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Equity Research Career Path Advice

Currently working a job in Asset Performance Analytics and reporting at a boutique Investment Management firm. Based on my exposure in school, and what I've learned and been exposed too at my current position, I think I would really enjoy working in equity research.

I'm generally knowledgeable about different jobs and functions within equity research, hence my interest, but am less educated on things such as:

coming from a semi target school with a bachelors in Finance, an average GPA but solid experience (2 years worth), am I poised well to pursue entry level equity research positions or am I shooting for the stars here? I can expand on my resume if needed for a more accurate answer.

If more or more relevant experience is needed, what are some less competitive firms that I might have a better chance at getting into? On that note, relative to other industries (RE, IB, HF, etc...) how competitive is equity research?

Any other tips or advice on breaking in, or other important details I might miss are appreciated.

Thanks!

Comments (277)

Jun 3, 2017

Do you have any prior industry work experience (i.e. outside of finance) that might make you valuable?

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Jun 3, 2017

I have a good amount of client facing exposure and investor relations experience at this job and my previous job amd even my internship that i feel like could help me with establishing relationships with management teams, others in the industry, etc

Jun 3, 2017

I think if you haven't gotten one by now your best bet would be to take any job you can that's even remotely relevant - you haven't gotten one yet, and the chances are slimmer and slimmer the longer you go without doing something. I'd get the best job I can, work for a few years, and then try to move to ER

Jun 3, 2017

Ya, I was afraid someone was gonna say that. For me its just like f ck any 9-5 job where you're just sitting around waiting for the day to end. I need some adrenaline and I'm trying to do anything else but take a lame job.

"When you rely on the research of others, you can only know what they know" -- Random guy on CNBC a while ago

Jun 3, 2017

Have you done any ER? It's a lot of reading etc and not much adrenaline....

Jun 3, 2017

Haha, well I guess it's where the reading leads that is exciting to me.

I talk to a guy every now and again that's been in ER for most of his life, though now on the buy-side. He said he is still gets excited to get in everyday because things are ever-changing and decisions must constantly be made. To be honest, I'm not sure if adrenaline was the exact word I was looking for, however. I'm just looking for something with analytical problem-solving and competition where I'll be pushed to the limit.

Thanks for your input on this, btw. All advice I can get is very helpful at this point.

"When you rely on the research of others, you can only know what they know" -- Random guy on CNBC a while ago

Jun 3, 2017

I have done some ER (moved to IB after) and it's definitely interesting and very enjoyable. However, as I said in my first comment, if you haven't found one by now chances are you probably won't get an ER gig - in all honesty, moving to ER through a top MBA program is probably your best bet.

Not sure how much research you've done or haven't done on MBA programs, but even with a low GPA in college, if you can get some good (even pretty unrelated) work experience under your belt and get some solid ECs etc (and most importantly, show leadership/career progression) you could get into a solid MBA program in a few years and then move to ER after. Hard to see it happening another way (as in without further school - maybe a Masters in Finance would work too).

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Jun 3, 2017

Well I really do appreciate the advice. I'm not sure I'm willing to swallow that pill yet as I've just truly started looking this week. But I will keep your comments in mind as time wains.

As for grad school, I'd like to keep it in my back pocket for as long as possible. I do hope that some experience and my CPA & CFA will mitigate the damage of the low GPA.

"When you rely on the research of others, you can only know what they know" -- Random guy on CNBC a while ago

Jun 3, 2017

You just passed the CPA right? You can't get the license without work experience and most states won't let you sit without graduate school...

Jun 3, 2017
MrBateman10:

Been trying to land a spot in ER or something similar

If you want to break into the ER. For starters you're getting all the wrong experience...

CFA, DCF & Comps Modeling, and mock research on companies won't help when a patient comes into the ER at 2am with a compound clavicular fracture... or worse yet, a myocardial infarction!

For beginners, you'll want to attend a University and study the sciences (chem, bio, psychology), some schools may also have an undergraduate Nursing program you can attend. Subsequent graduation, it is common to volunteer for a year or two while studying for the MCAT and obtaining your EMT certification, before entering into an DO/MD, PA, RN, or Nurse Practitioner program.

In you're graduate program you'll want to do rotations in the ER, and develop relationships with some of the Managing Doctors on the floor. Networking will be key to obtaining a position post graduation as the ER is a very sought after department in most hospitals, there are long hours, high pay, and constantly changing scenarios.

"A man can convince anyone he's somebody else, but never himself."

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Jun 3, 2017

Sounds like you are doing all the right things. I would suggest reaching out to people who have a similar background as you such as having had worked at the same firm or graduated from the same university. In my experiences, these types of people were very willing to help me out.

Jun 3, 2017

getting into ER has a lot more to do with luck and networking than you think

Jun 3, 2017

Keep GPA up and take Dec '18 CFA level 1. Can your dad just say that you were a summer ER associate at his HF? Works better if your family's last name isn't in the fund's name.

