To all the elitists out there (warning: long)

I'm writing on this forum, as I am in many other places on the internet, to gather some opinions concerning my present day situation. I do not expect any definitive answers from this forum, but any thoughts will be appreciated. I especially want all you finance elitists out there to both pick me and my situation apart, as I assume any good stock picker would when viewing a potential investment. I'll try to keep this as short as possible but I do need to include a good amount of information to get my overall point across so without further ado...

I'm 23 years old and I am a Canadian citizen. I am lucky enough to have the opportunity to obtain American citizenship as my father has recently married an American. I've realized that equity research is where I want to be so 3 weeks ago I packed my bags, quit my job and left Canada. I'm now in sunny AZ with my father, I have a green card and I envy voters in the next coming election. One day I will have the power to vote here.. I figure what better place to do ER than the U.S.

I've been obsessed with the stock market ever since my last job and I've discovered I have a natural ability to pick winning stocks. I realized this while at my last job in Vancouver. For the past year I've been working as a research analyst for a medical intelligence company. I wrote three reports for them that detailed one of the largest segments of the medical device market. I wrote over 1300 pages for them, created over 750 forecast models, and conducted a sh**load of interviews, surveys, read countless sec filings, etc. I conducted interviews in 21 countries. It was exhausting because the company was small and lacked many resources Iâ€m sure people in ER take for granted, plus it did not pay well but I knew the work I was putting in was superb. Johnson and Johnson bought all my reports and said they were the most accurate they had seen in recent years. I even did some consulting work for Abbott laboratories on a new venture project they were considering, they wanted to know whether or not it could make money so they asked me.

Now the research I did was not entirely financial research, I was not paid to analyze stocks, but I analyzed products and market trends. Before I took this job I didn't really know much about the stock market but the head analyst at the firm did. He had a CFA and he introduced me to the world of investing. Needless to say I became hooked, so much that I can't get enough of it, it keeps me up at night and I dream about it.

I went out and read many books on investing, Lynch, Buffet, Damodaran, Graham, etc. Confident, I decided to enter the market. The head analyst told me I would fail and that I was naive and that people like me are delusional. I decided not to listen to him and pissed as I was about his attitude, I instigated a contest to see who would be the better stock picker. He felt I lacked the education necessary to succeed in stock picking. He had devised a short strategy on Chinese securities and several medical device companies he felt had inferior products the market would realize. Personally, I thought his strategy was convoluted. I choose rather to simply invest in obscure unfashionable monopolies and companies with little competition in emerging markets. Companies with businesses so simple, their revenue would remain unchanged during recessions. I thought to hell with medical devices, who can predict what will happen with them anyways? Well, since then 6 months ago I've more than doubled my money on 2 stocks and overall my portfolio return has been 50% on a total of 6 holdings. Each one has made money and the percentages are as of last Friday.

As for the other analyst? Well he has only lost money, all his fancy macroeconomic theory and evaluations didn't mean sh*t. I felt common sense and strong business acumen is the primary trait you need. I'm not discrediting his CFA education though, but my take on the CFA is that it isn't the keys to the Ferrari, but rather really good tires.

I decided I didn't want to work for that company anymore, as I don't like being around whiny negative people. I want to apply all the research skills I've honed to find value in companies and decide how to apply that knowledge in the stock market. I'm extremely passionate about this area and it's all I think about. I just wish I knew about it earlier. Since my last job I have been actively managing a 10K private fund financed through friends and family.

My question to all the members of this forum is this:

What are my odds of getting into ER at a reputable firm on Wall Street? How close am I to realizing that goal?

I did not go to an 'Ivy league' school as I ruined my chances early in high school, but I do think I am just as intelligent and determined now as most Ivy grads. I attribute my early academic short comings to my mother as she nearly died from a rare brain hemorrhage. She eventually recovered, however, for 2 years she did not know who I was and she has had to relearn everything. It's hard to have your life straight when you (Dad is always out working - salesman) are in charge of that kind of responsibility. That experience did mess me up during high school unfortunately. I now feel as if I'm just finally discovering myself and my passion but then again, I have always been a late bloomer.

I did go to a great school though, the University of British Columbia. The school ranks 27th in the world according to Newsweek and 2nd in Canada. I graduated with a B.Sc. in Astrophysics in 2006. I got out of physics because academia was not for me, but it was wonderful to help discover planets (UBC has the only space telescope next to NASA). I got decent marks, a 3.4 GPA overall GPA. It was higher in the beginning (1st year 3.9) but it dropped during 2nd and 3rd year as I was busy running a radio show and a local business to generate cash for school and living. I did quite well in my last year however and I was employed as a geophysicist for a mining company before I got the research gig.

