How to prepare for an equity research interview?
Posted on: July 4, 2013 /
Categories: Equity Research Interview Questions
Read the newspaper (or a financial website) daily:
- Prepare to talk about a recent M&A deal. Bonus points if the deal is in your sector. Also, form an opinion on whether the deal is in the interest of the shareholders or not.
- The more you read the paper the easier it will become to discuss macro economic themes, which is crucial for any finance interview.
- Monitor how the major companies in your sector have been performing. Did the earnings beat the street? Is the outlook strong? Any sector wide challenges/issues?
Prepare to talk about specific companies:
- The most common question is: what would you buy?
- Discuss specific catalysts and macro themes.
- Bonus points if you can identify reasons to buy a specific stock that are not well-known to investors yet.
Form an opinion on where gold, oil and the U.S. dollar are heading:
- Keep in mind that there is no wrong or right answer.
- It’s all about your reasoning. You should support your answer with facts and analysis.
- In most cases the interviewer will take the opposite side of the argument. Again, no wrong or right answer, so don’t back down.
Some points to keep in mind:
- This might be a bit difficult at first, but always distinguish fact from opinion. Analyse the facts to arrive at an opinion.
- Smile. You are selling your analysis and opinion. A smile shows that you are confidant and comfortable with your answers and you enjoy chatting about finance in general.