Ask The Headhunter Home Page
Ask The Headhunter Home Page
More about Nick's book...
Go to Archive Menu The Archive


Back to the Archive Menu

How To Approach An Investment Job
By Lisa Locher

Many people who come through Ask The Headhunter and The Motley Fool are interested in careers in the investment business. If you're considering a job in this industry, you probably already have some basic knowledge about it. You know a stock from a bond. You know that Warren Buffett isn't an all-you-can eat place in Omaha. You know that the S&P 500 isn't a NASCAR race.

But what else do you need to know before attempting to get a job in the investment industry? Here are some suggestions from someone who's been there, done that. If it helps you avoid just one wrong step, then this bit of mentoring has been worth it.

Be Realistic
It's fine to have lofty goals for yourself, but you need to understand how you're likely to be viewed when you approach a company for a job, especially if you're changing careers.

Newcomers to the investment industry are most likely to find themselves segregated into two classes: those with a sales background and those without. Those with a sales background are much more likely to be able to go into a stockbroker trainee program, in-house mutual fund sales, or even the dreaded financial planning area. (Of the three, financial planning is probably the most savage environment. The planning business routinely chews up and spits out untold wannabe's who just can't develop a book of new contacts quickly enough to sustain a business.)

Those without a sales background or any work experience might find themselves working as trading desk clerks, sales assistants to brokers, research assistants to portfolio managers... all very good starting points where one can learn the business from the bottom up and get a little exposure to a firm's broader business activities. Many people (like me) start out in these positions, where they are able to refine their interests and skills and then chose which path to pursue.

Be realistic about what kind of job you're likely to get, and go after it with a vengeance.

Do The Reading
There is some "absolutely required" reading when you're preparing to seek a job. Any successful person -- or successful job hunter -- in the business will read the Wall Street Journal and the New York Times  daily, before the market opens. And that's the bare minimum... extra credit for Barron's.This is time consuming, but necessary.

Other important publications include: Pension & Investment, The Motley Fool, Smart Money (the new hot magazine for younger investors), and Institutional Investor. Forbes, Fortune and Business Week are good sources as well. Definitely be aware of the "popular" averages' closings for the previous day. You'll want to know where the Dow Jones Industrial, S&P 500 and NASDAQ averages closed, as well as how those closings rate historically (i.e., Was it a new high? A substantial percentage gain or loss? And be sure you know what "caused" any of this"... look to Alan Greenspan if it looks unexplainable!).

If this all seems obvious to you, that's good. As a hiring manager I can tell you too many job candidates don't bother reading much at all. Think I'd hire them?

Getting In The Door
Don't send out blanket resumes. (You'll learn more about this time-waster in The Basics on Ask The Headhunter.) Resumes will rarely end up in the hands of the person who makes the hiring decisions. You'll get a form letter and your resume will be "kept on file".

A better approach is to use the research you've done to identify a key person at the firm you're interested in. Call and ask if you can come meet them just to get general information on the investment industry. Someone at some level will usually be willing to comply. This is a no-lose approach. It is also often a source of leads to other firms that may have positions available, because "insiders" know one another and frequently refer candidates back and forth.

When you make this call, be extremely pleasant to the receptionist. Don't lie about who you are, or how well you know the person you're trying to get in to see. These people have incredible power... they're the gatekeepers. They will translate and route your message to the proper person. If they like you, you've got a chance of getting an appointment. (Trust me: I've been both a job seeker and a hiring manager who has relied on a receptionist's judgment.) Be honest: ask the receptionist if she has a second to talk to you, then explain your situation. If the receptionist recommends the personnel department, explain that you'd really like to talk with someone in management. In most cases, you'll at least be given the name of a person you should call. Remember that the receptionist's job is to route calls; she doesn't want to hear your life story. If you get an appointment, be sure and thank the receptionist for the help when you arrive.

