Switch from Equity Research to IBD

Hey guys

I've been offered an ER position at a BB after an internship, but IBD is where I really want to be. Unfortunately, in this market, not many people are hiring, especially not through the non-internship route (I dont have any prior banking experience either).

My first question is: Should I take the offer, and then try and make the switch internally after a couple of years, or should I keep looking until the market picks up again? The reason I ask this is because some people have told me that being in ER virtually rules out ever being able to switch to IBD.

My second question is: If I do do ER for a couple of years, will I only be able to switch to an equity issuance team in my sector (if I am able to switch at all), or are options like M $ A still open to me? I will start at the analyst level in ER.

I dont have any previous banking experience, and dont really know a lot of people in the industry. I'd be really grateful if someone here could help me out.

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Comments (116)

Nov 9, 2009 - 3:57pm

That's not a common transition. You could do it if you went to business school after 2-4 years in ER, and interviewed for IBD positions then. The BB ER experience would definitely be marketable and you could make a compelling case for the skills you have, your knowledge of the industry, and why you're a better fit for IBD.

As for whether you should take the ER job, that depends on how likely you think it is that you'd get an IBD offer at this point, and whether ER is of interest to you at all. If you know you won't like ER, then you'll be miserable in the job, probably not perform well, and be worse off than if you had declined the offer and kept interviewing.

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Nov 12, 2009 - 9:59pm

This may be a rare transition but I don't think it would be difficult at all. An ER associate with 2-3 years experience covering an industry with in depth knowledge of 30+ companies and relationships with management would seem like an ideal candidate to be an IBD associate. Of course an MBA would be a necessary stepping stone. If someone can chime in, why exactly is this move rare? Because IBD looks down on ER, because the skills/personalities are different, or because ER people generally don't seek that move?

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Jan 12, 2010 - 10:58am

Very simple answer supertight - most people don't want to make that move since they'll already be earning decent cash and won't be willing or need to make the sacrifice in terms of extra working hours to do IB.

People do make the switch though, I can think of a few ppl I know who have done it at different levels of their career from analyst level up to pretty senior lvl. If you have a few years xp then you won't need to do an MBA and can just come straight across. You can actually even make the switch later, say after 5-6 yrs when you already have solid contacts on your own stocks which would allow you to come in at the VP level where that sort of stuff matters more than most other things.

  • 3
Jan 12, 2010 - 10:59am

Transferring from ER to Investment Banking (Originally Posted: 03/16/2011)

Hi,

What are the chances of moving from Equity Research to Investment Banking? Is this transfer frequented? And, what positions would you typically look for when transferring into Investment Banking?

Thanks,

Jan 12, 2010 - 11:07am

Equity Research to --> IBD Analyst (Originally Posted: 10/04/2011)

Hello Primates,

I did a search and didn't see any pertinent results. So I've been trying somewhat unsucessfully for the past month or two to apply directly to boutique and MM analyst positions coming from a large mutual fund company with 1-year work experience.

I haven't had much success as they are looking primarily for 2nd-year analysts that already have a sound knowledge base in valuation, modeling and financial reporting and analysis. Positions are also very limited.

I am seeing a lot more openings in NYC and Boston (and even Philly) for Equity Research Associates either right out of undergrad or with 1-2 years experience. I just passed Level I of the CFA in June which more closely aligns with ER anyway.

What do you think the prospects are of doing ER for a year or two, learning the valuation and modeling skills and trying to lateral in at your company or moving to another bank for a 2nd-year analyst type positon? Or perhaps going from ER --> MBA --> IB Associate?

I'm just trying to explore all of my possibilities for breaking in, and with my background and experience I'm thinking it may be easier to go ER route then to keep prodding away at boutique analyst openings where they really want 2nd-years anyway.

Feedback appreciated,

John

My name is Nicky, but you can call me Dre.
  • 2
Jan 12, 2010 - 11:21am

ER to IBD - How difficult is the transition? (Originally Posted: 11/24/2007)

Was wondering about how difficult it would be to transfer from equity research in a top tier BB into IBD…

Given that it will be difficult to network within the firm (due to the Chinese wall) would it be best to try to make the move within the firm or apply to other firms?

After how long should I start applying? If I were to apply after 1 year in ER would I come in as a 1st year analyst?What other divisions in the firm do you think are most relevant in terms of skill set to investment banking?

Jan 12, 2010 - 11:23am

Summer ER to FT IBD? (Originally Posted: 10/06/2014)

Hi

I have received an offer for a FT position at a BB (GS/MS/JPM) as an Equity Research Analyst following my summer internship this year. However, I have realized that what I actually want to do is IBD. I am currently recruiting for FT positions but, I was wondering, if I should instead (for those applications I haven´t submitted yet) apply for summer internships?

Also, would you recommend maybe applying to both summer and FT at the same bank?

Note this is for London.

