Picking An Investment Banking Summer Internship: Equity Research Vs. Trading
One common question I’ve been getting lately is how to decide on a summer internship when you have multiple offers. For those lucky enough to be in this position, how do you pick which internship to accept and which to turn down?
Since this varies quite a bit for each person, I’ve anonymized and listed below several of the questions I’ve received and responses I’ve written thus far.
Equity Research vs. Trading
“Thanks for the site and all your help. I’ve received an offer from a bulge bracket equity research division, as well as a trading offer from a well-known international investment bank that is somewhat less prestigious.
I’m not sure which to take, as the bulge bracket offer is more ‘prestigious’ but I am personally more interested in trading. However, I am still considering the research offer because I think it might be easier to leverage into other opportunities and because I might be able to switch into trading at the bulge bracket at the end of the internship.
I’m afraid of burning bridges and not sure what to do here.”
Congrats on both offers – sounds like you have some very good options this summer.
Personally I would go with whatever you’re more interested in (sound like trading from this).
The bulge bracket offer is definitely more prestigious, but I feel it would actually be easier to leverage a trading job into better full-time offers and exit opportunities vs. a research job. In general it is easier to switch across different banks in the same industry vs. switching into different groups at the same bank, believe it or not.
That said, you can’t go wrong with either one. I would go with your gut and pick the one you’re most excited over, as that is usually the right approach to take.
Bulge Bracket vs. Bulge Bracket In Asia
“I recently received summer internship offers at 2 bulge bracket banks in Asia. Could you give me some input on these two banks to help with my decision? I’m concerned because one of these banks has suffered writedowns and been in the news a lot recently, even though its Asia division still appears to be strong. Any opinions that you have on those two banks would be greatly appreciated!”
Great news on the offers – congrats! Unfortunately I know relatively little about the Asian offices of these banks – personally, I would err on the side of picking the one with a stronger business that has been less affected by the credit crunch and writedowns.
Even if the Asian branch of a particular bank is strong, if its overall business has suffered greatly there’s no telling what will happen in terms of layoffs or future opportunities.
That said, I think you should base your decision on more than the strength of each bank’s overall business. As I’ve written about before, your investment banking team and the people you work with are more important than the “prestige” of the group. Figure out which group has the best dealflow, the best opportunities and the best people to work with and go there.
Other Thoughts
I feel I should also point out that “prestige” for summer internships does not matter nearly as much as it does for full-time banking jobs. Yes, working at Goldman or Morgan will put you in a better position, but I’ve seen people leverage internships at boutiques or middle-market banks still wind up with bulge bracket full-time offers in the fall.
For summer internships at least, doing investment banking vs. not doing investment banking matters more than Goldman vs. JP Morgan.
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Please help. I was just offered summer Internships at two places. One as an Investment banking analyst at Piper Jaffray and the other with Barclays on their sales and trading team.
My question is which one would help advance my career more / which is a better job and help me get into Business school?
Any advice you can give me would be a huge help.
Thanks.
Alex A.
I would do PJ if you want to do investment banking, and do Barclays if you would rather do other finance fields in the future.
If I wanted to go into a structuring or strategist role (think research for a particular desk within trading), would it be better to aim for research (non-equity) or trading internships for SOPHOMORE year? I know, you will probably say take whichever you can get, but if I’m only allowed to apply to one, which one?
It seems as if trading will be more related, but I will learn more during research internship and still have junior SA for trading if I want.
What’s your opinion?
Trading is better for the reasons you mentioned
Hello M&I:
Just want to know if Equity Research would be a relatively easier way to break into Finance/Investment Banking? Again, I don’t have a finance background and I wonder with my MBA from a Top Tier or 2nd Top Tier school in Canada, will aiming/targeting an Equity Research job be easier to get my foot in the door. Please advise.
Thanks.
Regards,
No, not really – ER is smaller and accepts fewer people but also has fewer people applying, so the odds are about the same. If you had a Ph.D. then equity research might be more viable since a lot of times they want people with deep industry experience / advanced degrees
Hello M&I:
In your opinion and to your knowledge, what would be the easier field or job categories for a person in my situation to ‘break’ into Finance/Investment Banking? I know there is no abolute answer as there are many other factors but just want to get an opinion on which one is relatively easier. Thanks.
Regards,
KS
ER is definitely not easier than IB. PWM or other types of asset management are probably your best bet if you want something slightly easier than IB/PE/ER.
Is Trading easier than IM?
It really depends on your strengths, skills & personality so it varies a/c to the individual.
Hi Brian,
I’m currently doing an internship at a boutique asset management company and I was wondering if you knew what kind of work I should be doing to best position myself for FT ER? So far, they’ve had me working with the marketing team, creating books mostly. I’ve asked a research analyst for some research work and he sent me a template of how they evaluate companies. With this experience, would I be able to write Equity Research Intern on my resume, even if I haven’t done too much research?
Thank you so much in advance.
No I would not write equity research. Focus on anything that involves valuing companies or analyzing investments and try to minimize the marketing.
Thank you for your reply. I just had a short follow up question: what should my title be? My company doesn’t have one for me because my internship is off cycle and I’ve been rotated a bit. Also, I plan on either going ECM IBD or Equity Research after I graduate.
If they don’t give an official title just say “Valuation & Research Intern” or something along those lines.
Hi – great site with great info!
I am interested in pursuing a research analyst position or something similar that leads to portfolio management. I have 3 years experience at GS in a Fund Controllers role (although none of it relevant to research or PM) and recently received an MBA from an upper 2nd tier business school. Additionally, I am registered to take the CFA Level 1 later this year.
What route do you think is most viable for me to break into a career in research/PM? Applying for an analyst position at a boutique firm?
Thanks in advance!
http://www.mergersandinquisitions.com/hedge-funds-institutional-asset-management/
Hi Brian,
A really great site. I’ve been trying to break into IBD/ECM in Asia and have just heard from a bank about an equity research project. What would you say are my chances to leverage this to break into IBD/ECM roles/
It will help I guess? Anything related to what banks do should help.
I hear alot about Equity Research but how about Fixed Income Research? Is this under Investment Banking or Asset Management?
It is more under sales & trading actually, similar to equity research but relates to the trading side of the firm instead
Hi Brian,
great site! I felt blessed to find this site because I opened this page by accident!!
I had 3 years audit experience with a Big 4 accounting firm and now doing master of finance degree in a 2nd tier business school. I’m thinking of getting into ER. In your opinion, what are my biggest weaknesses? I’m gonna graduate in august 2012, if I apply for a summer intern then, would it be a bad strategy?
Thank you very much for your time?