Know Your Quarry
When you approach an employer, it isn't enough to be able to talk about the stock market. You need to know the investment style of the firm you interview with. Nothing is less impressive than someone who goes to interview with a growth fund manager or a brokerage firm that specializes in tech stocks and discusses the benefits of Coca-Cola ad nauseum. It shows you haven't done your research on the firm you're interviewing with. This information is easily obtained from the firm's Web pages, articles that have been done on the firm in industry publications, or from prospectuses of mutual funds that the firm may run. Give yourself some time to gather this information. It's time well spent.

If you can't unearth much information about the firm, call and say you're a prospective client and request whatever information might seem reasonable for them to share. Of course, this is not advisable if you're an individual investor and you call an institutional manager. Brokers, for the most part, will not have one investment style, but will be diversified. Smaller or "boutique" firms are the exception to that rule because they specialize. Only careful research will turn up what you need to know; get started.

Demonstrate Your Commitment
This is an industry where you can't hide ignorance or a lack of motivation. You must be a "user" of the products and services you're selling. That is, you must be an investor. Be prepared to explain your own investing habits.

You should be prepared to discuss in detail any stocks you hold, why you hold them, and several key details about each company. If you own mutual funds instead of individual stocks, you should be prepared to discuss (and defend) your selection process. If you don't have any investments, be prepared to explain that, too. And yes, saying you don't have funds available to invest just yet is okay. If you're a member of a 401(k) plan, know what that's invested in (see, you do have some investments after all). If you don't have any of these, give yourself an imaginary $1,000,000.00 and invest it on paper,  and explain how you've decided to make your "purchases" and what would make you "sell".

This is all part of the Ask The Headhunter approach of "doing the job to win the job", and it's critical in an interview.

The investment business is grounded in good communications, and I'm dead serious about this advice, no matter how corny it may sound. Brush up on your telephone skills. Most investment business is transacted over the telephone, and you'll have to have a great telephone manner, even when you don't feel like it. You can start practicing with the first call you make to a company. Good grammar, efficient delivery of your point (be brief!), and a professional manner are necessary. Don't waste the person's time. Have your "script" ready and don't deviate unless necessary. You'd be surprised at the long memory of most receptionists. They're professionals too, and answering the phone is their job.

Try this: "I need to speak with the person in charge of trading [just an example]. Who would that be? And what is his/her exact title? And how do you spell that name?" (You'd be surprised at how many ways there are to spell the name that sounds like "Smith"). Once again, accurate communication is critical, and nothing tells a manager more about your ability to communicate than your failure to spell or pronounce her name correctly. Your next mistake might be with a client, and it might cost the firm money.

Finally, do not ever call anyone in this business while the market is open. I had someone call me once at the market's open to ask about potential employment. I figured if they didn't realize how swamped I was at that time, they didn't really have a clue as to what the job entailed.

This may seem obvious, but make sure you mention every license you have. If you've worked in the insurance business, for example, mention your insurance license. It counts. If you don't have any licenses, be sure the interviewer knows that you are ready and willing to prepare to get whichever ones are required.

Here's the catch-22: most jobs will require a Series 7 license (Registered Rep). You can't get this license without being employed by a firm that is qualified to sponsor you. However, you can get the study materials at your own cost and be prepared to take the exam at once (see below). While the firm may still want you to take their own prep program, walking in the door and showing that you've already studied the material is very impressive. It tells the firm that you've made a serious investment already, and this could put you over the top when competing with other good candidates who have done no prep at all.

Preparation & Training Materials
Licenses are required for professional investment jobs, and you must be employed and sponsored by a registered investment company before you can sit for a test. However, there are many "prep course companies" out there which are glad to sell you the training you'll need if you really want to take it in advance. One of these is the Securities Training Corporation (however, this is not an endorsement of any particular company). You'll find others by searching the Net or by asking brokers you know.

Many firms are also particular about which study course you take. They have their favorites (probably based on quality, cost and how much time the training requires you to be out of the office), so I do not necessarily recommend that you get these ahead of time. You may wind up spending your own money, only to have to study the material again in another training program. (See the section above for one very good reason to pursue your own training.) Most investment firms have study materials available in-house. These are sometimes leftovers from those who've previously taken the exams. Depending on whether you purchase books, video tapes, computer-based training or classroom training, the cost can range from about $250 - $350. This is definitely something that can wait until you're hired, as you do have to be sponsored by an eligible firm to even take the test. Larger firms will also probably provide you with some extensive in-house training as well.