I didn't get into ER via campus recruitment, so I'm not an authority, but I'd have to imagine you'd at least be able to get interviews.

Jun 3, 2017

Take the CFA Level 1 before you graduate.
Practice writing up equity research reports/doing some modeling. Attach these to any ER job you apply for.
Try to get an ER internship for the coming summer, your best bet would be to apply far and wide and network your ass off.
MF/MBA won't help you get into ER, networking studying for the CFA and practicing writing ER reports/modeling would be a much better use of your time

Jun 3, 2017

You have missed the boat... most firms are done recruiting. Maybe you still have a chance at some smaller ones.

Jun 3, 2017

I think it could be attractive with the caveat that you spin the industry knowledge and experience in whatever sector your F500 company is in to join a research team covering that industry. For example if you're a sales analyst at Verizon, you could leverage that to join a telecom team. Analysts like people with industry experience and the CFA program and relevant major should help. Other than that do some investing on your own (good conversation topic/shows interest) and have good stock pitches for interviews.

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Jun 3, 2017

Thank you very much for you reply

I've been flustered recently trying to figure out how to get where I want to go. Your response has given me a little more confidence in pursuing opportunities that are not directly in the Investment realm. Hopefully with enough effort it will all turn out well.

Thanks again!

Jun 3, 2017

I think there are two main components to being qualified to work as an ER associate:

  1. Knowledge of finance/accounting/valuation
  2. Knowledge of the sector that you cover

You seem to have a good game plan that hits both of those. I did BIWS courses and then created my own models for a few sectors. Through my network, I was introduced to some SS analysts and eventually one of those conversations led to an interview. Having a research report (1pg writeup) and a 3-statemet model will help. I would pick a relatively simple company and try to create a model and come up with some investment thesis.

It is definitely a tough area to break into given how few seats there are and how unpredictable turnover is but if you have a mind for ER, you will be grateful when you get in.

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Jun 3, 2017

Thanks so much man. The main modeling techniques that I should know are DCF analysis and comps right? Only ask because you say models. That's awesome that you got in through networking. I will be doing this hard as soon as I have my write-up/model.

Sorry, I'm still new to do this, but by the 3 statement model, do you just mean the DCF?

And yes, I clearly have a steep learning curve ahead of me, but this is something I'd like to learn and although a little challenging, look forward to the process

Jun 3, 2017

Most equity research groups use multiples (trading comps) to do valuation. My sector just uses P/E multiple. We forecast next-twelve-months of earnings, slap a multiple on it and are done.

By the 3-statement model, I mean to create an income statement, balance sheet and cash flow statement and forecast everything out 5 years. I used BIWS advanced modeling guide to help me get started with this and recommend it.

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Jun 3, 2017

Ok great to hear. Yeah, I actually didn't know that some firms don't use DCFs. I'm gonna learn tht anyway, but yes, I actually got those guides recently, and didn't realize there was a whole section on projections. That part was stumping me the most. Good to hear, I definitely have the resources; now just to make it happen. Thanks for your help man!

Jun 3, 2017

I would not rule out IB just because you are an international student in the USA. Many internationals work in IB in the USA and are seen everywhere on the street. Just believe in yourself and pursue what you are interested in whether it be IB/ER.

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Jun 3, 2017

Thx !

Jun 3, 2017

1) A virtual portfolio doesn't hold much weight. Anybody can enter into an investopedia stock picking contest and throw around fake money. What matters is that you have skin in the game. There is a huge difference between picking stocks with fake money and picking stocks when you're using the money that you've worked hard for and it would hurt to lose it. Additionally, when you are using your own money, I guarantee that you will conduct much more thorough research and analysis because you're putting your money at risk. It will also allow you to learn things about yourself and understand the emotional aspect of investing and the biases that come along with it.

2) Comparables analysis is good when it is supplemental to fundamental analysis. Generally in ER, you're going to take a dive into the company and undertstand it from a fundamental standpoint. Once you have a thorough understanding of the business, then you can use a comps approach and look at it vs. its peers and why they are trading at different multiples, etc. I would really recommend at least building full models for a few companies. You'll be modeling companies in ER and it would be great to speak from experience in an interview. It will also help you learn how your assumptions can drive changes throughout the model and affect your final valuation.

3) These are the questions I received about my personal portfolio during the interview process:
-"What's the best/worst trade you've made?"
-"What is the biggest mistake you've made investing? Why did you make it? What did you learn from it?"
-"What is the last stock you bought/sold? Why?"
-"What do you all have you in your portfolio?" - If you use index funds like Vanguard, I would not bring these up. It is an ER analyst's job to believe that the markets are not efficient and if you say that you use index funds they may question your passion for research.

