Careers in Finance

Essential career guide for Finance and

Investment career aspirants

By Avadhut Nigudkar (Founder, FinanceWalk)

www.Financewalk.com

Feel free to share this guide with friends

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 Secrets to Building a Successful Finance
Career

Inside this book, I’m going to explain the secrets of building a successful career in
Finance & Investments Research & Analysis.

Before we get started, I want you to know that these tactics will work across the board –
from investment banking, commercial banking, financial services, research houses and
insurance.

How do I know these strategies work?

Because I’ve spent last 5 years studying the strategies and tactics that work in building a
successful career. I’ve discovered these proven methods that work in real life.

And, by the time you’re done reading this book, you’ll know these secrets and how to use
them to build a successful career in Financial Analysis.

Now let’s dig in.

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What employers want?

Last month, I had a chance to meet Founder of a financial research company (Read
“Financial KPO”) in Pune, India. As a trainer of equity research, I wanted to have first-
hand-information on what employers look in candidates.

Apart from graduation, there are other skills which are equally important to succeed in
careers like Equity Research, Investment Banking, Private Equity, Mutual Funds,
Insurance and Financial Research companies.

Here is the list of skills:

1. Graduate/Post graduate in commerce, Finance, Management. In some cases,

Engineers can also apply.

2. Knowledge about Income statement, Balance Sheet and Ratio Analysis

3. Analytical skills and logic

4. Right Attitude. This is the most important skill you need.

5. Excel proficiency and basic knowledge of financial modeling

6. Report Writing skills

7. Fluency in English.

8. Confidence

The above skills are not in a particular order, but they are equally important.

Many times I get mails for asking about placement. My simple advice to these people is
: learn skills, bring weightage to your resume, have right attitude and network.

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Employers are not looking for job-seekers, they are looking for people who can
contribute, take bigger responsibility and have long term vision and REAL passion for
such jobs.

I will make YOU empowered and smart through my interaction on Analytics. I am here
to teach you strategies that will help you make a long term career in FINANCE and
Equity Research, Investment Banks, Private Equity and Financial KPOs.

One advice: If you think, you can make your career without the above skills, Think
Again. This career requires your passion and contribution.

So, if you really want to LEARN the strategies, stick to this place and see the change
within you.

Why should you look for a career and not a job?

Are you an MBA, CFA, Graduate or an Engineer looking for a job in FINANCE, equity
research or investment analysis?

Great. You are not the only one who is searching for a job in this area. There are tens of
thousands of MBA students passing out of MBA institutes each year. When you enter
the college, you are made sure of placement in most cases by the institute. But, campus
placement happens only in top 25% of the institutes. What about the rest of the
institutes and its students?

If you look at the fees, it can range anywhere from Rs.1 lakh to 8 lakhs for the 2-year
MBA programs in India. The CFA costs you roughly Rs.2 lakh. After gaining the MBA
degree, you plan to apply to the dream job of yours and start “job hunting”. You apply to
the job and wait for several weeks/months,but you do not get a mail/call from the
company even after earning an MBA/CFA degree.

Do you know the reason?

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90% of you will not have any clue. I have an answer. You should plan your career in
such a way that you do not need to find a job. I will tell you the difference. Career is a
long term planning whereas getting a job is a short term thing. You will make your
career in equity research IF you are really passionate about the equity research area and
want to acquire the skills by investing time and energy into it.

Ask yourself this question: “Why the company should hire me if I do not
have the required skill set?”

Now, if you are committed to build a successful career in FINANCE, you will follow the
structured career path. What is this “structured career path”? Let’s see.

Structured Career Path – I

Excited to know what is “structured career path”?

Now, after knowing what employers want, I think you are clear about the demands set
by employers. I always insist on gaining experience and acquiring the skills required for
your career first, than to focus on “package”. Why do I say this? Ok…do not take my
word, take your time and think the logic behind this. The companies in FINANCE are
looking for the people who will do the job of analysing the companies, do financial
forecasting and valuation, write the reports for the clients and in some cases like mutual
funds and insurance have the relationship management skills. If you do not have these
skills, sorry, but they DO NOT need you. They need someone who will do the job and is
ready to work on the projects.