My profile is smth like this:
Top grades from top European school; summer internship at a BB; internship at a small equities fund the previous summer; 3 languages and strong extracurricular.

Not sure how to approach this –would vm appreciate some help!

Thanks!

Jan 12, 2010 - 11:30am

ER to IBD Early? (Originally Posted: 09/16/2015)

I've seen a couple posts on this topic, but they are either old (2009) or apply to post-MBA grads.

I want to know if it is possible to switch within the 2-3 years out of undergrad at a MM size bank? And if so, would the transition be easier for certain coverage/product groups?

This is assuming I do well during my time in ER, as I already have a good number of connections in different IBD groups.

Thanks.

"There's always money in the banana stand" - George Bluth Sr.
  • 1
Jan 12, 2010 - 11:38am

ER to IBD - Two job offers (Originally Posted: 05/17/2011)

I recently have two job offers, both very good banks. I have just graduated from a generally non-target school. One bank is FIG and I would have the insurance sector as my coverage(property & casualty).

My main question is if it is difficult to move into M&A after working as an equity research analyst? Is a top business school after a few years a wise decisions if I choose this path?

I am new to this site so this is probably in the wrong forum, but thats alright.

Jan 12, 2010 - 11:40am

Equity research to IBD (Originally Posted: 06/26/2011)

Is it possible to lateral out of an Equity Research Intern position to an FT role in IBD ( M&A)? And does Equity Research come under IBD?

GS, BX. Will work for prestige.
Jan 12, 2010 - 11:42am

ER to IB: analyst or associate? (Originally Posted: 10/08/2013)

Hi all,

Long time reader, looking to make a switch. Currently wrapping up my second year in ER, and expecting to complete level 3 of CFA in June. If I wait until I have 3 years of ER experience, what position could I transfer into IB? 3rd year analyst? associate? Thanks for any and all input.

(Yes, I understand that CFA has limited to no weight/application in IB)

Jan 12, 2010 - 11:55am

equity research to IB ....easy shortcut?? (Originally Posted: 04/15/2010)

I've met two guys both managing directors who started in equity research and transitioned into IB as associates.

This really makes me think. Isn't it better just to go into equity research and skip the grunt years of IB, and then transition into IB as an associate when the hours start to get good, and the pay starts to get really good? While equity research is no piece of cake, I think that it still gives you respectable experience, and relatively good pay, and people in ER tend not to be as asshole-ish.... and then later down the road move into IB as a associate/senior-associate, thus skipping the worst part of the IB ladder.
....is there something terribly wrong/impossible about this strategy?? does this type of transition only happen back in the good old days ???

Best Response
Jan 12, 2010 - 12:00pm

From Research To Banking (Originally Posted: 09/13/2014)

I have roughly two and a half years of experience in equity research, currently at a small sell side boutique. I'd really like to get into IBD somewhere, my first guess is BB is out of the question (non-target but i do have a MS in finance). Although I know I'd need to learn a lot of new things, I think the ER experience gives me at least a decent chance because I know how to model and analyze companies and can pick up on on the other side of the wall quickly. My reason for wanting to transition is to open more doors for my career. It's become very apparent to me over the past couple years that IB absolutely garners more respect on a resume than ER and I still think I'd find the work interesting and enjoy it. If anyone has done this, knows companies that recruit from research at least time to time, or has any other advice I'd appreciate it a lot. Thanks in advance.

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Jan 12, 2010 - 12:05pm

ER to IB advice (Originally Posted: 01/20/2014)

I'm currently undergoing a spring internship as an equity research analyst for a MM firm in Houston, but think my interests are more aligned with investment banking. Just to give a little bit of a background, I earned this internship through a program at my school in which I will complete three internships prior to graduating. The majority of the internships offered through the program by the 30+ board member companies are energy trading focused, and my ER internship is one of the few that is not. It was fortunate I received this internship opportunity because, as my academic career has progressed, I find myself less interested in trading and more interested in banking. In this program, students have very little say in where they go and are "auctioned off" to the highest bidding board member company. The only way for a student to indicate his interest is to rank board member companies by preference in a survey that many of the board member companies seem to completely disregard. That being said, since ER and IB are closely related, I picked as my first preference (and was fortunate to get) the firm offering the spring ER internship. Is there a way to express interest in the investment banking side of things without coming across as ungrateful for the ER opportunity? I'm scheduled to finish my undergraduate degree this fall (December 2014), and landing an IB internship is out of the question due to my third internship filling this coming summer's time slot. In a perfect world, upon graduating I'd enjoy a chance to work FT with the IB side of the same firm I'm interning. Any advice would be greatly appreciated.

Jan 12, 2010 - 12:16pm

From Research to Banking, possible? easy? (Originally Posted: 05/31/2011)

Hello,

I was wondering what the probability is of switching between the research department and the banking department in an i-bank. I have an offer for an internship as a research associate at a great firm focusing on a great industry. The internship will lead to a full time position. The problem is I don't want to do research as my career. I want to work on actual deals.