These are the types of questions that can't be answered with a virtual portfolio. I would recommend looking around and seeing what brokerages will allow to start an account with a smaller sum. Even having $500 in the game is 10x better than running a fake portfolio.

ask why, asshole

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Jun 3, 2017
ldfrench:

1) A virtual portfolio doesn't hold much weight. Anybody can enter into an investopedia stock picking contest and throw around fake money. What matters is that you have skin in the game. There is a huge difference between picking stocks with fake money and picking stocks when you're using the money that you've worked hard for and it would hurt to lose it. Additionally, when you are using your own money, I guarantee that you will conduct much more thorough research and analysis because you're putting your money at risk. It will also allow you to learn things about yourself and understand the emotional aspect of investing and the biases that come along with it.

2) Comparables analysis is good when it is supplemental to fundamental analysis. Generally in ER, you're going to take a dive into the company and undertstand it from a fundamental standpoint. Once you have a thorough understanding of the business, then you can use a comps approach and look at it vs. its peers and why they are trading at different multiples, etc. I would really recommend at least building full models for a few companies. You'll be modeling companies in ER and it would be great to speak from experience in an interview. It will also help you learn how your assumptions can drive changes throughout the model and affect your final valuation.

3) These are the questions I received about my personal portfolio during the interview process:

-"What's the best/worst trade you've made?"

-"What is the biggest mistake you've made investing? Why did you make it? What did you learn from it?"

-"What is the last stock you bought/sold? Why?"

-"What do you all have you in your portfolio?" - If you use index funds like Vanguard, I would not bring these up. It is an ER analyst's job to believe that the markets are not efficient and if you say that you use index funds they may question your passion for research.

These are the types of questions that can't be answered with a virtual portfolio. I would recommend looking around and seeing what brokerages will allow to start an account with a smaller sum. Even having $500 in the game is 10x better than running a fake portfolio.

Thanks for your very detailed reply, couldn't have asked for a better one!

1) I think that's a fair point, I just wanted to confirm it. I don't have loads of spare cash laying around (far from it), but I can afford to put say a thousand or so into a few different stocks and it won't affect me at all.

2) The reason I'm thikning of using the comparables approach is that I can use that to capture a wide array of companies and then narrow down my search from there. Otherwise it would be much more difficult to find a company out of all the FTSE listed ones and then start modelling it. I could do a two tiered approach by first using comparables to find one that seems undervalued and then building a more comprehensive model to see if the fundamentals analysis (which I'd do anyway but on a much less substantial level if not modelling comprehensively) adds up to it being a good investment in my opinion.

3) Thanks for the questions, those seem quite reasonable ones and definitely ones where having a portfolio will help me answer them.

Jun 3, 2017

I think you should focus on understanding how a research process works and building out a rounded thesis before you start messing around with portfolios. The best way to see if you like doing fundamental research is spending a couple weeks/a month or so studying a single company.

Jun 3, 2017

I've never actually had a portfolio when I went in for interviews. I think it's fine to not have one, so long as you still demonstrate an interest in the markets and that you've put in some effort to learn fundamental analysis. I would say to just pick a company that seems interesting and dive into it. Doesn't have to be the most attractive stock. Your research process might tell you that the stock is fairly valued, but the important thing was the process and not whether you actually traded the stock

Jun 3, 2017
cob5:

I've never actually had a portfolio when I went in for interviews. I think it's fine to not have one, so long as you still demonstrate an interest in the markets and that you've put in some effort to learn fundamental analysis. I would say to just pick a company that seems interesting and dive into it. Doesn't have to be the most attractive stock. Your research process might tell you that the stock is fairly valued, but the important thing was the process and not whether you actually traded the stock

Thanks. I think this makes sense since at least as a sell side analyst your job isn't necessarily stock picking but more about giving an opinion on a company (or so it seems to me). Obviously this is different for an analyst working in a fund as their job is very much about finding good buys.

This is making me think that in addition to buying some stocks, it might be beneficial to just try and model some companies I find interesting and see how close I get to the quarterly earnings reports as that will be a closer approximation of the work of a sell side analyst.

I presume a chartered accountancy background (which is where I'm coming from) is beneficial for fundamental analysis as you've got a good grasp of many of the financial reporting and accounting issues?

Jun 3, 2017

I personally think it's still important to have a personal portfolio to show interest. There are other ways such as stock pitch competitions, etc, but if you don't have that, then a personal portfolio certainly helps. For sell-side, it's okay if you pick a loser. Just be able to explain why you picked it and why it didn't work.

I wouldn't waste time with a comps. All that shows is that you can calculate ratios.

Just use a stock screener available (e.g. finviz) to narrow it down. Once you decide on a company, dive into their financials and MD&A. Build a DCF valuation model if you can. Perform a fundamental analysis and incorporate all the applicable relative valuation multiples (of the company and of its peers) into your write-up.

