I am working as an equity research analyst for the last 4 years in a small boutique firm in Mumbai and recently attended an interview for an equity research position in JP Morgan .One of the interviewer asked me whether I can suggest him any stock to buy which he wants to hold it for a minimum 5 years time from now. I was really struggling for an answer; from the panel of interviewers another guy asked me, whether I would first of all suggest smallcap, midcap or largecap stock? Hey guys what do you think is the right answer?
Hey Arun,I am about to attend an interview in JP Morgan in a week’s time, am very much eager to know what other questions they asked you? How many rounds of interview were there etc? Please let me know your contact details –thanks in advance
I was totally blank, so I just answered would suggest from largecap stock, for that another panel member asked me, is it possible to foresee anything after 5 years? Or you an astrologer .I just laughed and had nothing to say
Yah Arun ,understand in a interview situation ,even the answers we know we can’t answer and forget about such tricky simple questions’ think with so much uncertainty its difficult to make predictions for 5years term, if they ask me I will answer like that. Any other question you remember?
They asked me why you think DCF is not a good model. To get the flow, I initially started answering how DCF is good and thought could recollect the negative points of DCF and say that in the latter part of discussion, but one of the panel members cut me short and said, Arun the question is why it’s not a good model, anyway, as an analyst how do you assume the growth rate and reinvestment rates for a start-up company valuation?
Oh I see----if the question is just about growth rate or reinvestment rate, you can give generic answer but when they suddenly ask specific questions relating to start-up etc how do you spontaneously come out with an answer, unless you have really done a valuation for a start-up company. These questions just look like filter mechanism!!!! Tough guys
Hey Arun, listening to your experience, I am seriously thinking whether to attend this interview next week with JP Morgan. Without seriously preparing, there is no point in going to the interview but the billion dollar question is how to prepare? Which books are there specifically for interview preparation for equity research or investment banking roles?