One word of caution: beware of borrowing someone else's study guides if they're more than a year or so old. The composition of the tests changes frequently, with shifting emphasis on each area that's covered (i.e., options, compliance, etc.), as do the underlying securities laws and regulations.

Most transactions in the investment industry are built on a foundation of good faith between the transacting parties. Your word is your bond. One slip-up will ruin your reputation. If you haven't read about any of the high-profile shenanigans in the industry, go look some of these up, and you'll see how hard the industry (and the SEC) comes down on dishonesty. Guard your integrity and your reputation for fair play with your professional life. This begins with not lying in the interview or on your resume. Firms in this business can't take a chance on someone who appears to be dishonest... you are handling other people's money in some form every day.

Forget The Interview Tricks
One young woman I interviewed for an assistant's position was quickly disqualified when she asked "What do I have to do to get your job?". I'm sure she thought she was being the poster child for ambition and drive, but the message I got was that she was not really interested in the position I had available, and wouldn't be there long even if I did hire her. Many firms start even the most qualified applicants at a lower position to gauge how well they "fit". So think twice about using "clever techniques" to convince the employer you're executive material. What counts most is your forthrightness and your understanding of what the manager needs from you.

Rats! I Forgot To Get An MBA!
An MBA does not guarantee a job. Many firms now look favorably at the CFA (Chartered Financial Analyst) designation, but they also look favorably at those with a well-rounded liberal arts  background.

The main thing an investment firm is looking for is a candidate with a true interest in the investment industry who is personable and willing to learn.

Minimum Requirements
If you don't have basic math and English skills, don't even bother to look into this industry except at the very lowest levels. You'll need these skills every single day. Basic computer skills are also a must.

Finally (don't chuckle), good manners are also essential... get those elbows off the table! In many cases, you're dealing with wealthy, educated, cultured clients and employees of your firm. Whether you end up on the buy side or the sell side, at some point you'll go out to dinner with your client or salesman. They will pay attention to how you comport yourself.

One topic that bears special mention: drinking. Know your limit before you get together for lunch, dinner or "drinks" with the person who's considering hiring you. When you're demonstrating the integrity and good judgment that are critical in this business, the last thing you want to do is get a good buzz on.

How To Keep Succeeding
Once you get into the industry, strive to be a general specialist. With all the mergers in the investment industry today, those that stick around will be the people who can do more than one thing well. Always be willing to expand your knowledge, skills and contacts by getting involved in projects outside of your department's bailiwick. For example, if you're looking for a position as a portfolio manager, you'd do well to know how the trading department works, and what SEC compliance standards are for ownership. This is mostly learned on the job... but pay attention, and invest in your future!

Lisa Locher has spent fourteen years in the investment management industry, having most recently served as Vice President and Head Trader for a private institutional investment management firm. She has also served as Head Trader for a limited partnership and a mutual fund. Lisa is a member of the National Organization of Investment Professionals, a member and former officer and director of the Security Traders Association of Washington DC, and is listed in Who's Who in Finance and Industry. She is currently taking a break from the business world to stay at home with her first child, who is becoming addicted not to Teletubbies or Barney but to CNBC, thanks to his mom. Lisa may be contacted through The Headhunter, who will forward email.


The contents of this site are Copyright (c) 1995-2015 North Bridge Group LLC.
All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without prior written consent. Ask The Headhunter, Fearless Job Hunting, the ATH logo and other ATH titles are trademarks or registered trademarks of North Bridge Group LLC and Nick A. Corcodilos.

User agreement, legal information and disclaimer.

Visit the Ask The Headhunter Blog and sign up for your free subscription to the weekly Ask The Headhunter Newsletter.

We welcome comments and
suggestions. Please email to
Ask The Headhunter.