a mint and have a nice life. It remains the engine of equities so claims that it is dying are not true in my view. The increased prevalence of hedge funds means they need more advice than ever.
  5. Parts of the job still suck- generally you are surrounded by peons and assholes but you get used to it. It never ends though - assholes are part of sell side banking and banking in general so you need a thick skin and just have to do well in the role you have or have been assigned. Eventually your skill will show and your boss/colleague/competitor will wig out and probably knife themselves and get fired. Then you rise to the top. Just be good at the task assigned to you.
  6. Getting in remains tough but definitely achievable. I appreciate all the messages I have gotten asking me whether he/she is suitable for ER and if he/she will get in. I can't really respond to all pf that suffice to say that a couple of things make for a great analyst - a) passion - you can't beat someone who loves the market - I love the market, and there are days when it sucks but i still enjoy it b) interest in the sector - if you like cars, cover autos, if you like beer, cover the drink stocks. It helps to like your work, c) decent instinct. I can teach associates to model, write and party at the right clubs, but i can't teach instinct. Instinct comes from experience and common sense - some practical knowledge or lateral thought. This may come from a sports club, or working at the Gap or teach first or being a poker player - any of this stuff is good way to get your mind right for the nonsense that is the market.

Anyway, I might be able to answer some questions for those who are interested. Please don't ask me for a job - I get that question a lot and I can't hook you up. I am not looking right now but I can help you understand the space better and definitely give you words of encouragement/advice.

May 14, 2015

Welcome back!

I'm going to be interning at a BB this summer in ER and hopefully turn that into a FT offer.

That being said, you come off as really candid and can probably give me a better answer than future coworkers regarding a couple of questions.

1 - I remember you saying you have a really loyal customer base but imagine you were just a typical analyst at a BB. How interested are clients in knowing the sell-side's view?

2 - Do you think it's very sustainable to have small HFs popping up all over the place and trading mostly on tips from the sell-side?

Thanks

  • Anonymous Monkey
  •  Sep 26, 2015

Hi Batman81,

You mentioned trading PA a lot more often now. I have heard mixed reviews of whether entry-level ER associates are allowed to hold trading accounts.

Some industry analysts have said all associates must liquidate their accounts before entering as a first year ER. Can you please verify if this is accurate?

Also, since you actively trade, are you required to disclose your holdings and trading activities to Compliance or HR? I am strongly reconsidering a career in ER since my trading account has been doing quite well and makes up a large portion of my overall income.

Thanks for the time!

Jul 6, 2015

Great posts with tons of useful information, thanks for that. Any advice on breaking into ER for a 28 year old who is completing his undergrad from a non-target next spring, and is married with a 10 year old son? I have experience working as a real estate analyst and am doing an internship at a local PE firm this summer. Would it be beneficial to not mention having a family when interviewing, even if they are a big part of my "story".

Jul 7, 2015

Salute to Mr. Wayne

Sep 3, 2015

Something I've always been curious about, why do most sell-side analysts give new management (i.e. after a change, firing, activist event) a pass for just about anything? Is the bank forcing you to do this or are you all just afraid of deviating from the standard and pissing off the new guy in charge?

Aug 9, 2013
SanityCheck:

Something I've always been curious about, why do most sell-side analysts give new management (i.e. after a change, firing, activist event) a pass for just about anything? Is the bank forcing you to do this or are you all just afraid of deviating from the standard and pissing off the new guy in charge?

It's a honeymoon period - just like having a new girlfriend I guess. You give people benefit of the doubt initially because they probably replaced some incompetent baffoon. Eventually they get raked over the coals don't you worry - and then they get fired of course after that.

Sep 4, 2015

Thanks for contributing to this community, greatly appreciated.

I was hoping you could let me know if you think I could break into ER with my background. I have 2.5 years credit risk experience at a European global investment bank where I am one of the better analysts. I also just completed all three levels of the CFA exam. I have plenty of modeling experience but all my work has a cash flow / credit focus and not EPS / share price focus. Sell side ER has always been of interest to me but I have yet to try transitioning.

Buy fear, sell cheer

Sep 4, 2015

What'd you major in undergrad?

Sep 5, 2015

Thanks for doing this, very helpful. One question, is it possible to make the switch into ER from corporate finance (think Disney, WB, Paramount) by solely getting a CFA and not an MBA? Thanks again for doing this.

Sep 8, 2015

No respect for anyone with less than 4 years experience? Because no one in their low/mid-20's can have intelligent investment decisions/research ideas?

Sep 9, 2015

Thanks for the great post!

Here are my questions:
1) Any specific tip to break into ER in London (e.g. where to look up for small firms, how to network effectively, how important is the "prestige" of your scholl etc.)
2) Would you consider a great selling point writing articles on websites such as Seeking Alpha or similar (obviously they'd have to be quality articles)?

Sep 9, 2015

Andy,

Thank you so much for your insight and time in typing this post. I'm new to this WSO and have already found it amazingly beneficial!

I feel more confident that this is the sector/division in finance I want to work in.

Thank you,

Gus.

Dec 15, 2015

Thanks for the great post Batman. This is by far the best thing for ER on the Internet.

  1. I just got a job at a MM ER firm as an associate coming from audit at big 4. I'll be in the restaurant/retail with a few industrials mixed in. Just wondering if you had any recommendations on how to excel as a newbie? Anyone I should be getting to know well? Anything I can read (I'm reading best practices of a ER analyst now and also brushing up on our coverage) I know it's been a while since you were a first year, but would appreciate any other tips for a person starting out in the industry.
  2. Just curious as to how you discover what makes a stock a buy/sell (differing from the general consensus). What are the most common ways you find the information that leads you to come up with the idea.

Thanks again for the thread

Dec 22, 2015

Quality post, Batman81.

Jul 7, 2015

Any advice on the resume format for lateral?

Nov 14, 2016
Comment
Oct 19, 2017
Nov 2, 2017

SafariJoe, wins again!