So that is the skinny on me right now. Ex-medical device industrial researcher and recent grad with relevant work experience looking to take Wall Street by storm. Am I delusional or crazy enough to make a mark?

I'm serious about the mark by the way, I feel the most important thing I can do right now is get into ER at a BB. And I'll admit it's for the name. It is my dream to start a small financial firm in British Columbia when I am older. I want my place to be the key for a happy retirement of many locals there as it will be a retirement resort in the future. I just want to say I started my career at X, (not sure how much that really matters for stock picking) because it gives the layman investor confidence, which is what you want in a successful business.

So am I dreaming? For the last week I have been applying to firms like crazy. I plan to get at the recruiters this next week.

I'd appreciate any leads.

 
Best Response

You're dreaming.

I have never read such a rambling, incoherent piece of writing in all my life. Do you realise that in ER you have to write reports that people actually READ?

What's more, your defensive attitude doesn't help. Why give an excuse to a question nobody has asked? If you have been out in the workforce, who cares about your GPA or highschool?

An obvious question that is going to come up: why/how did you leave your last job? You insinuate that you left. Were you fired? Will you get a reference?

My advice? Tough it out, get an MBA or maybe CFA to show your skills, then think about it. At least CFA can be done while in a job then lateral into ER.

 

I quote..."For the past year.....I wrote three reports for them that detailed one of the largest segments of the medical device market. I wrote over 1300 pages for them, created over 750 forecast models, and conducted a sh**load of interviews, surveys, read countless sec filings, etc. I conducted interviews in 21 countries"....I call BULLSHIT! What, did you make 3 models a day? You obviously have no idea what an ER model looks like. If you handed me a 1300 page ER report, I'd fire you!

 

Wow...I just read that post again. It gets crazier every time I read it. Sounds like you've read one too many copies of Jim Cramer's "Confession's of a Street Addict". What you fail to understand, is that one of the most important traits for being a successfull equity analyst is credibility...and I'm sorry to say, you have none! Analysts look at time frames 3-5 years out, come back to this board with your portfolio returns then. 6 months? What a joke.

 

What the fuck is this? No way I'm gonna read all that bullshit. Just tell us what your current qualifications are, and tell us what job you're trying to get to.

_______________________________________ http://www.drmarkklein.blogspot.com/
 

Thanks everyone for your comments keep them coming. Here are some replies I have

"I have never read such a rambling, incoherent piece of writing in all my life. Do you realise that in ER you have to write reports that people actually READ?"

Yes I know what people do in ER that is not my question. I'm sorry if my rambling bothered you but I did vent my situation and frustration because I can thanks to the anonymity of internet. This is my situation and I'm trying to change it. I'm not proud of it and I'm worried because I'm trying to straighten my life out into something I have never been in. Now would I act this way around other ER people in real life? Of course not.

"What's more, your defensive attitude doesn't help. Why give an excuse to a question nobody has asked? If you have been out in the workforce, who cares about your GPA or highschool?"

See above, I was ranting I realize it doesn't matter

"An obvious question that is going to come up: why/how did you leave your last job? You insinuate that you left. Were you fired? Will you get a reference"

Yes I can get a reference. I left because I wanted to move to the United States and get into ER. I was incredibly busy at that job, working 70 hours, I needed time to focus in and educate myself on ER and more importantly, more time to apply for jobs. I wasn't happy, so I quit, I'll be happy in ER.

"I call BULLSHIT! What, did you make 3 models a day? You obviously have no idea what an ER model looks like. If you handed me a 1300 page ER report, I'd fire you!"

Yes I did actually and on some days maybe more however I was not making an ER report, I was in a completely different field. I know what a ER report is and I certainly wouldn't write a 1300 page report that's ridiculous. My point basically is that I can get shit done and my last job proves that.

"Wow...I just read that post again. It gets crazier every time I read it. Sounds like you've read one too many copies of Jim Cramer's "Confession's of a Street Addict". What you fail to understand, is that one of the most important traits for being a successfull equity analyst is credibility...and I'm sorry to say, you have none! Analysts look at time frames 3-5 years out, come back to this board with your portfolio returns then. 6 months? What a joke."

