Investment Management Interview Questions

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Date Submitted: 02/22/2012 02:06 PM

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Investment Management Interview Questions:

N.B. IM interviews, like most other industries, will most likely involve a “get to know you” portion (~10 minutes or less) that involves a discussion of your resume, background, experience at Kellogg, etc. This will quickly give way to IM-specific questions like those posed below:

1. So what is a stock I should buy (short) now and why?

- This is the “Pitch Me a Stock” portion of the IM interview. BEFORE walking into an IM interview you should:

a) Choose at least 2 stocks to buy & 2 stocks to short

b) KNOW these companies

a. Major ratios

b. Comparable companies

c. The competitive landscape of the industry in which these stocks reside (basically a Porter’s 5 Forces exercise)

d. Build your own model, including income statement, balance sheet & cashflow statement. This will FORCE you to get to really know the company, its drivers, major assumptions and greatest risks.

e. Know the opinion of the stock on the Street and how your opinion either agrees or dissents with the consensus.

f. The effect of macroeconomic factors on the stock & its industry.

g. Major news events in the sector.

TIP: If you pick a well-known, widely covered stock it will certainly be one on which the interviewer has some sort of opinion even if he/her does not cover the stock. While this will certainly allow for a fluid discussion, it will ensure that you have to be CONFIDENT in your knowledge of the stock. Picking an obscure stock is a way for you to show your explanatory powers and lessen the chances that the interviewer knows everything there is to know about that stock. However, this might also work against you as the interviewer might lose interest in the story.

REMEMBER: They are attempting to assess:

1) How much you prepared for the interview.

2) If you can think quickly on your feet....