Jun 3, 2017

Accounting background is helpful but can hurt you if you don't understand the difference between accounting standards and economic reality. I got in with my own initiation type reports. tons of detail that demonstrates industry and company specific characteristics along with showing your modeling and writing skills. Don't pitch hot stuff like Apple or tesla that Jim Cramer talks about all day.

Jun 3, 2017

Thought I'd post a bit of a progress update:

I have set up my own stock portfolio and invested into a few stocks. I currently have 3 stocks in it and am about to add a 4th. For 3 of these stocks I've built some relatively simple models and come up with my own valuations (however flawed my assumptions may be). I think I've got some alright points as to why I've picked these companies to invest into.

Would this be a good platform off of which to try and sell myself to Equity Research roles?

Jun 3, 2017

Its less about talking about your portfolio and more about being able to talk about individual stocks. Having a portfolio helps in that if you pick stocks for your portfolio you have a library of stocks and investing experience to talk about during your interview. E.g. I made X% on this stock last year, i picked it because it was valued at x.x p/e discount to peers despite having x and x. Consesus EPS was x but I thought it would be x. Catalyst for re-rating higher for me was x. Etc., etc. Even if you are wrong having actual experiences to talk about will engage your interviewer in a way that someone that hasn't made or lost money in the market will not be able to. That is the upside to owning real stocks. Plus you will find that you remember the ups and downs of the stock much more and will be much more motivated if your entire savings is riding on it.

Once you mention what stocks you own that will open you up to questions on the specific stocks though. So if you don't know a company really well just don't mention it. If you made 40% profit on a company but can't answer detail questions about it (multiples, why is it cheap?, catalyst, business model vs peers), it won't help you much.

Jun 3, 2017

The most important thing to do is to network, network and then network some more. Craft a compelling story about why you want to be in ER and be ready to demonstrate your passion for the markets. Write more reports and build more models.

If you're really set on making a move consider an MBA. This is a higher risk move since ER hiring is not as structured as banking, so timing will make a big difference, but this is how I (also a CPA) and several others I know broke in. The reason why the MBA helps is because it affords you access to a network of people in research who can refer you in. If you don't want to do an MBA, then start your CFA to show you're serious about a career in research.

Jun 3, 2017

Thanks for the advice on this. I am really trying to avoid the MBA route if I can get away with it but really like the point about the CFA. Going to have to get myself going on level 1.

Jun 3, 2017

Most people on this forum will probably say that breaking into ER is 'easier' than a product group, and also say that sell-side ER people are blowing smoke 95% of the time and don't provide real value. I think the fact that you're finding more roles is just a reflection of need instead of 'prestige'. Both are great FO roles.

Jun 3, 2017

Actually, I'd say its harder, but that depends on what stage in your career you are at. If you have experience, my impression is that it is easier. If you're in college, then IB is probably easier because most ER recruiters look for a few years of experience.

"There's nothing you can do if you're too scared to try." - Nickel Creek

Jun 3, 2017

You raise a good point. I stand corrected.

Jun 3, 2017
sfgfan10:

Actually, I'd say its harder, but that depends on what stage in your career you are at. If you have experience, my impression is that it is easier. If you're in college, then IB is probably easier because most ER recruiters look for a few years of experience.

What if I have 2.5 years of FP&A experience and want to switch over to IB? What do I have better chances at?

Jun 3, 2017

I haven't worked in IB (I've interned in ER) so you'll have to ask someone else that question. I would think you'd be able to get into ER though.

"There's nothing you can do if you're too scared to try." - Nickel Creek

Jun 3, 2017

Without getting into which is harder, I'll say that breaking into ER is different. There are fewer positions available because ER teams are much smaller. Analysts usually only have 1-2 associates and teams don't need to be much bigger than that for the most part. You also aren't necessarily expected to leave after 2-3 years the way you are in IB so you tend to have lower turnover as well.

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Jun 3, 2017

Yeah ER is not your typical 2 and out program, it's much more for people who know they are in it for the long haul/ only want to leave for AM or HF. Your exit opps are more limited and can be harder to leave than the established IB recruiting pipelines.

That being said, ER hours are much better, I would argue that the people are more down to earth depending on where you go, and you are going to learn a lot. Some ER analysts may just blow smoke on their investment recommendations, but the level of detail and quality of analysis you do on these businesses really helps you learn more than plugging in random numbers into a model to get a deal where your MD thinks it should be. I felt like I added a lot more value to our work than my peers in IB did, and as a result I was a lot happier.

