Should you pursue an internship in wealth management or private equity? Here’s what you need to know to make an informed decision.
As a summer analyst in wealth management, most of the day-to-day deliverables consisted of working with bankers and investors in preparation for upcoming client meetings. We interns put together a book with the client’s updated assets, investment returns analysis and other relevant portfolio information. We had to stay informed about key market events that could come up in client meetings, and we would often discuss how those events could affect the client’s investments at the bank or the business they worked in.
As an analyst at a small PE firm, deliverables depended on the deal the team was working on. My tasks included financial analysis of portfolio company performance, writing memos for investors and conducting market research for potential investments and due diligence.
One of my favorite parts of being a wealth management summer analyst was having the opportunity to attend client meetings and engage in discussions about the markets and clients’ portfolio. I had to make sure I understood the key parts of their portfolio and how the firm’s active management could help the client with their goals. I made sure to research the client’s company to learn about key events at their firm and market events that could affect their business sector.
For example, as equity markets reached all-time highs over the summer, clients consistently asked about whether now was the right time to invest in equities as opposed to other classes. I always felt prepared to answer this question with reasons that directly pertained to that specific client’s portfolio.
In PE, the market research I conducted was focused on potential new investments. If the firm was looking to expand their investment horizon to new trends in the financial industry, such as up-and-coming fintech companies, I researched market trends, competitive forces in the industry, and the responses of incumbent firms.
However, if the firm was looking into an investment opportunity, I often had to research risks and catalysts for the geographic area in addition to the potential portfolio company to assist with due diligence. Analyzing demographic data, industry-specific data, and information on public comps trading in the space helped a great deal with providing value to the deal team.
In PE, every day as an analyst required having an arsenal of quantitative skills. Regression analysis, working on sensitivity analysis for potential deals and understanding the intricacies of models with 20-plus tabs were keys to adding value as an intern.
I helped with updating portfolio company valuations in preparation for quarterly investor memos, which often meant creating multiple comp sets, analyzing precedent transactions and assisting the deal team with whatever else needed to be done.
The qualitative portion was important too, as was having attention to detail and learning to write efficiently for investor memos.
It’s important to fully understand the nature of the role the firm is looking for you to fill before accepting an internship offer.
The PE firm I worked with focused on growth equity investments, and the work you do in that space will differ from working as an intern at an LBO shop or a VC firm. Even within growth equity, some firms might place a larger emphasis on interns sourcing as opposed to completing due diligence or monitoring portfolio companies.
In wealth management, large firms will often organize groups around the spending habits of clients or the industry in which they work. Therefore, the work you do may differ if you cover founders/entrepreneurs as opposed to PE principals.
There could also be different teams within the larger group that could make your role very different, such as supporting bankers versus investors on a regular basis.
For wealth management, I think it is equally important to be passionate about the area of clients you will be supporting so you can truly get to know and understand the space.
Meagan Loyst is a student at Boston College and Incoming Summer Analyst at General Atlantic. Previously, she interned at J.P. Morgan, Citi, the hedge fund firm Perry Capital and the private equity firm BayBoston. Loyst participated in the Girls Who Invest program at Wharton.