Now, you will say that “I am an MBA or a CFA and know the concepts very well”. But, do
you know how to screen the companies? Can you tell which company is fundamentally
strong and what is the value of the company as per DCF (Discounted Cash Flow) and
what is the peer company’s valuation in its sector? Can you forecast company’s
financials? Can you write research reports? Are you aware of different financial products

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and its usage? Are you smart enough to gain new clients? If the answer is “No” to any or
all of the questions, then, it’s high time you focus on acquiring these skills and then start
applying to companies and see the difference.

This is about functional aspects of the career. What about other skills? Yes, they are
equally important.

The HR people make use of the job sites like Naukri, Monster extensively for
recruitment. They look for certain skillsets and keywords in your profile. So, this is one
of the important steps in searching a job. Your resume should be strong and in
presentable format to get you shortlisted. I have seen many people tweaking their
resumes and making the profile search friendly and presentable and they have got good
response from the employers and some have even started their careers with good
companies.

How about your resume (CV)? Is it in presentable format? Are you getting calls from
employers? Feel free to share your experience with me.

Structured Career Path-II

We saw why you should acquire the skills that employers want. Now, I am going to focus
on the different profiles that a skilled candidate can look forward to grab.

1. Equity Research Analyst

2. Investment Banking Analyst/Associate

3. Hedge Fund Analyst

4. Mutual Fund Analyst

5. Private Equity/Venture Capital Fund Analyst/Associate

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6. Financial Analyst

7. Relationship Manager in Mutual Fund / Insurance /Financial Products

8. Financial Planner/ Wealth Manager

You can look forward to work as an equity research analyst or any of the above profiles,
provided you have required skills and knowledge. The career is rewarding if you know
the right strategies and execute them well.

Many times the candidate is not aware of the required skill set for such careers and he
wonders why he is not getting interview calls even after having the qualification like
MBA,CA,CFA. Well,the only thing you can grab this career is,by learning the right skills.

Let’s see what the job responsibilities of the above profiles are.

Equity Research Analyst

Fundamental Research, Report writing and stock recommendation. The candidates are
hired by captive or third party research houses of Investment Banks. It is also called
Financial KPOs. The work is good and an MBA, CA, CFA with no experience but having
the skillsets mentioned above can apply for such positions.

The candidate is expected to give stock recommendations normally limited to a

geography ( US,UK or Asia). The Analyst’s performance is judged on his quality reports
rather than the number of reports he writes. Here, the analyst is supposed to have
independent view.

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Investment Banking Analyst: Role and Responsibilities

Investment Banking Analyst roles are in demand. As we have seen in my last post about
Equity Research Career, the career in Investment Banking and Equity Research is
rewarding if you plan it well and have long term approach towards it.

If you are a fresher or have 1 year experience in a bank, you can apply for such positions
in Boutique brokerage and Investment Banking firms. You should have a graduate or
post graduate qualification (MBA,CFA,CFP,CPA) in business or management. You can
apply for the posts in the area of M&A, Operations, Quant, and Business Analysis.

The job profile varies as per the areas, for instance, a New Jersey job in Investment
Banking Business Analyst position comes with the responsibilities of identifying project
scope, defining project plan and workload, following up and report regularly to projects
sponsors, escalate issues related to this. Whereas, Investment Banking Analyst-Quant
in New York will have the duties like: research, deal processing and strategic business
development, researching and evaluating healthcare businesses under the supervision of
senior bankers, contributing to the development of information memorandums,
management presentations, pitch books and marketing materials and doing financial
Projections. While an Investment Banking Analyst -M&A working in New York with a
globally diversified financial services firm will have to work on : Analytical, due
diligence and transactional support on workout, restructuring, acquisition and new
business opportunities, developing financial models, pitch book materials and
conducting company research, analyzing data to help advise our current or prospective
corporate clients on actual or prospective transactions.

