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Getting a job in equity research can be extremely competitive.Global investment banks and boutique firms only have so many Analysts and Associates, with a limited number of new people they hire each year. In a competitive marketplace, our guide on how to get into equity research will share some ideas that will help you improve your odds of being hired.
#1 Perform your own research and analysis
The best way to get into something is to just start doing it. There is virtually no cost (other than your time) to start looking for investment ideas and performing your own valuation modeling of companies. To get the ball rolling, follow these steps:
Think of an industry or sector that you’re interested in (genuinely)
Get a list of companies in the sector from Google finance or Yahoo finance
Filter the companies down by setting criteria such as geographic location, size, the line of business, valuation, etc.
Download the three financial statements for 3-5 of the companies from EDGAR or the appropriate filing system
Put all the numbers into Excel, linkthe 3 statements, and start performing analysis
Analyze the historical results and build a forecast based on what you think the company is capable of in the future
Perform a discounted cash flow DCF analysis to value each company
#2 Get your research published on Seeking Alpha
Luckily (or not) we live in a time where it’s easy to get your content published publicly. Seeking Alpha is a crowdsourced equity research platform where anyone, regardless of their background or experience, can publish research as long as it meets their quality requirements.
In order to get your research published on Seeking Alpha follow these steps:
Develop a thesis about one of the stocks you researched in Step 1 above (i.e., stock is undervalued or overvalued due to x, y, and z)
Write a thorough report (1,000 to 2,000 words long)
Include lots of charts, graphs, and outputs from your financial model
Use lots of headings and create a well-structured article
Generate a bold title for the article the includes your “call” on the stock (i.e., Short: Online Company Inc Overvalued by 40-50%, Target Price is $X.XX per share)
If your article is not approved, take the feedback provided and keep working on your research and analysis until the report is approved
Once your equity research report is published, you now have a great reason to start contacting Analysts and Associates at companies that cover the stock (or the sector) that you wrote about. You can also use it in your application form when applying to job postings.
You can do this by following these steps:
Find job postings at global banks or boutiques that employ analysts in the sector you researched (try looking at efinancialcareers.com for postings)
In your cover letter (or cover email), include a hyperlink to the Seeking Alpha article you had published, explain your thesis, and why you appear to be correct or incorrect as time has passed since you originally wrote the piece
Showcase your financial modeling and valuation skills by including the financial model you built to support your research
Remember to take a very humble approach and explain that you did this exercise for educational purposes and have learned a lot in the process
#4 Follow up and keep networking
Networking is by far the best way to get hired (in any industry) and a major component of how to get into equity research. Networking requires a lot of persistence. If you meet resistance as you send out your emails, be sure to ask if they know anyone else who has a strong opinion on the stock you researched.
By always asking each person you talk to for a referral, you can have a continual pipeline of new people to connect with.
At the end of the day, it’s a numbers game, and the more people you connect with and share your research with, the better your odds are of getting hired.
Read CFI’s three-part series on how to network effectively!
Additional resources
Thank you for reading the CFI guide on how to get into equity research. If you follow the above steps, you will learn a lot about what it’s like to be an analyst, and hopefully, improve your chances of getting hired in a super competitive market.
To keep learning and advancing your career, these additional resources will be a big help:
Getting a job in equity research can be extremely competitive. Global investment banks and boutique firms only have so many Analysts and Associates, with a limited number of new people they hire each year.
Many professionals in this field begin with a bachelor's degree in finance or a related field. Those seeking career advancement often pursue a master's degree or a CFA designation to enhance their resume. Research assistant, junior analyst, or equity research associate are common entry-level roles.
To work in equity research, a candidate must have a bachelor's degree, preferably in a relevant business discipline such as finance, accounting, economics, or business administration.
To become an equity research analyst, you will need to earn a bachelor's degree preferably in finance or a related field, gain experience as a research associate , consider pursuing a master's degree for higher-level positions and obtain certifications such as the Chartered Financial Analyst (CFA) credential for ...
VP-level professionals earn between $200K and $300K, again with 75%+ from their base salaries. However, at smaller banks, VPs could earn below this range – something closer to the Associate compensation range is possible at the lower end.
Equity Research Associate salary in India ranges between ₹ 2.5 Lakhs to ₹ 27.0 Lakhs with an average annual salary of ₹ 12.8 Lakhs. Salary estimates are based on 823 latest salaries received from Equity Research Associates.
In a previous article on equity research recruiting, we mentioned that equity research is in decline. Headcount reductions and MiFID II – which requires banks to charge directly for research rather than “bundling it” with other products – will continue to hurt the industry.
In equity research hours are more manageable, averaging around 60 hours per week, although earnings season can entail very late nights. In equity research, an analyst bases recommendations on publicly traded information. Investment bankers work with non-public information.
Begin with a solid educational background. A bachelor's degree in finance, accounting, economics, or business administration is typically required for a career in equity research. Courses in financial modeling, corporate finance, and investment analysis are particularly valuable.
Equity Research Analysts often face periods of intense work, particularly around earnings seasons, when companies report their financial results. During these times, working late or on weekends can become more common to analyze data and update reports promptly.
Candidates must pass the Securities Industry Essentials (SIE) exam and the Series 86 and 87 exams to obtain the Research Analyst registration. For more information about the SIE and Series 86 and 87 exams, refer to FINRA Rule 1210 and FINRA Rule 1220(b)(6).
Stay Current with Market Trends: Have a solid grasp of current events and understand how they affect the markets and your sector of interest. Be ready to discuss recent news and its potential impact on the stocks you may be covering. Prepare to Pitch a Stock: You may be asked to pitch a stock during your interview.
In equity research, recruiting is more random and unstructured than in investment banking. The large banks may do some undergraduate and MBA-level recruiting, but they fill many of their spots “as needed”.
People didn't usually consider equity research before because they didn't think it was as glamorous and prestigious as investment banking. On the other hand, Investment Banking is often perceived as more prestigious, but it comes with long hours and a lot of stress.
Senior equity research analysts with 5-10 years of experience can expect to earn base salaries ranging from $150,000 to $250,000, depending on the size and prestige of the firm. On top of their base pay, they may receive substantial cash bonuses based on individual and firm performance.
Introduction: My name is Chrissy Homenick, I am a tender, funny, determined, tender, glorious, fancy, enthusiastic person who loves writing and wants to share my knowledge and understanding with you.
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