With the internship season upon us, I want to share my advice that help you make the most out of your research internship.
Unless noted otherwise, the word “equity research” in this article refers to sell-side equity research, who produces research reports for institutional equity investors.
You Will Have Many Customers
Your number one customer in the summer will be your immediate sector team. Your top priority is to add value to your team in all ways possible.
- Take the initiatives: Ask for work. When there is downtime and your team is too busy to give you work, read and summarize articles that might be of interest to your team.
- Show great attitude: Do the grunt work that your team does not want to do (if it makes you feel better, the junior full-timers will do what you are right now when you leave the internship).
- FILO: First in, last out. Come into the office earlier than your team and leave later than them.
- Offer to get coffee or lunch for the team: Remember this is another opportunity to demonstrate attention to detail by getting the orders right. As a rookie, even LeBron James had to carry equipment for more senior teammates.
- Get face time: If the firm offers hybrid work, try to be in office as much as you can, even if your team doesn't go into the office. It gets you noticed and gives you chance to network. A follower who told me he got extensive facetime with the Director of Research precisely because he was one of the few associates who went into the office.
Your number two customer is research management. There is usually a director of research and a deputy director of research. You need to make a good impression with them.
Finally, network with people outside your team. This is a great transition to the next section.
Ultimately, your MD and your immediate team’s feedback matters the most to your full-time prospect. To a lesser extent, research management’s impression of you and the hidden decision influencers, such as other sector analysts, can have incremental impact on your full-time prospect.
Making People Like You
If there is one thing you should take away from this article, it is: MAKE EVERYONE LIKE YOU.
As an intern, you were hired by the bank and not by a particular team. So outside the team you will be on, you need to win over external parties. If you came into this internship thinking mastering the technical skills will win you the return offer, you missed a big point.
What this means? You should network with other sector analysts. One, you can uncover things you don’t know about your immediate team. Two, you build relationships with sector experts – I don’t see how that can hurt. Three, you never know who are the hidden decision influencers that help you secure the return offer. Most people don’t tell you about the last point.
How to network? Learn about their background, prepare good questions, and have an engaging conversation. The only thing to note is to keep it balanced, meet only a few new people every 1-2 weeks. Over a 10-12-week internship, you should make a lot of strong connections if you are consistent.
Same goes for the associates from other sectors. Set up coffee chats and introduce yourself. The associates have best tips on how to do well in the profession. They also go on to work in investor relations, corporate, or the buy-side. They are good connections to have who can show you the ways of what comes after equity research, if you don’t plan to be a lifer.
Asking Good Questions
Before you ask questions, try your best to figure out. A lot of times simple Googling will do.
Specifically, before you head into that one-on-one with the research management, prepare good questions to show you respect their time. General tips:
It’s human nature that people like to talk about themselves. So ask them about their career.
- How was their transition from an associate to becoming an analyst?
- How to communicate ideas concisely with sales people?
- Ask about the direction of research department.
- How does the firm differentiate against competitors?
- What do they think about the future of the profession?
- What three advices do they have for associates?
- Read up on MiFID II, it is the biggest news buzz since Reg FD. Ask about how they think about the impact of MiFID II to the firm.
- Most, if not all Director of Research used to a research analyst. Read up on the sector they used to cover and ask their views on the sector
Crushing The Final Presentation
At many shops, you will do a final internship presentation in front of your immediate team, research management and other sector analyst in attendance (depends on how many analysts you have built relationships with, see my point on making people like you?)
Make sure your final projects are interesting and relevant:
- Interesting: Sell side is about selling. One of the ways sell-side research adds value is to make clients think. Come up with an original idea, even it’s crazy (flying cars, plant-based meat, etc). Take a look at how the private companies in your sector are disrupting, that’s a good hint on what problems remain to be solved (or can be done better.) Your team can help you frame the argument and put some numbers around it – size up the opportunity and how the economics will work. I remember the intern on the Industrial team during my internship pitched something about drilling, the director of research fell asleep, you do not want that.
- Relevant: All the data gathering and work product that you created that led to your final presentation should be usable by your team after you leave the internship. If you do a stock pitch, it should be something the team can initiate on. If it’s a thematic deep dive, it should be a note that client might be interested in learning more about.
- Mentor: You will likely be given a formal mentor. If they are straight shooters like me, you are in good shape. If they are very formal and promoter of the firm, get your own mentor within the department, preferably an alum who can tell you what the department, your MD and your immediate team are really like. You need to know the real inner working, not some sugar coated corporate messaging.
- Avoid mistakes: Print out your work and triple-check it. You don’t have any insights or know what drives businesses yet. The best you can do is to prove you are dependable. Keep a mistake log. If you make a mistake, at least you create the perception that you are learning not to make the same mistake.
- Have a good time: Enjoy the experience. Don’t just focus on trying to convert to a full-time offer. Don’t think about your fellow interns are enemies playing a zero-sum game. Make friends with the people in equity research and your fellow interns within and outside equity research. A lot of you will go on to do great things regardless of which company you work for or which career path you pursue.
- Because you will not be licensed, your name will not show up on research reports. You cannot talk to clients or other external parties about your analyst’s views on covered stocks.
- In general, HRs are not your friends. I would think twice about escalating any work-related situation to HR first. Instead, talk to your mentor (preferably the informal one) on how to navigate work place conflict or mistreatment. Obviously escalate if you are physically assaulted or sexually harassed.
- During my internship, one of the undergraduate interns was poorly treated by his manager who is a pompous VP type. The intern has a liberal arts background so he could’ve used some hand holding on technical skills, but this manager did not want to train and was very impatient. So the intern escalated it to HR. The HR notified the MD of the team, and the MD became the intern’s manager to babysit him and the entire department knew about it. At the end, that intern did not get a return offer.
With that, I wish you the best this summer.
If you are interested in learning more about sell-side equity research, I have two other great articles for you:
Don't know where to start to research and value a company? Have trouble generating stock ideas and differentiating on stock pitch? I can help you. Let's meet!