Asset Management
Prepalyst has 21 equity portfolio management interview questions with model answers, covering business quality, position sizing, benchmark risk and turnover discipline. Every question is graded on technical accuracy, completeness and interview communication. Practice is free.
A first-round question for analyst programmes at long-only equity managers.
Before buying a single stock for an active equity fund, what do you need to know about its benchmark, objective and constraints? Why is a benchmark not simply a scorecard?
A foundational screening question for analysts joining benchmark-aware equity teams.
An equity index contains only three freely tradable companies: A has a free-float market capitalisation of $500m, B has $300m and C has $200m. Calculate each index weight. Why do most broad equity indices use free-float…
A practical valuation check in an equity-manager analyst interview.
A portfolio has three holdings: 50% in a company trading at 10x forward earnings, 30% at 20x and 20% at 30x. Calculate the weighted-average forward P/E. Then explain why that number alone is not enough to call the…
A first-round calculation that tests whether a candidate can describe a portfolio decision relative to its benchmark.
A global equity fund owns 6% in Company X, 1% in Company Y and 0% in Company Z. Its benchmark weights are 3%, 4% and 2%, respectively. Calculate the active weight in each name and explain what an underweight means in…
A basic calculation and interpretation check in equity research and portfolio-management screens.
You buy a share at $100. One year later it is $108 and it paid a $3 dividend. The company’s EPS rose from $5.00 to $5.40. Decompose the shareholder return and explain what you would investigate next.
A deceptively open question testing whether you ask before you answer.
How would you invest $1 million? Walk me through your thinking.
Common at benchmark-aware long-only managers assessing whether candidates understand active risk.
Define active share and tracking error. A fund has 85% active share but only 2% expected tracking error. Is that contradictory, and what would you examine before deciding whether the manager is genuinely active?
You are interviewing at an active manager. This question is not rhetorical.
Most active managers underperform their benchmark after fees. Why are you pursuing a career in active management? Make the strongest case, and acknowledge the strongest counterargument.
Asked to test whether you can hold a nuanced view on a politicised topic.
Should ESG factors be part of a fundamental investment process? Make the case on investment merit rather than on values.
Guaranteed in every asset management, equity research and long/short interview.
Pitch me a stock. Structure your answer as you would in an interview, covering thesis, valuation, catalysts and risks.
Standard in quantitative and multi-manager interviews.
Define the Sharpe ratio. What are its limitations, and what would you look at alongside it when evaluating a manager?
Common in research and growth investing interviews. Assume no internet access.
Estimate the annual revenue of the US coffee shop market. Show your reasoning, then tell me which assumption your answer is most sensitive to.
Tests whether an equity analyst can turn a headline beat into a tradable, falsifiable view.
A company beats quarterly EPS by 6%, but management keeps full-year guidance unchanged. The share price rises 9% on the day. How would you decide whether to add to a position, hold it, or sell into the move?
Tests your investment philosophy. There is no formula, but there is a right structure.
What makes a business high quality? How would you assess whether a competitive advantage is durable?
A practical portfolio-management question about converting research into net client returns.
An analyst proposes selling a 4% holding to buy a new idea expected to outperform by 5% over the next year. The round-trip trading cost is 70 basis points, and selling would realise a 20% taxable gain for taxable…
An offer-level portfolio-management case on treating redeeming and remaining clients fairly under liquidity pressure.
Your long-only equity fund receives a 12% redemption request to settle in five trading days. Its 8% small-cap holding trades only 5% of its average daily volume without material market impact; its large-cap names are…
Distinguishes candidates who think about portfolios from those who only think about stocks.
You have 20 high-conviction ideas. How do you decide position sizes? Discuss concentration versus diversification, and how correlation affects your decisions.
An offer-level case for fundamental investors, where process matters more than sounding brave in a drawdown.
Your fund owns a 7% position in a consumer company because you underwrote stable pricing power and margin expansion. A major competitor cuts prices, the company misses earnings, and the share price falls 28% in a week.…
The analytical core of fundamental investing. Expect it at quality-focused shops.
Define ROIC and explain how it relates to growth in creating value. When does growth destroy value? How do you decompose ROIC to find out what's actually driving it?
A long-only portfolio-management judgement question about letting winners run without allowing a position to become an unmanaged risk.
A stock you bought at a 3% portfolio weight has doubled and is now an 8% weight. The thesis remains intact, but the valuation is above your base-case fair value. How would you decide whether to trim, hold or add?
An evidence-weighting exercise that makes confidence explicit before the recommendation.
You are reviewing a consumer compounder after a profit warning. Allocate 100 confidence points across bullish, bearish and unresolved explanations as evidence arrives, then make a position recommendation.
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Firm names indicate where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with the firms named.