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  • Abdul Tambal

Traveling in Equity Research

In my view, traveling in equity research is one of the most fun parts of the job, unlike the experience in other areas of finance.


More often than not, the primary deliverable from traveling as a junior in equity research is to write a key takeaways report highlighting what you’ve learned on your trip. That means you’re more focused on absorbing information and asking thoughtful questions which would be useful for your clients throughout your trip.


From my experience, all travel at the junior level falls outside of the busy earnings season. This means that there likely wouldn’t be urgent tasks to deal with on the road. However, the reality of working in equity research is that much of your work involves reacting to breaking news, so you might have to quickly publish an unexpected note from the road. More often than not, if it’s something another junior member of your team can handle, you’re generally free to focus on being present on your trip.


While team sizes can vary depending on coverage, they tend to be on the smaller side overall, so you might not always have someone to cover for you. Hours in equity research are relatively more relaxed than in investment banking, so you actually might get the chance to explore a new city in your downtime.


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Traveling in Equity Research


Traveling as an Equity Research Analyst


I remember being surprised at how quickly I was given an opportunity to travel as a junior in equity research. I traveled to attend an industry conference in Las Vegas within a few months of my first equity research job at Goldman Sachs. However, given the dynamic nature of the job, and work that’s unique to individual teams, it’s tough to generalize across all potential experiences.


So, why does equity research give juniors an opportunity to travel more than other jobs in finance such as investment banking?


  • Event coverage – A big part of running a successful equity research franchise is visibility. If a company you cover is hosting an event with your competitors in attendance, your equity research team will need to be present to avoid missing out on useful information in person. The senior analyst would send a junior to attend on behalf of the team if they can’t attend themselves, in order to take notes which they would attempt to turn into a complete draft of a report.

  • Teams care about the development of junior analysts – A quick way to learn as a junior is to be around other seasoned analysts to hear the types of questions they’re asking corporate management. Analyst development tends to be more clearly in focus in equity research since average tenure is longer particularly when compared to investment banking. As one of the most common exit opportunities from equity research is to the buy side, it’s highly likely that juniors would become direct clients of an equity research team after a transition. Maintaining good relationships and investing in junior development is actually a good business strategy from the perspective of a bank’s equity research department.

  • Helps to ramp up quickly on a stock or industry – Visiting a company’s factory or headquarters can help solidify the nature of its operations to a junior analyst. For example, attending a factory tour can help you visualize how a company lays out its assembly line, the types of raw materials used, and how well a management team works. As a junior, you’ll likely attend company tours as the sole representative of your team, particularly for smaller cap companies that are less important to your team.

  • More flexibility in delivering a finished product – There’s less of a time crunch associated with publishing notes from some trips, especially since the final reports tend to have longer shelf lives. There’s no live deal on the line that would demand your attention in the way that there might be for investment bankers. You’ll likely have time to draft a key takeaways report at the end of a travel day which you’ll send back to your senior analyst to review before publishing. You will have time to iterate to get the correct tone.


Types of Events

Analyst Days & Corporate Events


Analyst days are hosted by companies in order to give analysts who cover their stock a better understanding of their business model, strategy, and new market opportunities they are pursuing. They sometimes include updated information about financial performance, which warrants publishing a report and model update quickly. These are normally either hosted at the company’s headquarters or at an accessible location for most of the analyst community, which is likely in New York City. If you work in Manhattan, that means that you’ll probably just be commuting by subway.


Client Meetings


In-person client meetings are a way for equity research analysts to keep their clients updated on their investment recommendations while giving them the opportunity to ask questions and get real-time feedback. It’s very unlikely you’ll be attending client meetings in person alone as a junior, even within the same city you’re working in. Senior analysts typically schedule several meetings with clients within a city they’re already traveling in as part of their marketing. You'll likely be asked to attend some of them if it's convenient for your senior analyst to bring you along.


Conferences


You’ll attend many industry conferences as an equity research junior. These events host many (sometimes hundreds) of companies within a small group of related industries. Their function is to give participating companies an opportunity for business development, while doubling as a forum for meetings between investors, company management, and equity research analysts. They’re an excellent opportunity to learn about many different important companies in your coverage group, and directly interact with both clients and corporates. As a junior, I have traveled to many conferences, both internationally and across different cities in the U.S.


The frequency of traveling to conferences depends on the industry you cover. I still think it would be safe to say you’ll travel at least a couple of times a year to attend conferences to the extent they’re hosted outside of the city you work in.

This link from StreetInsider can give you an idea of some conferences hosted by investment banks. For example, if you’re covering healthcare stocks out of Manhattan in J.P. Morgan, you’ll likely attend its annual Healthcare conference in San Francisco.

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