Finance Recruiting Step 1: Understand the Industry
By Michael Jimney, Financial Leadership Program (FLP) Correspondent
Going through internship recruiting as a Finance major can be stressful. Months of preparation culminate in only a few 30-minute interviews to prove that you are, indeed, more qualified than the hundreds of other candidates the firm is considering (all of whom go to schools with larger footholds in the finance industry). Once you finally make it past the interviewing gauntlet, otherwise known as a Super Day, you will wait, seemingly forever, for a phone call with some good news. Taking the time to develop the skills necessary for finance recruiting can determine whether you will be waiting for your dream firm to offer you an internship or if you will be evaluating your back-up plans. As a senior here at Baruch, I survived this process. I would hardly classify myself as an expert, but I can pass down some wisdom I gained after experiencing this process firsthand. Over the next few weeks, I will be writing a series of posts on how and when to develop the skills you will need during the finance recruiting process. This week, I will be tackling Step 1: Understand the Industry.
Recruiting for a typical junior is a long process. While applications are due in December and January, there is a lot of prep work that must be done during the fall semester. It may seem like a disproportionate amount of pressure getting placed on one semester of school, but it is important to understand that a successful summer internship could lead to a full-time job offer upon graduation. To ensure your hard work pays off, invest time to do your homework about the industry for two reasons:
1) You will know which roles best suit your interests.
2) You will be able to speak intelligently to professionals.
While the second point is very important for networking and interviews, the first point can actually be very complex at this early stage. Most students have a preconceived notion about the world of finance. As a result, they quickly bucket themselves into a particular career path. Usually these careers center around Investment Banking (IB) or Sales & Trading (S&T) because those are, by far, the most well-known roles. I, too, was guilty of this and realized that it presented several problems. Firstly, I did not have a realistic expectation of what such a position entailed nor what skills were required to successfully secure my place. Secondly, there were several positions I had never considered and even some that I had never heard of which would fit my skill set far better.
Take the time during this initial step to actually learn about all of the diverse roles available in the world of finance. Go beyond the job descriptions and focus on learning the actual skills required in each job. A role like Credit Risk requires a similar skill set to IB given its focus on valuation and analysis of capital structure, but it has a different daily schedule. Students who enjoy the markets and are therefore considering S&T can apply that interest to Asset Management, Market Risk or Wealth Management. Finance and Operations also provides exposure to the world of finance by taking advantage of project management skills which most students do not fully appreciate. Explore the Vault guides to learn more information about roles you find interesting (they can be accessed by logging into STARR search, https://baruch-csm.symplicity.com/students). Such information might include what Analysts are expected to do on a daily basis, what skills they need, what their work/life balance looks like, and what you will actually be learning once on the job. While learning about different careers, remember to research which companies actually employ those groups/roles.
When you transition from researching finance positions to understanding the financial companies, a good place to start is by learning about the major firms. The biggest things you will want to take away are: what lines of business they have, how the firm makes money, and how they stack up against their peers. The finance industry can be complex so understanding the big picture can help later in the process, when more exotic firms or concepts arise. Annual reports are a great place to get specific company information (but can be very complicated for financial firms). Try leveraging additional resources like financial websites and a Bloomberg terminal, available in the Subotnick Center (http://zicklin.baruch.cuny.edu/centers/subotnick), which can give a more simplified look at the industry. Once you have the basic map of how major firms operate, it will be easier to understand the roles they contain.
At this point in the recruiting process, your goal is to form an opinion on a few target positions and companies upon which you can focus your efforts. Landing a job requires hard work, so you want to make sure you are working smart. Your interests and targets may evolve as you learn more. It is important that you make a conscious effort to expand your understanding on a regular basis. For the truly dedicated, this is a great time to get involved on campus with a professional club. As a member of the Wall Street Club and the Financial Leadership Program, I benefitted from listening to guest speakers share about the industry or teach a specific point of finance. These activities gave me greater exposure to experienced points of view. Baruch is a school full of students who willingly go above and beyond to break into the financial services industry, so your classmates and alumni should not be overlooked in your quest for information.
Reaching out to students here at school is one thing, but communicating with industry professionals is a totally different league. In Step 2 of this series, I will cover how to effectively prepare your soft skills to ensure you are getting the most from networking.