I have recently completed a Bachelor of Commerce with Honours in Accounting at Rhodes University with a 64% average, which is relatively decent. I also have passed by CFA level 1. The problem is within BEE South Africa, I’m finding it very hard to get a starting position?! Is it possible to go straight from varsity into an entry equity analyst position? I think I’m quite capable, I feel I could value companies with a little guidance. Or is it the norm to be in the administration side of investments before you get the chance into equity analysis?
Is it worth the time to be in the administration side? Will I use my skills and knowledge and develop them? Is it possible to start as an equity researcher direct from varsity? What’s the administration side like at a bank or an asset management firm?
It is possible to get directly into equity research right out of university - as a research associate (i.e. junior research). Companies are looking for demonstrated financial modelling and analysis skills, preferably with work experience in investment research in some capacity.
As an associate, expect to help your senior analyst out with modelling, industry analysis, comps, and industry models/databases. You will more or less be articulating your senior analysts investment thesis; however, your own opinions are usually welcomed if you can form them well!
Do you have any prior experience (e.g., internship, co-op, unpaid,etc) in research? if not, have you done any extracurricular work related to investing/ can produce something like a research/investing track-record/experience to draw from?
I have no work experience in this field, I didn’t do an internship of any sort. I have owned and traded in my own portfolio since I was 18 when I received a large amount of money from my parents. I have excellent excel skills, I am able to model, which I somtimes do in my spare time.
Write up two or three original research reports on companies that you follow or in which you own stock. Have full models to show (if requested). Tailor your research reports to suit the style of the job you are looking for. For example - buy-side research and sell-side research look very different. Get a feel for how a company writes its research reports (if possible) and get to know the lingo they use in their reports.
If your trading/portfolio management track record is good, you could develop some sort of report summarizing your performance and key trading decisions/macro plays, etc.
Generally, employers like to find out your investing style, broad sense of the macroeconomy, industries you like, and finally stocks you like in those industries. You may get some traction if you put together a portfolio of research/trading performance, which you could use to push your way into an interview.
I think former trader is saying that it can be easy to settle for a less desirable job just to pay the bills. However, if you do so, it may become difficult to switch career paths. Foe example:
Say you really want a equity research job. But after a year of job hunting, nothing comes up. So you take an accounting gig to pay the bills, and you think “hey, I might do accounting for a while”. And then when you get tired of accounting, you decide that you want to go into research but most places will offer you back-office jobs because you have the accounting experience that could help them out. (This example is drawn from experience with a previous co-worker).
100% Agree with this. It’s the same problem tons of people have. Some people even say do not exceed 3 yrs in a backoffice role or you’ll find yourself stuck. Age is against you, experience is against you.
will do