As for difficulty, an ER as a whole is smaller than IB. Intern classes are generally 15-25 people at BBs, of which very few do not accept full time offers. So if you are trying to break in FT, you are looking at 2-3 spots per BB available, most of which get staffed by internal transfers from other divisions or other firms. However, this doesn't really talk about acceptance rates. The number of people interested in ER is most certainly less than IB, so there's not a definitive answer as if ER is more selective than IB. They certainly have preferences for interns/analysts who have investment backgrounds over FP&A, but plenty of FP&A people work in ER.

Jun 3, 2017

Being pedantic, but want to point out that ER =/= IB.

Some fair points above - consensus based on what I've seen and heard indicates that ER is typically less "competitive" than ib because fewer people want er. However there are fewer spots and turnover is much lower (and hiring is often as hoc rather than structured - doesn't really apply to you though as you've already worked so would be as hoc anyway) so that aspect makes it difficult. Bet net hard to say for sure.

Finally, while it's usually true that er is a better lifestyle etc it depends on where you go - I know people in er who worked banking hours - so do your due diligence before picking a place and expecting it to be more cruisy than banking

Jun 3, 2017

First of all, if you want to break into ER, I highly suggest you network your way in, just as you would in IB at that point in your game...unless you're considering grad school. Second, I would choose a few focus sectors, so that you can really narrow in on your choices and have a few good pitches and show some enthusiasm around a particular space when you interview...trust me, analysts want to know that you're in love with the space (it helps to know that because during earnings...if you dislike the space, you'll hate your job and your analyst will probably hate you, haha)...lastly, I wanted to say that I think I work pretty close to banking hours as an associate. During regular work weeks, I work typically from 7am to 9pm. During earnings, banking deals, or initiations, imagine days of 6:15am to 1am+

Anyway, that's just some food for thought, hope that helps.

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Jun 3, 2017
derpherpderp4760:

Anyway, that's just some food for thought, hope that helps.

As in, in the office for that whole time frame?

Jun 3, 2017

Yes.

Jun 3, 2017

Great info in this thread. Could anyone speak to ER recruiting out of business school for career switchers?

Jun 3, 2017

Try applying to Greene Holcomb Fisher in Minneapolis.

Jun 3, 2017

IB and ER are quite different. I'd look into ER positions in Minny given your profile.

Jun 3, 2017

Thanks for the advice,

I'm leaning more towards ER at this point. There just aren't that many ER positions in Minneapolis, where most of my connections and network are. Would I have any shot at ER outside of Minnesota without extensive networking? Or is my school too non-target? Any tips or advice for a non target trying to break into a new market?

Jun 3, 2017
swan1470:

Thanks for the advice,

I'm leaning more towards ER at this point. There just aren't that many ER positions in Minneapolis, where most of my connections and network are. Would I have any shot at ER outside of Minnesota without extensive networking? Or is my school too non-target? Any tips or advice for a non target trying to break into a new market?

There aren't a ton, but there are more than you probably have considered.

Piper, Craig Hallum, Northland Securities/CM, JMP has an office there... and there are a few others (RBC may have someone, Bernstein has some positions similar to ER, etc.)

Jun 3, 2017

Look into Piper Jaffray, I think they're HQed in Minnesota. Look for anybody in your network that currently works there

Jun 3, 2017

Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Jun 3, 2017
swan1470:

Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Under my tutelage, you will grow from boys to men. From men into gladiators. And from gladiators into SWANSONS.

Jun 3, 2017
Flake:
swan1470:

Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Do you think an MBA (perhaps + CFA) would be an option for him?

Jun 3, 2017
peinvestor2012:
Flake:

swan1470:
Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Do you think an MBA (perhaps + CFA) would be an option for him?

I appreciate the help,

I guess what I'm really wondering is what are the best non traditional ways to get into ER?

Jun 3, 2017
peinvestor2012:
Flake:

swan1470:
Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Do you think an MBA (perhaps + CFA) would be an option for him?

Now? No. After a couple years in BO / other finance, having MBA + CFA could definitely help you break in

Jun 3, 2017
Flake:
swan1470:

Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Kinda ironic from you, no?

I agree though, not the preferable route.

"For I am a sinner in the hands of an angry God. Bloody Mary full of vodka, blessed are you among cocktails. Pray for me now and at the hour of my death, which I hope is soon. Amen."

Jun 3, 2017
duffmt6:
Flake:

swan1470:
Yeah, there are a decent number of firms but they just don't hire that many people. I've already been turned down by Piper, GHF, Craig Hallum, Northland, Dougherty. The positions were going to Ivy/Northwestern kids or MBAs. I know RBC has a decent sized research presence in Minneapolis but they only have back office stuff right now. Any thoughts on going back office, getting my CFA and then trying to break in to ER? Or is that a death trap?

Death trap.

Kinda ironic from you, no?

I agree though, not the preferable route.

Clearly not now. How on earth is he going to get into a reputable MBA program with no work experience.?

