Private equity firms like to hire winners. They want the elite investment bankers and graduates who can demonstrate the sort of qualities that will set them apart.
This also means getting a top-class degree from,the ‘right’ – read top – university. But an undergraduate degree is one thing. How will professional certifications and Masters' degrees help your chances?
The biggest boon to a private equity job application, perhaps surprisingly, is a Masters in Finance degree. Our figures, based on the people on the CV database, suggest that 27% of private equity professionals possess a Masters degree, compared to 23% with an MBA – the more traditional method of getting a private equity job.
Masters in Finance degrees are increasingly important for securing an investment or reporting job in private equity,” says a managing director at a Private Equity Firm. “MBAs are still important for associate level hires, but they need to becombined with experience– whether that’s PE or investment banking.”
Once again, the CFA also ranks relatively high in the alternative investment sector.22% ofassetmanagementprofessionalsonthe database have studied the CFA, and this figure is 18% in private equity.
A lot of limited partner private equity firms will hire undergraduates and then put them through the CFA. It’s rare for direct investment firms to do the same. However, we also see a lot of junior investment bankers with CFA level one, as it shows both technical knowledge and evidence of commitment.”
Mid-market private equity firms also tend to favor those with an ACA accounting qualification – who often come from the Big Four – largely because senior partners at these firms also possess the qualification. However, our findings suggest that just 2% of private equity professionals have an ACA.
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FAQs
But if you're aiming to break into investment banking, private equity, venture capital, or sales & trading, the CFA is marginally helpful at best. It won't hurt you, but there are better ways to spend your time.
Can you get into private equity with ACA? ›
Earning such certifications can expand your knowledge base and can give you a competitive edge over other candidates. Some of the best certifications for an aspiring private equity associate to achieve include: Associate Chartered Accountant (ACA)
Is CFA or MBA better for private equity? ›
The MBA is better suited to people who are more interested in general management and executive leadership. MBA career paths tend to be more popular with people in investment banking, private equity, and corporate development. MBA programs typically include a lot of networking, which is one of their main benefits.
What professional qualifications do you need for private equity? ›
Private equity firms usually look for entry-level associates with at least two years of experience within the banking industry. Investment bankers usually follow the PE firm career path as their next job and typically have a bachelor's degree in finance, accounting, economics, and other related fields.
Is an MBA necessary for private equity? ›
Although most large private equity firms look exclusively for job candidates with an MBA, you can still get into a smaller firm without one. Smaller firms prefer candidates with an MBA, but it's not always a requirement.
What master's is best for private equity? ›
There are also Master's degrees in other areas, like Economics or Management, but you're best off with Finance or the Finance track if you want the types of roles featured on this site (investment banking, private equity, corporate development, etc.).
What degree is best for private equity? ›
Many people who work in private equity have master's degrees in finance or MBAs from top institutions, so even if you can't directly enter the field after graduation it can still help you later on, after accumulating a few years of experience in a related field.
How to get into private equity after an MBA? ›
Getting into private equity directly after an MBA is nearly impossible unless you've done investment banking or private equity before the MBA. You could complete the MBA, use it to win a full-time investment banking job, and then recruit for private equity roles…
Is ACA the best accounting qualification? ›
It is generally considered both the hardest and most prestigious accounting qualification in the UK, giving those who complete it a strong grounding across all areas of accounting.
Is CFA or MBA more valuable? ›
The answers depend on your career goals. An MBA and CFA can complement each other, so earning both is worth consideration. An MBA program provides a broader education than the CFA program. The CFA focuses more on detailed topics like investment management.
Most aspiring finance professionals are seeking CFA after MBA in Finance. CFA is a financial and investment management course with worldwide recognition and accreditation. The combination of an MBA and CFA certification helps professionals grab high-profile finance jobs in leading companies worldwide.
Is private equity more prestigious than investment banking? ›
While both careers are highly regarded and financially lucrative, the choice is personal. Investment banking is typically viewed as glamorous but also requires longer hours and the sacrifice of a personal life. Private equity is extremely prestigious.
Is it hard to get into a private equity firm? ›
The potential is there to make a lot of money, even in your first year. And, the career carries a lot of prestige in the finance world. However, private equity is challenging to break into. Recent graduates compete with seasoned investment bankers and stockbrokers for a precious few job openings.
How much does the average person in private equity make? ›
What is the Average Salary in Private Equity?
| Private Equity Salary Data | | |
|---|
| 2nd Year Associate | $160k – $180k | $170k – $270k |
| 3rd Year Associate | $180k – $200k | $180k – $300k |
| Senior Associate | $200k – $220k | $210k – $390k |
| Vice President (VP) | $230k – $260k | $340k – $520k |
2 more rowsMar 8, 2024
Traditional private equity funds have very high minimum investment requirements, potentially ranging from a few hundred thousand to several million dollars. As such, most private equity investing is reserved for institutional investors (such as pension funds or private equity firms) or high-net-worth individuals.
Do you need a CFA to be an equity analyst? ›
Having a background in statistics and mathematics is beneficial for equity research analysts. Senior equity research analysts often have a master's degree. A Chartered Financial Analyst (CFA) designation, awarded by the CFA Institute, is recommended for analysts who want to move up the career ladder.
Is CFA useful for private banking? ›
Once the money is in the private bank there are other teammates who will interact with the client. For investment management, these professionals are portfolio managers (although not all private banks use that term), and for them the CFA designation is very important.
Do you need a CFA for venture capital? ›
Certification or Licensing
There are no specific certification designations for venture capital associates, but some earn financial certifications that provide them with additional expertise as they do their work. Some popular certifications include: chartered financial analyst (administered by the CFA Institute)
Do you need a CFA in investment banking? ›
A bachelor's degree and or a master's degree in a related field is often required to become an investment banker. Investment bankers often start their careers as analysts and do so by earning the CFA charter. Independent investment banks often pay higher bonuses to entry-level investment bankers.
