With the development of global economy, the financial industry has seen rapid growth in recent years. As one of the most popular positions, investment analyst has attracted many young talents. However, the entry level salary of investment analysts varies greatly across firms and sectors. This article will analyze the key factors that determine the salary level of entry level investment analysts, and provide actionable suggestions on how to maximize your earning potential in this career path.
Educational background determines the entry level investment analyst salary
The educational background of investment analysts directly affects the base salary they can get. Undergraduate majors like economics, finance, accounting, mathematics and statistics are most welcomed. Graduates from top universities especially Ivy League schools are highly valued and can earn 25% more at the beginning. Advanced degrees like MBA, CFA and FRM certifications indicate stronger financial modeling skills and get you higher offers. But work experience and internships still outweigh education level when firms make salary decisions.
Prior internship experience boosts investment analyst entry level salary
Completion of internships at reputable financial institutions gives candidates a huge pay advantage. Employers tend to offer full-time positions to those who have already worked at their companies. Interns are familiar with the firm’s workflow and culture, requiring less training and adaptation time. Having internship experience also proves the applicant’s interest and competency in the field, making them more qualified for higher salaries.
The firm size and rank decide investment analyst entry level pay
Bulge bracket investment banks like Goldman Sachs, JP Morgan and Morgan Stanley offer the highest starting salaries to entry level analysts, ranging from $70,000 to $90,000. Mid-sized investment banks pay around $60,000 – $70,000. While small, boutique firms have lower compensation around $40,000 – $60,000. The base pay at top hedge funds and private equities can exceed $100,000. But larger, more prestigious firms also demand longer hours and higher productivity.
The sector and location of the firm influence investment analyst salary
Investment analysts specializing in lucrative sectors like M&A, sales and trading enjoy higher base salaries. Investment banks in major financial hubs like New York and San Francisco pay more to offset the higher living costs. For the same position, an analyst in New York City can earn up to 30% more than someone working in secondary markets like Chicago or Houston.
In summary, the entry level salary of investment analysts is determined by education, internships, firm size and sector specialty. Graduates from elite schools, with relevant internship experience, working at top investment banks in M&A or sales can earn over $90,000 a year initially.