My logic for accepting this position is that I can learn a great deal about the industry and then switch over to the banking side after a year or so either with the same firm or a different firm.

Would I be better off waiting to accept an internship where I work on a live deal (even if the company isn't known) or should I accept the research position? Basically, will it be detrimental to getting a position on the banking side? I'm curious as to the experience of people about the switch between research and banking. Is research looked down upon? Is deal experience important?

Thanks!

Jan 12, 2010 - 12:22pm

Why would you want to do IBD after 2 years of research? Just start networking now and get in asap.

speed boost blaze
Jan 12, 2010 - 12:25pm

ER -> IBD (Originally Posted: 09/25/2009)

I just finished equity research internship at top 5 BB IB with a positive feedback but I'm determined to go for IBD full-time position. What are my chances for the graduate offer ?

Jan 12, 2010 - 12:26pm

Much better than if you hadn't had ER experience. You can tell a more compelling story about why you know IBD is a better fit for you given your ER experience...what you enjoyed most about the job was a,b,c which are key to IBD. You can talk about the time you spent talking with bankers.

In terms of pecking order, you sit behind the folks who had IB internships, but ahead S&T interns and anyone without Wall Street internship experience. Since you got an ER offer, I assume you have a pretty good resume, so it will be up to networking and interview execution.

Capitalize on your ER relationships to get intros to people in banking who after talking to you, would be willing to shoot an email to the right people saying they'd spoken to you and you're someone they should watch out for in the interview process. Think broadly about the types of people who could be helpful with a simple email. Here are a few ideas:
The Email Introductions Most Likely to Open Doors - http://bit.ly/Uho6F

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Jan 12, 2010 - 12:28pm

youd be fairly competitive as lots of people wont have any good relevant experience this summer. granted a lot of this hinges on there actually being FT IB positions available

Jan 12, 2010 - 12:32pm

Equity Research SA --> IBD FT (Originally Posted: 06/08/2013)

Hey, I am currently a rising senior doing an equity research internship. I am interested though more in IBD M&A and was wondering how I could market/transition myself when networking/interviewing for FT positions? As in, if they ask why SA ER to IBD full time, what are some good answers?

Jan 12, 2010 - 12:33pm

Your work in the two roles as an analyst will have a lot of similarities, but you should probably say that you wanted to work more in the deal-making process (as in, that's where your strengths are) than in the research side. I was in a research-esque position this past summer and in my interviews for FT IBD I talk a lot about how I feel my strengths as a negotiator and sociable person makes me more suited for i-banking than research.

"Yes. Money has been a little bit tight lately, but at the end of my life, when I'm sitting on my yacht, am I gonna be thinking about how much money I have? No. I'm gonna be thinking about how many friends I have and my children and my comedy albums."
  • 1
Jan 12, 2010 - 12:34pm

ER Intern -> IBD Coverage Group SA - Viable Path? (Originally Posted: 08/19/2012)

Is it generally a good experience to have a research internship covering the a specific industry before applying for IBD SA positions? It seems to me as if not many people follow this path. Or would that actually be too specialized?

I would assume generally any ER internship would give interns some solid modeling skills, etc.

Ex. HC ER Internship -> IBD HC Group SA

Jan 12, 2010 - 12:35pm

When I'm looking at resumes, I basically flag all resumes that have some demonstrated interest in finance, so yes, an ER internship would most likely get you some looks when applying for IBD roles. Obviously not quite as directly applicable as if you'd done IBD previously, but still a good experience and should position you pretty well.

It also partly depends on the firm you're with too, but in general, that sounds like a good path. Also note that just because you did research in X industry doesn't mean you HAVE to say that X is the only industry you're interested in.

Jan 12, 2010 - 12:37pm

why switch from equity research to investment banking? (Originally Posted: 10/02/2013)

I'm currently formatting my story for an ib interview tomorrow. I first interned in institutional sales and then the summer after I interned in equity research. I can't think of a particularly GREAT reason for the "why IB" question which will inevitably come up during the interview. So far I have "I wanted to be exposed to working on capital raising and M&A which I believe will allow me to learn how a transaction is done and how deals are negotiated."

Anything else anyone want to add?

Jan 12, 2010 - 12:39pm

Often a good answer (or part of an answer) to "Why IB?" is that you want to work in a fast-paced environment with smart, motivated individuals so that you can be constantly challenged and learn life-skills from your peers and superiors.

It's cliche but it should probably be the case for anyone interviewing for IB.

Jan 12, 2010 - 12:40pm

Because you want to do deals not write about them?

This to all my hatin' folks seeing me getting guac right now..
Jan 12, 2010 - 12:42pm

from institutional sales and equity research to IB (Originally Posted: 10/01/2013)

I had 2 previous internships, one in IS and one in ER. How can I spin my experiences into transitioning to IB full time? I usually get asked why IB vs. ER and I usually don't have the best answer.

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