I graduated with a Master’s in Finance a couple of years ago from a non-target, and have spent the last two years in an FP&A role at an oil & gas company. I am interested in breaking into equity research, but I am not sure how difficult/possible it would be for me with my background (just hitting my mid-20’s). I have a little bit of CFA exam experience, having passed level 1.
Does anyone have any suggestions on whether or not it would be possible to break into equity research, and how to prepare for an early-career switch?
I’m sure he does want to do energy related as he’d have valuable experience there. That said, at least where I’m from, oil and gas FP&A pays more and has way better benefits/balance. And the exit opps aren’t bad either. Perhaps things are different in the States and FP&A isn’t well comped. With five years experience in my town in that line of work he would be making ~$110k +/- and a 20% bonus, with four weeks vacation and monthly flex days. 40 hour weeks 90% of the time with occassional OT. Hard to find that just entering ER. When I interviewed here for an ER spot it was $70k +30% bonus, working 60 hours per week with two weeks vacation.
I suppose I am just a bit bored with FP&A, and was looking into my career development options while I am still pretty early in my career. I didn’t specify earlier - but sell side is where I would look to break in.
But you are right about the grass always being greener, so I am just sitting back and trying to get advice from as many people as possible. I really don’t mind the hours (I put in 60 hours a week in my current role most of the time) as I am still young and without any big personal responsibilities. I’m also not making close to six figures where I’m at now (about 80k), so the money would be a bit of a factor.
Side note - I have seen a thread about this a few times, but do you all think FP&A experience would qualify for a CFA?
I can guarantee you your experience counts, it was a big part of mine! Make sure you write it up focusing on how it contributes to the decision making process. When your analysis drives whether to invest in field A versus field B, that’s the investment making process. Analysis on operational results, all of that is golden. You’re right to consider your options. If you went to ER for a bit, you could always come back. I wouldn’t count on significantly higher comp though. No one pays like oil and gas.
Whenever I listen in on conference calls, it sounds as if the ER guys talk just to make sounds. They say “congrats on the quarter” even if it was crap, ask questions that have already been answered, or in general just waste time.
I generally just read the transcript because its a better use of time than listening in.
^ The best part is they ask the questions like they’re big shots. None of them even have skin in the game because they can’t invest in what they cover. Yet they talk to an accomplished CEO like he should respect them. They don’t care about the company, just why they didn’t live up their report, which is the same as every other ER guy’s report, because no one is willing to meaningfully go against consensus. I imagine a lot of ER is managing conservative calls to consensus, trying to never stand out, all while trying to be vague enough that no one can call you on your bullshit.
Geo, my feeling is that many graduates are interested in ER because of the immediate immersion into ‘the game’. They anticipate learning from doing, not academia with the hopes of transitioning their way into money management. I want to hear from anyone on here why that is a bad idea. What you are saying makes sense, but what do you have against seeking a career in ER?
As a noob from a state school who previously wanted to do ER it’s because it’s seen as a job where hard intelligent work pays off. Although it’s tough to get into the consensus seems that it’s more about your results/reports than your prestige. The overall image of a lot of other finance roles seem to rely more heavily on prestige than ER. So people without prestige are discouraged from them and fall back to ER. It sounds stupid but I’d bet that’s 90% of the reason.
I don’t have anything against a career in ER. It pays less than other opportunities for substantially more work. OP isn’t a fresh grad, he has some experience in oil and gas FP&A, which pays better and has better balance. Being a financial exec in oil and gas > most finance jobs, other than the very cream of the crop. So I’m not sure the long term success of a high performer is really that better in ER. Now if you have zero experience coming out of school, why not give SS ER a shot. I just don’t see it as an upgrade on OPs current path. But that’s not for me to decide, if he really wants to do it, the he should. My opinion on SS analysts doesn’t mean I don’t see value in ER experience, just that most are arrogant hacks that think they’re big shit. Treasury is great experience. Being a treasurer is a fantastic position in any company. Good path if you can climb that ladder.