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I’m an equity researcher. Someone asked me to work for free

Pay in equity research

Join the chain gang

You know when the job you’re doing in financial services is falling out of fashion – people around you start disappearing, you’re paid less, the head of your department stops doing deep throaty laughs in your presence and looks at you like you’re a huge cost base. But however crappy it gets you’re usually paid something if you’re in work. Except in equity research.

As an equity researcher, I attended a job interview where they were offering to pay me nothing at all.

The interview wasn’t with a major bank. Although banks’ research teams are being squeezed by MIFID II, banks still know better than to pay nothing. It’s the ‘equity research boutiques’ you want to watch for.

I interviewed with one of these boutiques. It was founded by a bunch of senior equity researchers from a mid-sized bank who’d been dinged and decided to monetize their research by selling directly to clients. Great idea – except they didn’t have the cash flow to cover my salary as a new hire, and so they asked me to work for free.

The idea was that I would do six months for no pay. The rest of them drew salaries for a commission sharing agreement where they got a proportion of the research they sold. They figured it would take me three to six months to get up speed – first I’d have to produce something, then I’d have to sell something, then someone would actually have to pay for that. After six months they assumed I’d be a fully functioning member of the team.

The worst part of this story isn’t actually the fact that I was asked to work for nothing though. The worst part is that I accepted, and then they rejected me after having second thoughts about the fact that I wasn’t ranked in the top 10 by Extel. They wouldn’t even give me a job if I worked for free.

I can’t help but feel that this should be a warning to equity researchers everywhere. Ok, I’m not a top ranked equity researcher. But nor am I bad equity researcher. I’ve made some good calls and if I’m not ranked, that’s as much to do with the market and to the difficulty finding a good equity research seat now as anything else.  Equity research is the worst job in finance: I could earn more on a building site. The situation is already bad and can only get worse under MiFID II. Personally, I’m trying to leave research behind and make it in Fintech  – although that seems to involve a lot of free labour too….

Owen Morgan is the pseudonym of an equity researcher in London.

Contact: sbutcher@efinancialcareers.com

Photo credit: the anchor chain gang by Natalie Greco is licensed under CC BY 2.0.

Comments (1)

  1. Family offices are hiring researchers in house, tired of paying high fees to custody/ mgmt fee focussed asset managers.

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