Types of Investment Professionals (What Are The Different
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Transcript Types of Investment Professionals (What Are The Different
Types of Investment Professionals
(What Are The Different Job Opportunities?)
Sell Side Firm (Creates And Sells Proprietary/Primary Research)
Clients are institutional investors (Hedge fund, Mutual funds,
Pension funds)
What are the different job opportunities?
Research
Sales
Trading
Investment Banking
Corporate Finance
Compliance
Back office/Other
Types of Investment Professionals
(What Are The Different Job Opportunities?)
Buy Side Firm (Buys And Uses Primary Research To Manage Investments)
Research analyst clients are internal PM, Private/High net worth managers,
and Brokers
Portfolio manager clients are usually individual investors in mutual funds,
corporate accounts or high net worth individuals
What are the different job opportunities?
Research
Trading
Portfolio Manager
Sales
Compliance
Back office/Other
Who Are Your Clients As A Sell Side Analyst?
(What Are They Like?)
Mutual Funds (Pain In Butt On Payment And Feedback)
Concerned about consultants, compliance, etc.
Long only
Closet indexers
Must own something
Herd mentality
Slow investment process with multiple committees
Pension Funds (Limited Dealings With)
Liability matching
Asset allocation
Hedge Funds (Quick Feedback And Payment Or Termination)
How do I make money, period
Timeframe
Types
What Do Clients Want From Sell Side Research?
(What Will Get You Paid?)
Highly Valued
Independent survey/research
Independent thought
Unique company or industry insights
Access to management/ Industry conferences
Knowledge of individual companies and industries
Responsive to clients needs
Medium Value
Specific investment idea
Quality of earnings estimates
Low Value
Sales Coverage
Portfolio Advice
Ratings/Stock opinion
Valuation
Skill Sets Of A Sell Side Analyst
(What Do I Need To Be Able To Do To Succeed?)
Quantitative (Bernstein)
Financial
Accounting
Technical
Qualitative (Alethia)
Ability to change on the fly (My first meeting)
Detective (Mosaic Theory)
Problem Solving
Time Management
Presentation/Marketing
Industry Knowledge
Personable
Psych
What Is The Life Of A Sell Side Analyst Like
(It Revolves Around Earnings Season)
30 -50% Travel/Client Calls
On the road 8+ days a month
Comes in bunches
Research travel
Customer meetings
20-40% Writing/Models
Maintenance research (Useless! Everyone does it. No one pays for it)
Initiation reports (What gets you in the door)
Actionable research
20-40% Research (What You Get Paid For)
Actionable research (Find a Change)
Stock Picking (Why ratings are garbage)
Modeling
Valuation
10-20% Management, Compliance, etc.
How Do You Succeed As A Sell Side analyst
(You Must Add Value)
Be Right On Your Research
50% is considered good
Be Early/First With Your Research
Have 100’s of people calling on them
Only pay top 3 (60% to 1st, 30% to 2nd, 10% to rest)
Be Actionable And Make Them Money Based On Your Research
Find confirm Success/Failure with strategic roadmap or strategic initiatives
Independent Thought - Staying Away From The Herd And Group Think
Presenting the contra case.
Taking a stand/being accountable
Things to remember at clients
They can’t trail for long. People will pull money
Outside influences (issue with Ivy league fund and Enron)
They are swamped with research
A large percentage of them are inexperienced
How Do You Get Paid?
(Both The Company And The Individual)
Sell Side
Firm
Research
Sales
Trading
Buy Side
Research
Portfolio manager
Sales
Trading
Why Do Clients Pay Me?
Information based on fundamental research
Find the change to with strategic roadmap or strategic initiatives
Customer, Competitor and end market surveys
Contacts in industry
Why is this important?
How Did You Get Involved In This Field
(High Risk. High Reward)
Sell Side
Wall Street
Regional
Non traditional
Buy Side
Research
Trading
Portfolio management
Interview Advice
(What You Need To Do At A Minimum)
Know something about the company you are interviewing with
Show that you can add value.
Show that you can think on your feet.
Show that you can solve problems.
Convince me that I want to work with you in a high stress, high pressure
situation for an extended period of time.
Don’t lie (especially on something I can check on)