The skill set required to complete the above duties are:

· Strong quantitative / analytical skills

· Superior attention to detail
· Solid work ethic
· Excellent verbal and written communication skills

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· Ability to effectively manage multiple simultaneous project deadlines
· Proficiency in Excel and PowerPoint
· Solid understanding of capital markets and spreadsheet modeling
· Strong written and oral communication skills.
· Previous experience in M&A sector is highly desired
· Highly motivated with demonstrated ability to manage conflicting priorities and
requests
· Excellent interpersonal skills with ability to maintain relationships at all level in
organization
· Ability to take initiative and function independently balanced with strong teaming
skills
· Maintain high standards of professional and ethical conduct

The salary comparison of 3 cities, New York, Mumbai and London, for the Investment
Banking Analyst post is here :

A person with Certifications like Chartered Financial Analyst (CFA) and 1-year
experience can earn U.S. $50,000-$70,000 in New York. In Mumbai, the same person
may earn in the range of INR 3,00,000-10,00,000. In London, the person with the
same qualification and experience may earn in the range of GBP 20,000-50,000. These
are entry level packages for the people with the above mentioned qualification, skill set
and job responsibilities in 3 different geographic locations.

Hedge Fund Analyst

Hedge Fund Analyst, as a career, is challenging. In my previous article, I covered

Investment Banking Analyst’s role and responsibilities.

Firstly, we will see what is Hedge Fund?

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Hedge Fund is pooling of investments from high net worth individuals. These funds
invest in equities, bonds and commodities. The funds use investment strategies as long,
short, leverage and derivative positions. They invest in local as well as international
markets. They operate as a private investment partnership and investors are required to
invest very large amount initially. The funds take the investments for minimum a year.
They are similar to mutual funds in the concept of pooling the investments but differ in
flexibility and approach. The goal of the hedge funds is to minimize the risk and
maximize the return on investment. But, while doing so, they enter into speculative
transactions.

The profile of Hedge Fund Analyst:

1. Maintaining financial models for current and prospective companies of the fund

2. Performing valuation techniques

3. Data mining

4. Idea generation

5. Assist in the overall portfolio management process

6. Analysis of financial markets and institutional investors

7. Preparation of proposals, marketing materials, client presentations and client

reporting

8. Developing risk and asset class guidelines for managers

9. Making on-site calls to investment managers

10. Writing due diligence reports in accurate and timely manner

11. Developing a deep knowledge of the assigned hedge fund strategy

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Qualification and Skills required:

1. Deep knowledge of hedge funds

2. Need to demonstrate accountability and responsibility

3. Superior writing and analytical abilities

4. Excellent interpersonal and communication skills

5. Attention to detail

6. Ability to deal with colleagues, investment managers and clients.

7. Strong relationship building skills and ability to work independently

8. Leadership and initiative

9. Willingness to travel

10. Masters Degree and/or CFA, CAIA

The average entry level pay (combination of base & performance bonus) for the “Fund
Accountant” in this category, is US $40,000 in United States, in London,UK the pay for
the same post would be GBP 35,000 and in India it is Rs. 6,00,000.

Top hedge funds in US like Stark Investments, Davidson Kempner Advisors, and
Wellington Management have around US $ 10 Billion Assets under Management
(AUM). In India, there are Hedge Funds like Karma Capital Management, Atyant
Capital, and Atlantis India Opportunities Fund.

The career in Hedge fund is challenging and rewarding too. As you go up in the ladder
and reach manager position, you get strong grip on different investment products and
strategies and you get paid as per your performance unlike that of mutual funds where
the performance is compared with economic performance.

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Mutual Fund Analyst

Mutual Fund Analyst is the person who tracks mutual fund industry.

The profile is highly in demand and requires sound knowledge of Equity and Debt
markets. Candidates having MBA,CA or post-graduate degree in Finance/management
are suitable for this profile.

The typical work profile of a mutual fund analyst includes tracking debt market trends,
tracking mutual fund manager’s performance, interacting with fund managers,
preparing sector reports, preparing reports on mutual funds and new offerings, meeting
new clients.

