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www.efinancialcareers.com/students | Careers in Financial Markets 2014


41


career insight Kathy Collins


Analyst, Emerging market debt, Aberdeen Asset Management


Companies are often more comfortable talking to us on their own turf and you get an insight into ways of doing business in these countries that would sometimes be inconceivable in developed markets.


Kathy graduated with a BSc in Economics from The University of St Andrews, and joined Aberdeen in 2009.


As an analyst in fund management, you can spend much of your time trawling through company reports that stretch into 500 pages, looking through financial statements, ultimately working out how companies make money and then writing detailed credit notes for our portfolio managers. As the name suggests, there’s a lot of analysis involved, but there’s more to the job.


I work on the emerging market corporate debt team, covering


companies in Russia, Ukraine, Kazakhstan, the Middle East and Africa. We get to meet the CEOs and executive teams of a lot of companies across all sectors coming to investor roadshows in London, but there’s also a lot of travel.


Companies are often more comfortable talking to us on their own turf and you get an insight into ways of doing business in these countries that would sometimes be inconceivable in developed markets. You’re often getting to the bottom of an obscure industry in an emerging market, like a glass firm in Turkey or a Chinese retailer, so there’s a lot of learning to do on the job and it means that I’m never bored.


The company reports we analyse contain a lot of financial and legal information, so it’s important to be able to assimilate and digest information quickly.


You also need to have a sceptical outlook – sometimes there’s negative news about the companies we cover, but we have to really get to the bottom of the story and you can’t always take company statements at face value.


You don’t need to have studied finance or economics to work in fund management. For example, a geology degree could make you a good oil and gas analyst, or engineering students would be effective infrastructure specialists – it’s ultimately about understanding your subject area.


One of the more frustrating elements of the job is that you only become a good investor over time. You come out of university believing that you know a lot, but you need to have the experience of investing through market cycles to become a good portfolio manager.


In Germany, a major European centre for fund management, an experienced portfolio manager can expect $110-170k as a base salary, according to recruiters Robert Walters.


In Singapore, meanwhile, a junior portfolio manager can expect S$72-120k ($56-95k), rising to S$180-350k+ ($142-275k) at the senior end.


Skills sought


If investment banks advise clients on trading or funding decisions, fund management is more about making decisions on their behalf once they have entrusted you with their money.


Don’t expect an easy ride as a fund manager – you’ll need to be an expert at filtering large quantities of data, and to be passionate about investing. You’ll also be heavily judged on your performance: one fund manager tells us it’s like “being a student taking a test every single day and getting a grade, and that grade is published every single day in the newspaper.”


“I spend a lot of time in various types of strategy and problem solving, so I think the ability to boil things down to the critical facts is important to begin to find the right path forward,” says Barry Smith, chief operating officer of State Street Global Advisors’ Institutional Client Group and global head of cash. “Decision-making in fund management isn’t often about choosing between the right or wrong path – it’s usually about trying to choose between two equally challenging options.”


While being quantitative is undoubtedly important for working in fund management, qualitative analysis skills are also important. If, say, a negative news story caused a sudden


drop in a stock in your portfolio, you’d have to try to get to the bottom of how big an issue there really was.


“You must think critically and apply higher-level thinking when creating investment strategies and constructing portfolios. It is also important to understand market psychology,” says Christopher Alwine, head of municipal bond funds at Vanguard in the US. “You need the ability accurately to assess fundamental value to identify investment value and the associated risk/reward ratio of the trade. You also need drive because investment management is highly competitive. We are competing against the market every day and outperformance is not easy.”


While the large investment banks hire hundreds of graduates each year, the big players in the fund management world recruit tens annually. As competition has intensified in recent years, the reality is that fund managers are now expecting their graduate recruits to be more prepared for the job market than ever.


“We look for self-starters who are passionately curious about financial markets, are able to influence others effectively, and can demonstrate sound judgement,” says Arvind Sabharwal, director of equities investments, M&G Investments in London. “We value graduates who have the confidence and ability to make and stand by a decision.”


This is reflected in the high level of responsibility given to junior fund managers – all firms will run their own in-house training schemes, but an understanding of financial markets before starting in the role is a distinct advantage.


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