What are you talking about? I had fortune 500 companies base their product decisions on what I knew about the market. 2 months ago I was on the phone with the head of business development of Abbott, a man who lives in the bahamas. I was telling him which industries I thought would be huge and guess what, things have turned out as I have predicted. I wasn't conducting ER but I knew which products had a future and which ones didn't and that is valuable to ER. I realize I have a long way to go but you don't need to remind me that investment time frames are 3-5 years, I agree with you that they should be but I just got into the market 6 months ago and I think I am doing alright for someone who didn't know anything about the stock market 8 months ago. I've never read Jim Cramer in my life nor do I watch his ridiculous show, please don't compare him to me just because my situation seems unreal. As far as I'm concerned he has more money than you do and has a better life even if he is sort of a scam.

I appreciate the comments folks, I'm getting a better understanding of how people's brains are in this industry

I think bluefinancer said it best

 

Look dude, wrap your head around what ER people do. Then at least make an attempt to write in a similar style, ie keep it short and relevant.

If you really have the background you say you do, your best bet is try to get hired by an analyst covering med device. Those people usually appreciate industry background and market knowledge. Since you're probably gonna end up being an experienced hire, you should be looking at headhunters and getting references from the companies you've worked with, ie introductions to Wall Street analysts from the company's IR department, etc.

And also, keep in mind research is different from portfolio management or investment management.

 

I'm going to start a new thread in the 'get a job' section that will be a concise version of what was said here.

I'd appreciate if everyone here could take a look at it.

"Equity research advice and career path" is the name of the thread

 

ok,

I'm in ER at a top boutique.

While your industry experience sounds interesting, you are somewhat irrationally defensive and to be honest, no one cares about your life story.

Furthermore, your modelling work sounds close to irrelevant. I mess around with one model for each stock, each of which is incredibly detailed. I have a few extras lying around for things like operational leverage and LBO stuff, but your 750 models sounds ridiculous.

Also, you need to learn how to write - usually that is a test for most ER people - and your writing comes off as rambling and is incredibly long.

Ultimately, it's because you're overselling yourself and you are likely to get burned b/c a banker will call you out on all of your 'supposed' achievements.

I suggest toning it down, reassessing your actual skills as they pertain to finance and ER and then maybe improving your writing. You're not out of the woods, but I'm pretty sure you'd get completely owned in an interview.

 

I appreciate your thoughts Ratul.

There is no sense comparing the models I made for my last job as they weren't financial models. Most of them were very simple.

I've decided to create my own research report over the next week or two. I would like to invite anyone here to critique it once it is finished.

I feel if I get my feet wet on my own accord and show my work to the right people it might help my cause.

 

I've heard of people doing this as a way into ER from a non-traditional background, but I'm not sure of the point. Any model you have likely won't have a good cash-flow, balance sheet or income statement, or any semblance of how to make effective projections for that matter.

Ultimately, you're again, overselling skills you don't have. Tonnes of normal researchers want to come into ER, assuming in some way its similar. I think we do a lot more equity analysis than equity research. Anyway, best of luck man - it's a tough business to get into, but it's pretty awesome.

 

Well so far thanks for the comments

As some of you know, I'm currently working on a research report. I know some may think there is no point but my point is not necessarily to show banks I am as good a their ER department, but moreover, that I am at best trainable and can go further when around the right people.

The ETA on the report is next Friday. I'm including some basic DCF and relative valuation models, with some of my own as well. I've educated myself this week on these areas by reading old reports and by 'attending' (haha) video lectures from MBA courses.

For example...

http://pages.stern.nyu.edu/~adamodar/ has been decent so far, I've completed about 70% of his MBA course on valuation. I also have his book 'investment valuation' and it's helpful. Sure beats paying over 100,000$ to listen to him talk, haha the internet rules.

So I'm going to post a link this next Friday to my report so I'd appreciate some feedback on it

In the meantime, any sites or books you guys could recommend?

 

dude, you are getting a bit creepy with all of this. Instead of spending your time trying to show people on a forum that you're worthy of an ER job, why don't you spend it networking-- that's what is likely to get you the job. With exercises like this, you make yourself hard to pull for and open yourself up to people looking to poke holes in your "experience" and "models." Just trying to help.

 

He's probably CFA'ing a girl in the poop pipes on a board room table at 85 Broad this very second, crying tears of love and hatred all at once because he has realized the American dream. Little does he know GS just decided to cut back 99.99% of its medical ER group...good luck, buddy!

Kidding, would be interested to hear how this story ended up too.

 

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