Tips to prepare for fundamental equity L/S Analyst
I am hoping to apply for and interview for some fundamental equity l/s shops in the coming months. I am quite junior with no major investing or modelling experience.
In terms of preparing myself for interviews and to build strong foundations for a good junior analyst, I was thinking of doing a modelling course (e.g. Breaking into wall street or Training the street, etc.), as well as reading security analysis by Benjamin Graham.
Given that I have 4/5 months before interviewing, is there anything else I should be doing, focusing on, or reading in order to standout as a junior analyst.
Any advice or input is very much appreciated.
Comment to avoid post glitching.
No need to read security analysis, I'd use that time to research a few stocks that you find interesting. Have at least 1-2 stocks in your PA (create one if you haven't already) and be ready to discuss your thesis.
Thank you for the input. Why don't you suggest reading security analysis?
Given that I have quite a bit of time, are there any resources you would recommend I use in order to learn how to research a stock in detail in order to prepare a differentiated thesis?
b/c ben graham buying shit trading below conservative estimate of book value doesn't work anymore since those companies are usually bleeding assets fast, market is much more efficient today
also "book value" far more nebulous today wrt IP and trademark assets
also value factor underperforming = even if you find a stable assessable book value, stock could trade below that for quite some time
also, no one at funds worth working for rlly cares abt your net net ideas today for the above reasons
finally, investing books have rapidly diminishing returns on time spent vs actually researching and learning industries/names esp for getting an internship
if you must read, read margin of safety and soros's book, the rest aren't really necessary
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Learn python
I have quite a strong technical skillset in python and other languages as I come from a STEM background (hence, the lack of finance and investing experience). Out of interest, what use would python be in the fundamental L/S equity space (i.e. what sort of tasks would analysts undertake using python)? Is there anything in particular that I should practice doing in python to prepare me for some of the tasks fundamental L/S equity analysts undertake.
Or are there any side projects that you recommend I do using python over the next couple of months to showcase my skills and utility when applying/interviewing for these roles?
Thanks!!
With the advent of the sexy "quantamental" [quant + fundamental] roles out there now python and C# can be extremely helpful to make you an attractive candidate. Look up stock selection models and you can see how python is used there as a quick example
If you're aiming for pure fundamental roles than all you need to know are the basic python libraries like numpy, pandas scikit-learn and even having this knowledge is a huge plus and not needed you're expected to just be very advanced with excel and understand how macros work.
This advice is off-base. I don't know a single fundamental analyst role at a scaled fund where knowing Python libraries would be considered a "huge plus." In fact, it's adeptness with Excel macros that would be considered a "huge plus." And with that, most L/S equity HF models are not complicated enough to require macro scripting. Assuming your title is accurate (first-year banking analyst), you are either guessing, or you're going off of second/thirdhand hearsay.
And sure, I can imagine a world where you are working for a two-person hedge fund and want to do a web scrape to collect some information. But crawling and scraping frameworks are quite different from sklearn. What projects do you think fundamental equity analysts are using Python for?
Learn C#? That's not even useful for a quantamental role. You really wouldn't want to do data science in a language like Java or C#. That's really going to be used for pure infrastructure projects (think trading systems, internal application servers).
Don't mean to hijack the thread OP but could those experienced please also recommend books / resources on learning how to generate ideas? Is the right approach here to become very familiar with an industry / set of companies and evaluate from there? What are the best tools / resources to learn how to screen for and model different ideas? Really trying to understand what interviewers are seeking in stock pitches / how original ideas come about. Great thread, thanks very much OP and all who have responded. Very helpful
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