Typical Job Duties on the Buy Side
Analysts and advisors on the buy side are responsible for uncovering investment opportunities and making profitable stock recommendations for their clients. To be successful in a career on the buy side, individuals must have a firm understanding of financial markets, the ability to produce accurate financial models in Excel, and the expertise to make ongoing adjustments to strategy when portfolio performance demands it.
Generally speaking, buy-side analysts will conduct research into different stocks and make recommendations for investments. Managers will typically conduct the transaction themselves, ensuring that the investment aligns with the fund’s overall financial goals.
Due to the vast size of the buy-side sector, we’ve broken it down into four groups:
Asset Management: An asset manager is responsible for managing an institution’s or individual’s investment portfolio to build wealth over time.
Private Equity: Private equity firms raise pools of capital that are used to invest in private companies and gain equity interest in those organizations.
Hedge Funds: A hedge fund manager is tasked with managing the performance of various hedge funds and supporting portfolio growth through uncovering new investment opportunities.
Risk Management: Risk management is the process of discovering and mitigating potential risks that can harm the financial health of an institution or business.
Job Qualifications and Compensation Factors
Compared with the sell side, there are generally fewer entry-level positions available as jobs on the buy side often require more experience. After spending some years at sell-side banks, many individuals will transfer to the buy side and begin careers that are more analytical and quantitative.
To succeed in a career at a buy-side institution, professionals must have exceptional financial modeling skills and a deep understanding of markets. Because buy-side roles carry performance bonuses, individuals who are motivated to work long hours and ensure their investments perform well can expect to be highly compensated for their efforts.
Recommended Financial Courses for Careers at Buy-Side Institutions
Interested in gaining the necessary knowledge to thrive in a career on the buy side? CFI recommends honing your skills with our Financial Modeling & Valuation Analyst (FMVA)® Certification Program. Additionally, jumping into relevant buy-side fundamentals courses, such as our Hedge Fund Fundamentals and Introduction to Wealth Management programs, can provide the building blocks you need to develop your career on the buy side.