Jun 3, 2017

Do you have any time to study for the CFA for December? My firm's ER branch (MM) gives preference to applicants who have already completed Level 1 for their entry Associate position. Having Level 1 done would definitely be a HUGE advantage to you when it comes to recruiting.

Jun 3, 2017
StryfeDSP:

Do you have any time to study for the CFA for December? My firm's ER branch (MM) gives preference to applicants who have already completed Level 1 for their entry Associate position. Having Level 1 done would definitely be a HUGE advantage to you when it comes to recruiting.

Yeah, I'm sitting for it in December. I would like to work while I get it. Are there any jobs with a chance of leading to ER?

Jun 3, 2017
swan1470:
StryfeDSP:

Do you have any time to study for the CFA for December? My firm's ER branch (MM) gives preference to applicants who have already completed Level 1 for their entry Associate position. Having Level 1 done would definitely be a HUGE advantage to you when it comes to recruiting.

Yeah, I'm sitting for it in December. I would like to work while I get it. Are there any jobs with a chance of leading to ER?

You could definitely consider a corp finance role of some sort in a particular industry you enjoy, and then try to break into an ER firm that covers said industry after getting your CFA & obtaining industry knowledge. It would without a doubt show that you have a strong interest in both getting into ER & that particular industry.

Jun 3, 2017

I got into sellside ER in a non-traditional way. I worked a year and three months in a niche valuation consulting firm out of undergrad, passed my CFA level 1 exam in December, (taking CFA level 2 exam in a few days) and recently began working at a middle-market investment bank in sellside ER. I had an investment banking internship on my resume (reputable boutique) during college though. I had pretty good stats all around though, 3.5 GPA, west coast target, interest in CFA, leadership/community involvement, etc. I would recommend passing at least level 1 of the CFA exam to demonstrate interest. I think during interviews there were definitely candidates who had better resumes than me, some even with sellside ER experience already, but I had "the story" so to speak. My story was about why I didnt want to do IB and wanted sellside ER and why the industry coverage interested me. January-April is the best time to keep an eye out for postings as associates jump ship after getting their bonuses.

Jun 3, 2017

Not that I'm the best example, having gone into ER straight out of undergrad, but ER also attracts people from non-finance backgrounds with a deep industry knowledge. For example, many healthcare/medical device/biotech analysts have clinical or academic backgrounds. Even if you put ER on hold for a while and do something else, you can potentially leverage your knowledge of an industry to break in down the line.

PS. Why do you believe you can't "hack it" right out of undergrad? Maybe you should consider doing something to boost your confidence. Your insecurity may be coming through when you're meeting with people.

Learn More

Side-by-side comparison of top modeling training courses + exclusive discount through WSO here.

Jun 3, 2017

I agree. I am starting to recruit for ER internships now (starting b-school in the fall) and the recruiters/associates i've spoken to always like that I have money in the markets. More then just being something good to tell recruiters, it almost guarantees you will know what is going on in the markets (with your money on the line, you tend to follow the markets much closer).

As far as how to open an account, just pick a discount broker and you can start trading as soon as you fund your account. If you work at a bulge bracket, or any sort of financial services firm currently, you may want to check your firm's employee trading policy. If not, then you can pretty much pick any broker you want. Some brokers have paper trading which allows you to trade with fake money. You may want to do this first just to get a feel for what its like. I know think or swim use to allow paper trading a couple of years ago, but dk if they still do since being bought by TD ameritrade.

Jun 3, 2017
mbaer2012:

I know think or swim use to allow paper trading a couple of years ago, but dk if they still do since being bought by TD ameritrade.

For the record, they still do; that's what I use.

Currently: clinical psychologist (in training)
Previously: investor relations (top consulting firm), M&A consulting (Big 4), M&A banking (MM)

Jun 3, 2017

Optionshouse is extremely cheap in comparison ($4/trade) and allows for a virtual account FYI.

While this may not exponentially increase your odds of getting recruited, I think it does give you an edge and is a bonus point for recruiters in regards of something to talk about and help legitimize your case.

"History doesn't repeat itself, but it does rhyme."

Jun 3, 2017

My ex-firm used to encourage ER interns to use the investopedia simulation. Practical experience is a big plus. A good friend of mine screwed up an interview with CS because her response to what she does in her spare time revolved around hanging with friends and watching TV. Panel was looking for a weekend activity in trading/stock tracking.

Jun 3, 2017
SaucyBacon85:

My ex-firm used to encourage ER interns to use the investopedia simulation. Practical experience is a big plus. A good friend of mine screwed up an interview with CS because her response to what she does in her spare time revolved around hanging with friends and watching TV. Panel was looking for a weekend activity in trading/stock tracking.

Really? Admittedly, I am not in ER, but saying that you invest in your free time strikes me as saying your favorite book is The Intelligent Investor. If that's why they rejected her, that is rough.

