The analyst role

An analyst is typically assigned a sector or a list of names — perhaps twenty to forty to monitor and five to fifteen with live or potential positions. You are expected to know these companies better than anyone on the sell side.

Research combines reading filings and transcripts, building models, talking to management, customers, suppliers and former employees, and gathering data — web traffic, pricing, credit card panels. The goal is a differentiated view on the variable that will move the stock.

Analysts recommend and PMs decide. A good recommendation includes size, conviction, upside, downside and the risk it adds to the book. PMs think in risk units, so expressing a trade in terms of expected value and downside makes it easier to act on.

Mornings start with news and pre-market moves. Earnings seasons compress the work: preview notes before results, rapid analysis after, and a recommendation to add, trim or exit. Between seasons, analysts deepen research and look for new ideas.

Analysts are evaluated on the P&L of their ideas, the quality of their research and how well they update. Admitting a broken thesis quickly is valued; anchoring on a losing position is the fastest way to lose a PM's trust.