Financial Advisor trainee programs...good way to break in?
I have been working at a boutique real estate brokerage for a few years now, but I would like to move into a finance position (I have worked in various real estate positions for the past 7 years). I have a top 25 ugrad degree, and an ivy masters (both non finance related), and live in NYC. I am thinking about sending resume's out to the big names in the industry like Merrill Lynch, Morgan Stanley, UBS, etc. Financial Advisors seem like nothing more than stockbrokers to me, however if these 2-3 year training programs that these BB shops have are any good, won't I at least have some decent finance exit opportunities even if I end up not wanting to be (or can't hack it) an FA? Is this a good way to break into finance, or will I be wasting my time? I'm not looking to get rich quick, and I have no problem paying my dues, and slogging it out for a few years if I'm learning something valuable and there is the potential for good pay down the line, but I'm also 30 years old and don't want to waste my time if this is a dead end career choice. Are there any other trainee programs out there that might be more stable that I should look into? PWM for example?
You are right, financial advisor is just a euphemism for stock broker. It is a 100% sales position. If that's the career path you want, then go ahead and do it. But, it won't lead to any exit opportunities.
Stock brokers do not exist anymore; please do not take career advice from someone who clearly is not in the industry and has no experience working in PWM/Wealth Management.
The sales aspect of this career is almost exclusively in the beginning when trying to build a client base. After about 5 years you will have an established book of business and generally will generate all new buisness via referrals. In terms of working with clients you will never sell anything. No pitching stocks, no pitching bonds, etc...that type of buisness is dead. What you will be doing is working with your clients to help layout actionable plans to help them save for retirement, college savings for the kids, work on estate planning needs, etc...and then manage their financial assets based on the timeline and investment need of the client.
I personally run discretionary investment portfolios within my practice so I have full control with how the asset allocation models are constructed, which investment products I use to populate the asset class requirements and the timing on when I enter or exit a position. I manage money, over 150MM+ and to compare what I do to an old fashion stock broker is laughable
Now, moving to exit opportunites....I will be the first to admit that there are not a lot of exit opportunities if you want to jump over to the instiutional side of the business. If that is your end goal, don't waste your time working in retail. The skill sets you develop will not directly translate over and in most cases your hard work will not be understood or respected.
If you want additonal details feel free to PM me.
Yes, pitching stocks is largely dead, but you're just pushing SMAs, hedge funds, and mutual funds the same basic way as it was done 20 years ago. It is a 100% sales job. You aren't given clients, you must get them yourself and that is what you're getting paid for.
You must be a good salesman if you believe what you do is radically different from the stock brokers of the 1980's and 1990's. Yes, you give diversified portfolios to clients instead of a handful of stocks/bonds. But, the most important aspect of the job is acquiring and retaining clients and the revenue associated with them. There's nothing wrong with that. I happen to think it's a pretty good career if you are a good salesman. But, the OP asked if he did that for a couple of years would it help him break into other parts of the bank. I think we both agree that the answer is clearly no. Not sure why you felt the need to attack me based on what I wrote.
@sfbroker I am interested in curating custom portfolios for private individuals later on down the line & would like to gather information to get the ball slowly rolling. Would you mind answering some questions for me? It seems as though this is your expertise. Do you use special software to construct the asset allocations models or is this done by using stock screeners, DCF or DDM valuations, & risk/volatility of the asset according to the appetite and IPS of the specific client? Do you use software to help calculate entry/exit points or support/resistance & technical indicators to determine high probability of a successful entry/exit? What would you recommend is the best way to structure your RIA business; LLC & elect to be taxed as an S-Corp or is there a better recommended structure? Thank you for your time and insight.
you will always be selling something...lets be real. It may not be a stock/bond, but its a different product (wrap account, 529s, etc), at the end of the day you are pitching a product that will pay you, you are in sales. You may manage money as a byproduct of this (and maybe you do it well and maybe you dont), but FAs primary always seems to be continued business development and asset gathering, afterall thats what makes you money. Exit opps seem to be more oriented toward sales/relationship positions than an actual investment role
We are paid based on the level of AUM we manage....that much is true. As to the account type or product that is recommeded this is based on the client's need....how I am getting paid for it is irrelevant. In fact wIthin this business established weatlh managers do a ton of work which we don't receive any compensation for of any kind.
Client has a large 401K at their work....we are expected to offer guidance on how to invest these funds and we get paid nothing for it. Client has stock options, we offer advice and receive notihing for our time. The list goes on and it is for this reason that I only accept certain types of clients that are well matched for the services that I provide. I often turn away new potential business when that match is not there.
Is there a sales aspect to this....absolutely but the sales is on the front end when the relationship is first established and I challenge you to find me any business that provides a product or service to any client that does not have this. The point I am getting at is that the days of cold calling potential clients with a product or gimmick is gone. We offer big picture financial advice and portfolio management services, which product is used, what account type is irrelevant.
I am not attacking you DickFuld but your comment saying that the job is 100% sales is just not accurate and that was my reason for responding to your post. Obviously we do not have to agree on everything but I have been doing this for 10 years so I might have a little insight on the career. Not trying to be a dick but you sound like a young kid who tried out PWM for 6 months and washed out. That being said the original question was answered so let's just leave it at that.
The problem with most people is that they feel sales is a dirty word. It should not be.
I am a random person on the Internet. You don't know if I'm in college or if I've been in this for 20+ years. If you feel my post was insulting, it was not intended to be. I happen to think that being a financial advisor is the toughest job on wall street and that most people aren't cut out for it. The failure rate is the highest for any position I have ever seen, but the lifestyle and compensation combination is the best for those who actually make it. I think that it's important that people go into it with their eyes wide open and know what they're getting into.
If you're starting out, you're not managing portfolios and making strategic investment decisions. You're cold calling or developing and working your network. There's nothing wrong with that. I think it's respectable, because you are clearly demonstrating your value to the firm by the revenue you produce. That's why they get paid so much and get such large checks to switch firms: because the value that's delivered to the firm is crystal clear. Most other financial jobs have a nebulous value to the firm because there is some (almost always unquantifiable) value to just occupying the seat. If you sell bonds to Fidelity from Morgan Stanley, it doesn't matter who sits in that seat, sales will be made. If you're a banker at Goldman, deals will be done. If you're a trader at Credit Suisse, a certain level of revenue is expected. If you're a financial advisor at Merrill Lynch, the median person will generate close to zero revenue in the first year. That's why most of these jobs pay a commission instead of a salary and bonus after the first couple of years of the training program.
Embrace the fact that you're a salesman.
Just as Investment Bankers sell their underwriting services. In the end, all business is based upon sales.
I can agree with the arguments above on both sides. Out of curiosity, sfbroker, what makes or breaks a candidate for hiring into this business? Demonstrating a sales persona & some investment acumen in the interviews? Actual experience on the resume? Aptitude test?
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