I’m currently working as an equity research analyst at a mid-sized investment firm and have been in this role for about three years. While I’ve gained a lot of valuable experience, I’m considering making a transition to portfolio management. I’m particularly interested in the strategic decision-making and asset allocation aspects of portfolio management.
Here are some details about my background:
Education: CFA Charterholder, Master’s in Finance.
Experience: 3 years in equity research, focusing on tech and consumer sectors.
Skills: Strong in financial modeling, valuation, and industry analysis.
My Questions:
Skill Gap: What key skills or certifications should I focus on to make myself a more attractive candidate for a portfolio management role?
Transition Path: For those who have made a similar transition, what steps did you take to move from equity research to portfolio management?
Networking: How important is networking in making this transition, and are there specific groups or forums that are more effective for portfolio management roles?
Realities of the Role: What are some of the challenges you faced when moving into portfolio management that you didn’t anticipate?
I’m open to any advice or insights you can provide. Thanks in advance for your help!
I work as a risk manager in asset management & portfolio management and have worked with approximately 70-80 portfolio managers. My advice might be quite unorthodox but I think it is very relevant:
Learn how to tell good stories.
Most PM’s are from the same schools, have read the same books, some are CFA’s, some CAIA’s or whatnot, some know how to code, some do fundamental analysis…whatever, it’s all the same. The fact remains that most of PM’s do not beat the market, a vast majority do not add value - they destroy it, most of them lose…year after year. Occasionally, there is some “star” who has a good run but then crashes like a meteorite. What makes a good PM is the one can tell stories to upper management and big clients. A good PM can walk into a boardroom and convince why someone should invest in your fund, regardless of your subpar performance. A good PM knows how to explain why AGAIN this year, the FX risk messed up the performance, or why performance was bad due to some external matter. That is my advice - learn to tell stories, since it will not be your skill or smarts that will get you the job.
I agree with @TrackSuitInvestor. Very little “hard” skills needed to actually run a portfolio: general knowledge of a wide array of topics is obviously needed, but with your background, you’re all set. On top of that, I’d say that soft skills (did someone say bullshitting skills?) is needed.
Focus on developing portfolio construction and risk management expertise. Learn about asset allocation strategies, optimization techniques, and multi-asset investment management.