May 2011 Newsletter: Investment Banking Analyst Survey
Posted on: Monday, May 2nd, 2011
It’s spring time in Manhattan again. That means three things, it’s getting warmer, the grass is turning greener and it’s time for the annual “Long Ridge Partners Investment Banking Analyst Survey”. In addition to taking longer lunches, many Investment Banking Analysts are turning their thoughts to the future as they near the end of their Analyst programs. As it turns out, the positions they are seeking out more than any other this year are in private equity, which slightly edged out hedge funds by the narrowest of margins. So says the findings of a short survey we conducted polling some 500+ Investment Banking Analysts.
Of those who responded, 52.7% were first year Analysts, 34.5% are in their second year of their program and 12.7% of the Analysts are in their third year. Collectively, they have responsibility for 15 coverage, regional and product groups and a lot of them—43%—said they would like to continue to develop expertise in their current coverage or geographical group. Almost as many—39.6%—weren’t sure, while only 17% were certain they would prefer something else.
Mastering financial modeling and learning the importance of attention to detail and organizational skills are the two most valuable skills they have learned during their rigorous training programs, followed by the ability to execute in a team environment along with marketing and presentation skills. We were intrigued to find that developing an understanding of financial markets was at the bottom of their list.
Surprisingly, more than three-quarters of the analysts said they would be willing to leave their programs before completing them. And clearly, the quest for new career opportunities starts early with more than half of the analysts willing to begin interviewing for positions within 6-12 months of starting the Investment Banking Analyst program.
As expected, most Analysts expect to find their next positions through Recruiters. Firms hiring candidates directly was a distant second. Fewer than 20% of the respondents thought family, friends, mentors, colleagues or online services would lead to the next step. Interestingly, no one said they would seek career advice from a recruiter, for that, they would turn to a mentor, colleague, family member or friend (in that order).
All but a handful of respondents would be willing to work in the New York area, while the Northeast and the West Coast tied for second. In descending order, they said they would consider Europe, the mid-Atlantic region, Asia, the Southeast, Latin America, the mid-West and lastly, the Southwest.
Less than 5% of the Analysts polled expected to earn a base salary less than $90,000 a year, less than 20% anticipated earning more than $120,000 and the majority thought their next job would pay a base salary of $90,000-$100,000. To varying degrees, the respondents said it was important to do well in Investment Banking Analyst class. (Only a handful thought that rank did not matter.) And, no surprise, 75% expect to get MBAs.
At the end of the day, high GPA and SAT scores, top schools and 100+ hour work weeks pay off for this select group of over achievers as they are highly sought after by Hedge Funds and Private Equity Funds alike. The highest rated Analysts have the pick of the litter when accepting their next position and even those analysts who don’t rank at the top of their class have seemingly boundless opportunities open to them.
For the complete results of our survey, please click here.