There is no doubt that the profile of an equity research analyst is quite a fascinating one. It is filled with greater opportunities, an interactive work profile, and classy positions that keep you busy all day long. Additionally, with immense resources available for the equity research analyst, you can keep yourself busy learning daily.
But that’s not what a typical day in life of an equity research analyst looks like! It is more complicated and filled with various analysis and in-depth research that companies and organizations can use to gain benefits. Before we explore the different parts of a typical day in the life of an Equity Research Analyst, let us see the work culture of firms working in the segment.
General Work Culture In Equity Research Career
When we talk about the general culture in any firm, field, or profile, it links to the environment of working and the work that you must accomplish daily to be fruitful. In simpler terms, it is how you will work in the organization, mix up with the people and prove your worth as an employee. So, here are the top things that you should know when you are willing to explore the work culture of the equity research analyst:
- Your day will be long, so be ready to work from 9-7 daily. The average working hours that the equity research analyst or associate devotes to the office range from 60-70 hours per week approximately.
- During the investing season or the peak hours, you should be ready to work for an average of 100 hours a week, which is around 12-14 hours a day.
- There will be conferences that you must attend day-in and day-out. Presentation, communication, and discussion are integrated parts of the equity research analyst profile.
- There is a chance when you might get stuck in some urgent project and you get a call to work during weekends.
- Your hard work will be paid off in terms of bonuses or advances in your career.
- The work offered here is not monotonous, so you will be able to explore one or other profiles daily.
- The profile will help you gain detailed information about various sectors, which is an added benefit in various ways.
- You need to be aware of the market and what is happening in the economy at both the national and international levels. It will help you draw better inferences for the future, which is a must to grow.
So, if you are ready to devote your time and use your skills to the best while ensuring to upskill on the way, this is the dream career you should go for. So, now let us explore the different parts of the daily life of an equity research analyst while on the job.
Equity Research Analyst Typical Day
An equities research analyst is in charge of following or offering expert comments on a specific number of firms in his industry. This usually varies between 10 and 20 firms for each analyst. Analysts are expected to provide regular commentary on the companies they cover. Additionally, during earnings season, analysts will issue quarterly notes on their company’s annual outcomes.
An equity research analyst will publish in-depth articles about a company’s drivers or longer-term trends affecting the sector, such as the impact of driverless cars on the auto industry.
So, here is everything that the equity research analyst is supposed to do daily:
1] Start your day by knowing what’s happening around
This is a perfect way to describe how the day starts for an equity research analyst. Since the main job profile is linked to analyzing various stocks and the linked market scenarios, it is important to know the market conditions, economic situations, policy changes, and any other linked information that can help make future predictions. You can do it by reading the newspaper or checking the authentic online portals that most lucidly and simply share the full detailed information. You can accomplish this by following wire services and other news sources and following global economic and market events and trends. 3
Analysts stay on top of breaking news that affects the stock markets and the companies they cover throughout the day, gathering information from both industry-specific and broad news sources. This may be quite a roller-coaster trip on very volatile market days as you would be required to keep up with your analysis while maintaining an eye on the world news at the same time. Also, apart from keeping updated with the news, the equity research analyst would be required to study the basic information available on the net weather in the form of blogs or books to understand what the people are expecting from their investments and how they can help them to attain that particular goal.
2] Connect, communicate, and coordinate with the colleagues
As the equity research analyst, you will not be working alone. Instead, you will have an entire team to support you and coordinate with you. Your work will remain incomplete if you fail to connect and communicate with them. Having a small meeting at the beginning of the day to share the fair’s target and the lucrative and important information to be kept in mind while analyzing the stocks can be helpful. Additionally, there will be a few associates and sometimes interns as well. These people rely on you for the information and insights, and you will be required to share your in-depth understanding and information with them.
Basic information like which stock to buy, which stocks to sell, and the holding ratings should be shared with your colleagues to have common knowledge among the team as to what today’s plan is. The skills that an equity research analyst will be required to possess at this particular place will include:
- Analytical and creative thinking
- Good communication skills
- The ability to quickly and accurately synthesize data from various sources quickly and accurately
- Deliver it understandable to all. This will need the analyst to be aware of the visualization techniques.
3] Make an issue report to keep a track
You cannot remember everything, so it is important to list down important points for future reference. In simpler terms, the equity research analyst will be required to chart down all the profiles, details, insights, and results in the form of a report that anyone in the future can access. Since the job requires making the forecast, the analyst must create monthly, quarterly, half-yearly, and yearly reports to keep track of progress and find out the flaws that you should rectify to gain better.
Analysts track any specific developments that could affect the value of any company in their particular group and follow broad news and economic events.
Say, for example, a company launches a new product. Now the equity research analyst would require following the market trends about the product launched while also ensuring that a detailed report for changes is made. Now, you must be thinking, WHY? Based on the market report, news, and projections, the equity research analyst can make predictions about the movement of the share prices for the company in the future. This way, he can make informative decisions and help the investor and companies make better returns.
4] Stay connected with the top management
The equity research analyst cannot work without staying connected with the management of an organization. He must share daily reports and progress with the top management while discussing the potential changes you might require to stay afloat. At the same time, information linked to policy changes internally and the organization’s plans are also important to be known by the equity research analyst. While management offers such information to equity research analysts, executives must be careful not to share any nonpublic information with analysts that could affect the company’s stock price. This would give the analysts an unfair advantage.
Analysts must present investors with an accurate view of a company’s potential, but they must also avoid alienating management and risk losing access to critical information.
5] Analyse and find opportunities
One of the most important things that the equity research analyst needs to do daily is to make analysis and find the opportunities for a better future. That means that the equity research analysis is entrusted with the responsibility of presenting the right information that individuals and companies can use to make the proper investments. While there are various misleading pieces of information going around, the equity research analyst needs to make sure that his information is apt and useful. With the stringent policies and procedures levied by the managing organizations, the equity research analysts are pressured to offer the right information and mark down the wrong ones.
Not only this but at the end of the day, the equity research analyst is also required to share the opportunities where you can invest for better opportunities. It should be such that it should help you to earn better and ensure that your capital invested in the venue is secured at the same time. It is the responsibility of the equity research analyst to offer the solutions to the companies and organizations to make changes in their product or process in the future that can help them on economies of scale.
6] Feedback and review
Not a single day in the life of the equity research analyst is complete without having the Feedback and review. The equity research analyst must connect with the team at the end of the day and discuss the progress made for the day. At the same time, the equity research analyst is entrusted with pointing out any mistakes or gaps that the team might have left out during the day, which can be a reason for potential losses for either the investor or the organization. Repairing the associates’ progress at the end of every day will help them become better each day and learn new skills that would be helpful for the organization and the equity research analyst in the future. Additionally, when you review the work done at the end of the day, the chances of disconnect or any kind of complaint become negligible, which is one of the most important guidelines for becoming a successful equity research analyst.
The time spent by an equity research analyst in working is much more than others. He must invest hours in making a proper research report by analyzing the data and making the right analysis outcome that can help make better decisions. Right from keeping up with the news running in the market to helping the colleagues know about what they are expected to do today and analyzing and reviewing the daily progress the equity research analyst has and the handful of jobs that he is required to accomplish every day. For many, all this work would look like a basic task, but when you look at the complexity and the time involved in completing it such as the need for a knowledgeable and skilled equity research analyst for the organization as well as the investors cannot be denied.