Guys, I am on the sellside right now and am kind of concerned at how my life/career is dependent on the Senior Analyst . If he gets fired/leaves , I am an “orphan” and basically the next one to own be shown the door. All that my firm has to do is to drop coverage and hire another analyst who will bring his own team What is the scenario on the buyside ? I am sure that someone has to keep tracking the stocks in the portfolio etc. so I am guessing you are not as vulnerable as on the sell side unless the portfolio is liquidated etc… What do the buysiders think ?
Wow , not one answer. I guess I should change the title to something like " buyside vs sellside" or even better “MBA vs CFA”. C’mon guys, share your thoughts on the question above . Or don’t we have any buysiders here ??
Take this for what it’s worth since I am in the middle of an MBA program and have never worked full-time on the buy-side . I am interning for a fund this summer though and I have done a bunch of informational interviews in the industry, visited a bunch of investment firms, etc. My impression is that you are correct. Buy-side positions are fairly stable. People rarely leave the industry and thus new positions don’t open up very often either. Breaking in is slightly less of a “pedigree” issue and more of a meritocracy - being in the right place at the right time; demonstrating passion for investing; etc.
I’ll add my 2 cents. Generally speaking you are correct. When the sell side coverage isn’t generating enough trading commissions or the covered industry is in hibernation deals for IPOs or M&A, banks will shut down coverage, fire analyst, etc. On the buyside, as long as the AUM doesn’t change too much analysts typically remain in their positions. A boring overvalued sector today (ie, analyst doesn’t have too much to do) could potentially be the next sector to overweight after a crash, so firms tend to keep covering (budget permitting). Also, unless you’re at a large company you’ll find that you’re the ONLY ONE covering 1 or more industries. If the firm chooses to fire you, they’ll have to find replacement and fly blind until then. Just be on the good side of the DoR or CIO, and the job should be relatively safe. I’m speaking from personal experience working at a long-only manager with long holding periods. I have no idea how the hedge funds operate.
I work on the buyside as a research analyst in an asset manager. It is definitely more stable vs a sell side as usually your the sole analyst that is responsible for certain names that you recommended to the portfolio. So typically you get fired if 1) firm is going belly up or assets are shrinking 2) your performance sucks.
Life in finance is never stable. Your life becomes less stable as you advance, though you’ll probably find more stability in a larger firm compared to a smaller one. If you highly value stability, get a gov’t job.
justin88 Wrote: ------------------------------------------------------- > Life in finance is never stable. Your life > becomes less stable as you advance, though you’ll > probably find more stability in a larger firm > compared to a smaller one. If you highly value > tranny p0rn, get a gov’t job.
It is all about performance and AUM. As long as those things remain “stable” you will be okay. The pressure comes from the fear of blowing up in a year or two. A couple years of bad performance puts the consultants on the spot and it becomes easier for them to fire you. Fortunately no issues here. At the same time, if your sector is outperforming and you are liquid, you can see dollars go out the door because, as a result of doing such a great job (beating the benchmark in an overperforming sector), guess what? The all-knowing consultants deem your allocation over-weighted and they need to grab $10 million from your portfolio. Sometimes you just cant win. Overall, I do like the job I have.
Thanks for the advice. Now , the most important part. How is the money ?? For those of you who moved from a sell-side BB ER to buyside , did your comp go up/down ?
the obvious answer is MBA vs. CFA
It’s impossible to generalize about the buyside because it’s such a big place. If you work at a mutual fund or an insurance company, or something else dusty, it’s probably stable and not that taxing. If you work at a competitive hedge fund, you could get fired for even one bad trade and generally be highly vulnerable. Your security depends on how reliant the firm is on you (i.e., you follow 10 stocks, or 100?) and your track record. At the end of the day, the buyside (unlike the sellside), is about making money on your investments. Make money, and you’re good, lose money, and you’re out.