Company overview An equity research analyst position entails providing analysis on securities information to portfolio managers to aid in the investment process
An equity research analyst position entails providing analysis on securities information to portfolio managers to aid in the investment process. Understanding the securities industry to successfully interpret data. Ability to quickly read financial income statements, balance sheets and other key summary report statements issued by publicly traded companies as a means of surmising the valuation of equities. Also, be tasked with interviewing managers, suppliers, customers, and even competitors, to collect data. Being an equity research is a pivotal role as it involves the responsibility for providing information to business management, which is then used in making important investment decisions. Equity research analyst exists for a long period and not an innovator. What an equity research analyst does from duties and tasks is close to what has been studied. Dana Alghoneim is my supervisor. I communicate with her directly, and she is senior investment analyst has a long experience in this field. She helps me especially in a new thing, I try to take advantage of her experiences and she is a personal collaborator.
Ashmore Group is an investment company specializes in emerging-market investment management based in United Kingdom-London and has local asset management branches in key emerging markets. Ashmore Group’s office in Riyadh is a part of its network of offices in Brazil, China, Colombia, India, Indonesia, Japan, Singapore, Turkey, and the United States. Ashmore Investment Saudi Arabia provides manages investment funds, manages client portfolios and investment advisory. The company manages a wide range of different equity, debt, and regional investment strategies. Ashmore’s investment funds consistently outperform global benchmarks because of its unique focus on emerging market economies, which offer higher returns to investors comfortable with increased risk.
Ashmore Investment Saudi Arabia is a closed joint-stock company and it is directly owned by Ashmore Investments (UK) Limited. Ashmore Group is a public listed company and a constituent of the London Stock Exchange. Thus, all of the key company data is public information and therefor easily obtainable.
Ashmore’s history goes back over twenty years in the United Kingdom, which has been established in 1998 by the current chief executive officer Mark L. Coombs. The company exists in its current form following a management buyout of the group from ANZ Grindlays Bank in 1999 and was taken public in 2006. Ashmore Investment Saudi Arabia established in 2014, and the company commenced business on 28 September 2014.
Ashmore group’s current market cap is £2.51 billion with 713 million shares outstanding as of 06/10/2018. Their last annual earnings report ended 30/06/2018 witnesses an increase in operating revenues by 11% year over year to £278.3 million, and the number of employees as of today is 253 employees. Ashmore Saudi Arabia has a capital of SR 50 million and has 14 employees. This is low compared to other competitors in the financial services industry of a similar scale and is a function of Ashmore’s business model of maximizing investor returns by minimizing costs.
Ashmore is composed of eight business units -alternatives, operation, legal, finance and risk, distribution ; investment advisory, portfolio management, compliance ; AML, and corporate finance- all headed by a Managing Director Dr. Abdullah Alshwer. I worked in portfolio management department and It is one of the main departments in the company the staff in this department called investment analysts, responsible for assisting clients such as companies and individuals with investment decisions and needs to look for investment trends and try to predict the best investment opportunity for customers.
Industry overview and major challenges
Ashmore group operates in the financial services industry and the sub-sector is Asset Managers. Financial services industry is services performed by financial institutions and accredited by the Capital Market Authority, this sector includes banks, investment funds, real estate brokers and insurance companies, among others. This field has one thing in common, they are all involved in the business of managing either proprietary or client capital to generate positive returns – both for their investor clients and the firm itself. Globally, the financial services industry leads the world in terms of earnings and equity market capitalization.
Following the 2008 financial crisis, the industry is facing many challenges and concerns, many of which stem from the increased regulatory focus on capital requirements and credit default risks. Compliance departments’ work alongside investment professionals to protect investors and ensure that markets are fair, efficient and transparent. They ensure that government directives regarding anti-money laundering and anti-fraud initiatives are properly implemented and play a key role in reporting wrongdoing and monitoring systemic risk. From an investor standpoint, this is critically important in the Middle East region. Another challenge facing the financial industry is the increasing demand for sustainable performance and consistent market-beating returns through the provision of more sophisticated financial products and derivatives. Globalization has created a borderless world, and increased capital mobility has vastly increased the number of players within the investment industry. As a result, any financial services company that accepts any funds from the investors with the goal of generating returns is considered to be a competitor in the financial services industry. All of the equity funds-local traded in Tadawul are considered competitors of Ashmore especially Al Rajhi Capital, Saudi Fransi Capital, NCB Capital Company, ALBILAD Investment Company, and HSBC Saudi Arabia.
In the equity, department is highly cyclical, and not really based around ‘daily’ tasks, anyway every day I have to know what is happening in the Saudi market (TASI index) in addition to the companies listed in it. And up-to-date knowledge of financial services industry happenings and current events. Conduct primary research from industry sources.
My project required the construction of a detailed financial model and forecast for Saudi Company for Hardware (SACO) of the retail sector. My main task was to analyze the company management and their financial position to help the asset management team to calculate the intrinsic value of the company and decide whether to participate in the company equity offering or not.
I heavily relied on the Microsoft Excel program to collect and analyze the data throughout using many valuable tools and equations. For instance, using the mathematical properties of the time value of money. Building the model and using Excel features have helped me a lot reflect what I have been studied in my bachelor’s degree with the real live worked experience, it becomes much easier to use Excel program in such a fast and efficient.
I completed financial models update, financial model input and forecast, gather information on a company under research and maintain the quarterly estimates (sell side) forecast and continues update.
I did not face any problems or challenges until now. I worked with a nice team all of them help me not just my supervisor.
I became more proficient in Excel program throughout using many valuable tools and equations, I now use Excel much fast and efficient manner. Coordinate tasks with teamwork and other departments led to the development of communication skill.
This month I succeeded in knowing how to work in the equity department, financial model input and forecast process. I hope in the future that I will have full knowledge in the equity department.
Of my duties next month are finish valuating SACO company, analyze one more company and keep updating the models. And there are unspecified duties until now.