The salary range varies based on experience. Candidates having 1-2 years of experience
in financial analysis can expect Rs. 5-6 lakhs per annum in Mumbai, India. Candidates
having 5-6 years of experience in this field can expect Rs. 12-15 lakhs salary per annum.

You can make a long term career in this area. People having 10-15 years experience in
mutual fund analysis, equity research can look forward to manage a fund. They are
called “Fund Managers” .

The responsibilities for the Fund Manager’s role include :

1. Managing the equity/debt/diversified fund with the support of research desk.

2. Taking investment and exit decisions for the fund

3. Deliver superior returns compared to the benchmark returns

4. Monitor investments

Apart from working with the mutual funds, the mutual fund analyst can work with
mutual fund research websites like Value Research Online, Mutual Funds India.

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Some of the current openings for freshers in India give an excellent platform for the
students to start their long term career. There are 35+ Asset Management Companies
(AMCs) in India having thousands of mutual funds in the market. There is a huge talent
crunch in the market for such roles. So, if you want to make career in mutual fund
analysis, have required skillsets, right attitude with educational qualification, you can
surely look forward to a long term career.

You can read more about mutual funds analysis on following websites :

1. Value Research Online

2. Mutual Funds India

Now,some of you might be interested to work in mutual fund industry.

Private Equity Analyst

Private Equity Analyst is the person who does research and analysis on private
companies.

Private equity analysts work with private equity firms. Such firms manage investments
funds or portfolio of private companies. They perform due diligence, financial modeling
and valuation of the companies where the fund wants to invest. In valuation techniques,
Discounted Cash Flow (DCF) and Internal Rate of Return (IRR) techniques are used
most frequently.

The job responsibilities of private equity analyst include:

1. Provide analytical and asset valuation support for company’s Private Equity and
Trading groups

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2. Provide input for strategic development and acquisition opportunities within the
specific industry

3. Develop and implement specific hedging strategies for various regions to maximize
profits and minimize price volatility

4. Effectively manage industry specific trading activity to insure compliance with

company’s financial, risk, and strategic objectives.

5. Reviewing and processing potential new private equity investment opportunities

6. Portfolio monitoring, reporting, and business development

7. Conducting research

What the companies look for in candidate :

1. 1-2 years experience in structured transactions, banking, consulting, trading or

analytical experience for a specific industry.

2. Strong knowledge of different industries and business models

3. Effective at handling multiple tasks, analytical and logical reasoning

4. Self-starter and excellent communication

5. High energy level

6. MS office, Excel, PowerPoint competency

7. Ability to build positive and productive relationships

8. Integrity, Professionalism, practical judgment

9. Result oriented and self-directed

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In India, Post graduates/ MBA/ CFA candidates are preferred for this role. However, in
London and in the US even Bachelors are considered for this role.

You can get more information on private equity on following websites:

1. vccirlce dot com

2. privateequity dot com

3. indiape dot com

4. indiavca dot org

5. vcindia dot com

According to PayScale, Private equity analyst having 1-2 years of experience in Mumbai,
India earns anywhere between INR 3 Lakhs to 14 Lakhs a year. In New York, US, the
same profile will earn $ 40,000 -1,00,000 a year and in London GBP 23,000 – 58, 000.

Financial Analyst

Financial Analyst is the person who performs financial analysis to understand the
financial health of the company.

In my previous articles, Hedge Fund Analyst and Private Equity Analyst, we covered the
details about the profiles. Financial Analysis covers fundamental analysis, ratio analysis,
financial modeling and valuation.

Broadly, in following areas the financial analysts are required.

1. Buy side firms

2. Sell side firms

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3. Investment Banks

Buy side firms are basically different funds, including mutual funds, where the financial
analyst studies different companies, performs research and analysis tools and give
recommendations whether to invest in the company or not for the fund. This is in house
research.

Sell side firms are basically research houses or brokerage firms. They cover certain
companies and write detailed equity research reports and sell this research to the
clients. The main idea here is to sell research and generate brokerage from client’s
transactions.

In Investment banks, the financial analyst’s role is different. Here, he covers mainly IPO
(Initial Public Offering) process and M&A (Mergers and Acquisitions) deals. The analyst
plays active role in all these deals.