Jun 3, 2017
West Coast rainmaker:
SaucyBacon85:

My ex-firm used to encourage ER interns to use the investopedia simulation. Practical experience is a big plus. A good friend of mine screwed up an interview with CS because her response to what she does in her spare time revolved around hanging with friends and watching TV. Panel was looking for a weekend activity in trading/stock tracking.

Really? Admittedly, I am not in ER, but saying that you invest in your free time strikes me as saying your favorite book is The Intelligent Investor. If that's why they rejected her, that is rough.

It was more of a ER/trading job. They rejected her beacuse she displayed no interest in investing (or the industry) in her personal life. Having passsion for the field is a huge +1 in ER/trading. The hours & work is way too brutal for you to be tracking tickers and earnings reports for the mere sake of a 9-5 job. You've gotta love the shit. The best analysts are people who eat drink and sleep their chosen fields. My floor manager (a God-like being) would spend a good chunk of the weekend getting on top what's coming in the next week. On monday he'd be telling us stock headlines before they hit the wires.

Jun 3, 2017

No PA (real or paper), is a ding-able offense. Also never say "efficient market hypothesis" in a interview.

Jun 3, 2017

I'm not a fan of using first person in work experience bullet points:

"Frequently engage my curiosity for the equity markets by starting
insightful conversations with clients.."

"Taught myself how to use Fidelity's Active Trader Pro Platform and gained a comprehensive understanding
of the online website, which helped me generate the most leads for my team in November"

I also don't like seeing "CFA level 1 candidate". Everyone and their mother is a CFA level 1 candidate. You haven't accomplished anything until you actually passed the first exam.

Lastly, take out all of your personal information.

As for the rest, hopefully someone else will be more helpful.

Under my tutelage, you will grow from boys to men. From men into gladiators. And from gladiators into SWANSONS.

Jun 3, 2017

Dude, you need to make your resume more anonymous. Get rid your name, school, number, email address and places you worked before and re-up.

Seems a bit cluttered for my test. Use the M&I format Google it. Have you school on top below your name and so forth. Would but all the series you earned in the bottom of the resume.

Also, get rid of "Passed the Series 7 & 63 exams in less than five weeks because of my ability to assimilate new ideas quickly "

Jun 3, 2017

Bumping this for advice.

Jun 3, 2017

Apply to any ER position you see and as many as possible.

Jun 3, 2017

Thanks

Jun 3, 2017

One more bump on this.

Jun 3, 2017

I lateraled from IB, so did everyone in my office. It's pretty common bro. Similar pay, better hours, closer to the market.

Jun 3, 2017

You occasionally see people come from the industry they cover. For instance, Mike Mayo was a bank examiner before he went into ER, covering banks. Actuaries might cover insurers, biomedical engineers and doctors might cover pharma/biotech, etc.

I think this is more common in more esoteric industries - you don't need to have experience in a consumer goods company to be a good consumer analyst.

newfirstyear:

I lateraled from IB, so did everyone in my office. It's pretty common bro. Similar pay, better hours, closer to the market.

Same here, or rather IB SA w/ return offer to ER FT

Jun 3, 2017

I see it happen more from the corporate finance side rather than the IBD side, but this is from my experience. I don't doubt though that you can lateral from IBD. I think if you work in an investor relations department for a F500, you have a fairly good chance of moving to ER if you play the right cards.

Jun 3, 2017

I know people lateral from IB, I'm sure it's a popular move. I just meant that my question was targeting experiences and thoughts about people lateraling from other industries like commercial banking or corporate finance.

Jun 3, 2017
gulfcoastbanker:

I know people lateral from IB, I'm sure it's a popular move. I just meant that my question was targeting experiences and thoughts about people lateraling from other industries like commercial banking or corporate finance.

I know a couple people who lateraled from a F100 corporate finance and BB corporate banking into ER... note that these people were constantly plugged into the markets, gained a lot of in-depth industry specific knowledge after 2+ years in their previous jobs, polished up their modeling skills, and then networked their way in.

Jun 3, 2017

Appreciate all the insight, sounds like in order to be competitive one needs to be very active on their own while not at work. Staying as close as you can to the markets, staying up to date on news affecting your industry, working on modeling skills, and networking. Any ideas on how to polish up on modeling skills on my own time? Thanks

Jun 3, 2017
gulfcoastbanker:

Appreciate all the insight, sounds like in order to be competitive one needs to be very active on their own while not at work. Staying as close as you can to the markets, staying up to date on news affecting your industry, working on modeling skills, and networking. Any ideas on how to polish up on modeling skills on my own time? Thanks

Well it depends on your current excel and modeling skills/experience ... but Wall Street Prep (WSO) and Breaking into Wall Street (M&I) both offer self study valuation and modeling courses. They can add up to a few hundred dollars so I would do some research before purchasing them. Also, you should definitely be cognizant of the differences between standard banking modeling (firm valuation from the target's/acquirer's point of view) and ER modeling (focuses on equity valuation from the investor's point of view)

