Financial analysts, including equity-research analysts, asset managers, and investment bankers, spend gobs of time assessing the equity of a company. However, since it persists as a kind of standard in much of the practice of financial advice, I have included it in the software. Financial institutions and advisors often charge lower percentage fees for larger accounts, but 1% is not atypical for accounts of a million dollars. Analysts tend to work the longest hours, are in the office late every weeknight and most weekends, and rarely see the light of day.
While the use of these three settings is somewhat forced in the default case, it seemed desirable to allow for a glide path in order to allow the analysis of approaches advocated by some practitioners. I have limited the possibilities by requiring the glide path to be linear, but this should capture at least the key attributes of approaches recommended by some analysts.
I am STANCO 25 Professor of Finance, Emeritus at Stanford University, recipient of the 1990 Nobel Prize in Economic Sciences and a co-founder of Financial Engines, Inc.. More than you will ever want to know about me can be found at my web site. Now the actual specifics of our novitiate’s duties and day-to-day activities will depend quite heavily on her bank’s organization and practices when it comes to Financial Analysts. At the biggest banks, an Analyst may only see her Managing Director once a year in the distance, like some mythical unicorn, and only read about her clients in The Wall Street Journal.
Still other banks will put her in a large analyst pool, where she will be one of many analysts loaned out on a case-by-case basis to support bankers from different groups across all of corporate finance and M&A. Despite the Great Recession and severe financial problems in several of California’s cities, many metropolitan areas of California experienced actual job growth (see chart below).
Analysts work under close supervision by Associates (the next rung up) and sometimes Vice Presidents, who supply the content of each presentation or related work product (at the direction of their superiors) and who check the Analysts’ work for completeness and correctness. It is extra good if she is innovative and comes up with new ideas for doing things, better financial models, or even a clever suggestion for something even her MD has not thought about on a deal.