Following is the skill set required for financial analyst profile:

1. Solid analytical skills

2. Curiosity and interest in analyzing, understanding companies in depth

3. Solid fundamental valuation skills acquired in business school, or as a consultant

4. Interest in understanding, analyzing a company’s business

5. Clear financial and quantitative concepts

6. Ability to build financial models

7. Sectoral expertise in Telecom, Media, Technology, Insurance, Banking, Food &

Beverage.

8. Strong analytical and MS Excel skills (Macros, V-Lookups and Pivot Tables) with
strong communication skills

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In India, entry level financial analysts earn in the range of INR 3,00,000 – 7,00,000 per
annum. In London, the same profile will give you the salary in the range of GBP 20,000
– 50,000. In US, for the same profile, you can earn $ 35,000- 80,000.

There are many KPOs where fresher and entry level openings are available. However,
check the skills they want for these roles. The selection process for the companies
involves case based test, and two rounds of interviews. My experience says, if you are
really good in fundamental and analytical skills, you can grab such roles.

So, brush up your financial knowledge and be ready to test your analytical skills.

Financial Planner/ Wealth Manager

Financial Planning has always been a need for a man. Be it a professional planning done
by a financial planner or doing on his own. With the introduction of many new financial
instruments and opportunities, the complexity of the profession has increased. To cater
to the needs of this growing complexity and to offer individuals customized financial
solutions, the profession called wealth management and financial planning is catching
the attention.

This profession requires the knowledge of how to grow and protect wealth, use of
derivatives, know your customer norms, anti money laundering and the principles of
wealth management and financial planning in practice.

Wealth management is becoming an attractive career, as many investment

opportunities are available for the people and the need for skilled professionals is
increasing.

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A financial planner or a wealth manager is a practicing professional who helps
people deal with various personal financial issues through proper planning, which
includes but is not limited to these major areas: cash flow management, education
planning, retirement planning, investment planning, risk management and insurance
planning, tax planning, estate planning and business succession planning (for business
owners). The work engaged in by this professional is commonly known as personal
financial planning. In carrying out the planning function, he is guided by the financial
planning process to create a detailed strategy tailored to a client's specific situation, for
meeting a client's specific goals.

Figure : Wealth management services

Source: www.edelcap.com

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Required Skills for Wealth Managers

1. Domain Knowledge and Professional Qualification

2. Client interaction and communication skills
3. Data Analysis and Comfort with computers
4. Leadership skills
5. Initiative and Innovative
6. Emotional quotient and perseverance

These were some of the FINANCE areas where you can make your career. How will you
build a successful career in FINANCE? You need a strategy.

Strategies/ Tactics

If you really want to know the secret of building a successful career in FINANCE, you
need to understand the strategy, I call it Framework.
The framework doesn’t just focus on short-term gains though. This helps you develop a
solid foundation of knowledge and skill set that will lead to a lifetime of
building a successful FINANCE career.

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The framework is based on 3 core principles.

1. Mindset and Passion

2. Knowledge and skill set
3. Creating a personal brand and promotion

As a coach, I will help you focus on these 3 principles and build a successful career in
Finance.

“Hey, Wait a Minute…”

You made it! You’ve reached the end of my first report.

If you found this report helpful, you’ll be happy to know that when downloading this
report, you signed up to receive FREE updates.
Now you may be wondering, “What free updates?”
Over the next few months, we’ll create tons of valuable content that will teach you how
to make your career in Financial Analysis area.

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About Finance Walk

FinanceWalk is an educational initiative to help you build a successful career in Finance

and investment area.

My name is Avadhut Nigudkar, and I am the founder of FinanceWalk. I worked as a

financial analyst for seven years and since 2007 I’m into financial education space and
educating people in financial analysis area.

If you have any questions related to FINANCE career, feel free to contact me, on
avadhut.nigudkar at gmail dot com. I’ll gladly answer any questions you may have.

With best wishes,

Avadhut Nigudkar

Founder, FinanceWalk

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