Jun 3, 2017

I work within a Credit Risk at a BB - not IB; we travel around and audit third party vendors for compliance with state, fed (Dodd Frank), investor, etc. guidelines and analyze their policies, procedures and systems/software for gaps and weaknesses via interviews with execs, management, staff, etc. writing summary reports for our execs to determine future work allocations.. Our annual book of work is valued at over 1B or so. My boss asked that I write up a statement describing my career aspirations and what kind of projects, responsibilities, and competencies/skills I should undertake and/or polish in my current role that would aid in transitioning to a different dept./role (trying to get into research). So with that, any suggestions? I have a writing background and really do enjoy peeling back the 'hood' to look at how a company operates but just not on the same level as a research analyst would, with the financials being one of the larger puzzle pieces of the companies we don't normally review..

Also (as part of my career development - my boss is the $hit), I just moved to NYC to be closer to the 'action,' business schools, The Street, and wondered if any of you guys get up for dranks outside of the scheduled WO Happy Hour sessions? I'm working in Downtown Brooklyn, Metrotech.

Jun 3, 2017

I'm not in ER but know a handful of people that are. They all came in from industry, but I'm in an O&G city, and oil is one of those industries where first hand experience will teach you more than an MBA, so I wouldn't automatically assume that's normal.

Jun 3, 2017

You quit your job without having another one lined up?

Jun 3, 2017

I was preparing for the CFA II this June and quit the part-time internship. It was at a small town and unpaid. Then I moved to NYC and trying to find a full-time or internship here.

Jun 3, 2017

Dumbest mistake prospective ER candidates make is just applying to the BBs, e.g. Barclays, Credit Suisse, etc.

They aren't going to hire you until you have a few years of experience. You need to go small to a boutique, independent research shop, or something along those lines. There really are A LOT of opportunities out there yet candidates lack the ability to find them.

Ergo, my advice - look harder.

Online you need scrutinize every posting on efinancialcareers, recruiting firms, monster, indeed, linkedin, etc. The more time you put in it, the more likely you will find some of the lesser known openings out there.

There's a big need in the ER industry for people who can crunch some numbers and do some research, things you don't need years of experience to do.

Even if you can't find ER any sort of research position is a good experience. There are multitudes of market research firms that can give you some good skills and something to put on your resume. You can even try consulting or capital markets research and put yourself in a good place.

Jun 3, 2017

At this pt it's all a numbers game, keep chugging.

I'm on the pursuit of happiness and I know everything that shine ain't always gonna be gold. I'll be fine once I get it

Jun 3, 2017

I think anyone who quits a job (paid or not) to study for the CFA is making a huge mistake. I've read people doing that on anaylst forum... lol

Jun 3, 2017

Being European, maybe I'll be able to share some experiences with you:
- go for rather big firms only. Boutiques and the like won't even bother caring about visas, even if student visas are (basically) free and super flexible
- sign up for linkedin and xing, get a premium account for the latter
- reach out to Swiss/German/Austrian or maybe other European guys working in the US
- reach out to guys in Switzerland/Germany/etc. who have worked in that field in the US, they might have contacts
- reach out to guys in Switzerland/Germany/Austria currently working in the field for general networking and future opportunities in Europe. You'll a) need a back-up plan in general and b) assume that you won't be able to make it to the US anytime soon, so even an internship in Zurich or Frankfurt in one, two, three years might be a start
- don't even bother contacting anyone in HR in the US. They are useless as sh*t over there. Way way more so than in Europe.
- don't make a quick trip to the US. It won't pay. You won't be able to make as many contacts to justify the effort/cost. Don't even think about it
- also consider the Big4 for non-ER internships immediately in Switzerland, ideally their advisory stuff. They do international internship programs, allowing you to maybe do an internship (even if it's nothing related to ER) in the US at some point down the road; this way you'll be able to say "hey, I already worked in the US" und might be able to meet some people while you're there, even if it's not until two or three years from now.

Jun 3, 2017

Thanks for your response!
I always considered Big4 as a good starting Point, because they are offering internship to freshmen/first year which Banks dont...
So I will apply for various internships at Big4 firms in Germany, because they have more opportunities than in CH...The most interesting internship I ve found is in forensic service (advisory). Do you consider this internship as a good starting point for getting into ER/S&T or should I am in another direction within the advisory stuff?
Btw., did you go to WHU?
Thx

Jun 3, 2017
SwissChocolate:

Thanks for your response!

I always considered Big4 as a good starting Point, because they are offering internship to freshmen/first year which Banks dont...

So I will apply for various internships at Big4 firms in Germany, because they have more opportunities than in CH...The most interesting internship I ve found is in forensic servic