Advice on a Career in Securities Research

Hello All,

I will start with a little background on myself. I am from a midwestern state and went to a local university that wasn’t incredibly special but ranks about top 100 in the US. I studied economics, became SAS base level certified, and was focused in doing work in data analytics for one of the Fed offices or something similar. My GPA was about 3.4 overall - primarily due to one really bad semester.

Coming out of school I ended up taking on a passion project helping a local businessman open a nice restaurant. My focus was on hiring, procurement of product, marketing, etc. I was being compensated much more than I would have been doing most other jobs and was having a great time. However, I knew that the late hours and type of work wasn’t going to be a long term engagement. I started to look for other jobs similar to the ones that I had intended while in school but wasn’t having any luck.

Therefore, I decided to pursue an MBA as a way to break into a more stable career with better long-term prospects. I scored in the high 600’s on the GMAT which was fine because I wasn’t targeting a top 10 school. I applied to many schools in the top 20 - 30 but also applied to my alma mater per a request from my girlfriend who was interested in moving back to that town. My alma mater at the time ranked just in the top 50. After interviewing with many schools and getting some acceptance offers my alma mater gave me an offer that piqued my interest - all tuition paid. To consult on my decision I reached out to a mentor of mine who had worked for Price Waterhouse for decades and had hired numerous MBA grads. His take was that outside the top 10 MBA programs the differentiation isn’t great and that cost should be a larger factor in my decision making.

Therefore, I decided to go back to my alma mater and pursue possibly getting a career in corporate finance post MBA. In my first year I took a course on equity valuation and absolutely loved the process so I involved myself in everything that I could in equity valuation. I took over as portfolio manager of the student managed portion of the university endowment fund, I entered into a local equity valuation competition and won. I took CFA level 1 and 2 and passed both.

Post MBA, however, I was blown away by how hard it was to get even a low level job in equity research. I was scheduling meetings with people and traveling to other states just to have coffee. I was willing to take less money, etc. but nothing was panning out. My career services advisor said that doing a job as an investment advisor would be a potential inroad and she put me in contact with someone from a discount brokerage firm who was hiring a financial consultant. At first I was extremely reluctant to do the job because I had heard horror stories about working in financial sales. After speaking with the recruiter he assured me that this role was different. He said that I would become series 66 licensed and that my job would be focused on solely taking meetings with clients and assisting them in finding a managed portfolio that would be right for them. Also, the pay was purported to be much higher than I was expecting to get as an analyst.

After doing the job for the past 2 years the pay is close to what they claimed. I have made about six figures a year over the past few years with the company but I hate the job. It isn’t just advising clients, it is sales, plain and simple. I have to go to sales practice meetings. I have to listen to my phone calls with clients with management to address my salesmanship. One story in particular that really turned me off the whole thing is about a client who was newly retired and in his 60’s, his wife was only expected to live a few more years. I assisted the man in rolling over both his and his wife’s old 401ks and investing them in conservative portfolios. The man had informed me that a larger amount of their wealth was in some variable annuities that were recently sold to them. The annuities had some moderately large surrender charges so I decided to leave them alone. One day when I was out to lunch the man came in to the office to drop off paperwork. He met my manager and told him how much he enjoyed working with me. In their conversation he also mentioned the annuities that he regretted getting into because he like the experience with me much more. When I got back from lunch my boss said that I should call the man and schedule an appointment to talk more about the annuity. I said that I had covered this with the client that there was a large surrender charge and that it wasn’t likely in the man’s best interested to take the charge just to get into a conservative portfolio. The client agreed at the time. My manager insisted that I do it but I just ignored his request.

In a conversation with a colleague I said that I despised the sales practices and wanted out of this part of the industry. To my chagrin this person informed another colleague who informed my regional manager. After several meetings on my ‘sales aptitude’ I was let go from the company about 6 months ago. I wasn’t particularly distressed about it at the time because I really didn’t enjoy it. However, I have applied to probably 400 jobs in equity research, fixed income research, corporate treasury, etc. and have had only 5 interviews, of which none have worked out. I am sitting for CFA level 3 this weekend and am wondering if I have a future in finance at all. Any thoughts or perspectives would be much appreciated!

Tanks for sharing the story, but I don’t know what comments would be helpful. It is hard to break into a new role, and you’re not an obvious fit for the jobs you are looking for, as you probably realized. The only constructive thing I can say is to broaden your search, and even consider doing something not in finance altogether. Even if you get into equity research or something, it will probably be a low tier job that no one with direct experience wanted.

I would take a look at the following link and then decide where to go from there.

Link:

Thank you for your reply. What elements could I add to my resume that you think would make me more of an ‘obvious fit’? Also, do you think that it is likely that the effort I have contributed towards passing the CFA exams may ultimately be worthless?

“One day when I was out to lunch the man came in to the office to drop off paperwork. He met my manager and told him how much he enjoyed working with me. In their conversation he also mentioned the annuities that he regretted getting into because he like the experience with me much more. When I got back from lunch my boss said that I should call the man and schedule an appointment to talk more about the annuity. I said that I had covered this with the client that there was a large surrender charge and that it wasn’t likely in the man’s best interested to take the charge just to get into a conservative portfolio. The client agreed at the time. My manager insisted that I do it but I just ignored his request.”

Ah sounds like an Ethics question. lol

I see entry level Equity Research job postings for DC/NY/BOS all the time, but fewer postings for mid-senior positions. You’ll be taking a pay cut to make the transition. I’d imagine with the CFA charter (and some networking), you should be able to land one of these entry-level positions fairly easily. https://www.linkedin.com/jobs/view/727549078/

If you are still in the midwest and not in a major city (really Chicago) its tougher to break in. Fewer opportunities. Why should a company in NY/BOS/PHI/DC take a chance on a guy not from that city, when there are people with roots in the area that will probably stay at the firm a long time that are lining up for the job?

The MBA might actually be a turnoff. Employers think you might be expecting a higher salary because of your MBA. Having passed 3 levels of your CFA is not a turnoff if you ask me.

Only advice I can give is what got me in the door. Pass all three levels, learn to model out companies in excel (there are courses to teach you - BIWS, Wall street prep, etc.). Start an investment blog and show your research. It won’t be good but it’s a start and something to show potential employers. Also try to find out what you did wrong at interviews or why they hired someone else, thank them, and ask them for any advice.

yooooooooooo, are you an injun?

your story must miss the biggest part, your english looks like you are an international student and your h1b sponsor need prevents you from getting hired easily even your core knowledge of finance is undoubtedly great (since you are cfa level 3 candidate)

Take a look at the links in my signature for some guidance and possible inspiration.