The Quantitative Research team has been on the decline for over 15 months now. One of the main reasons for that is the current management team.
It is a young team that got promoted early with little applied experience after several experienced people left Morningstar. Though promotion from within may sound attractive, it is mostly done to keep costs low. The main detriment of this is that the team’s collective knowledge remains low and you get inexperienced managers who chase titles and develop inflated egos. Also, the associates don’t have much to learn from these people leading to understandable frustration and lack of true career progression (experience rather than titles). When interviewing, remember that you should also take the time to interview the interviewers and gauge for conceptual understanding. The management team does not truly understand what quantitative research and machine learning are but are well versed in buzz words.
Many of the managers are part of a clique that continue to support and promote each other for their mutual benefits. Over time you will notice that the allocation of work and promotions will be heavily skewed to them. These people without due process and proven experience get promoted to inflated titles of Associate Director and Director. This is mostly done by posting fake internal jobs that are created and closed immediately after the intended applicants apply. They talk openly about their private WhatsApp group, relationships with each other, and how they conduct meetings and make decisions at each other’s homes. The intention behind the clique is clear. Promote each other and spread within Morningstar so that you have allies throughout the company. This is great for them but really bad for the team because you feel that their personal ambitions are more important than the team’s health. The team has lost trust in management because you can not provide honest feedback and criticism to the members of the clique and when you do, no tangible change occurs.
Over 35% of the team in Chicago and Mumbai have left Quant and/or Morningstar over the past year. Please ask during the interviews what the attrition rate of the team is and whether you are a backfill. It’s a major sign when many people are leaving and there is very little growth. Management continues to market it as that the team is very qualified and that tech companies are stealing them away. They choose to blatantly ignore the reasons why the team started to look for opportunities outside in the first place. After several consecutive negative Net Promoter Scores (NPS) and performative feedback collection processes, no change happened besides tenured people leaving. So if the NPS starts to improve, think about why that is and how long till the recent hires realize the problems as well and the NPS scores start to drop again. Human Resources is aware of this trend but either continue to believe the marketing that the management team does or are choosing to ignore it.
As a Quant Analyst, you will get well versed in Morningstar data and some SQL but don’t expect to gain any transferable skills related to what an industry Quant Analyst does that you can use outside of Morningstar. As a Software Engineer, be prepared to be isolated and not have other engineers to work with or learn from. Additionally, be prepared to be managed by non engineers who can’t provide you with career development and won’t educate themselves on how to do so. In order to cut costs, this team pushes wearing multiple hats to an extreme, leading to subpar applications that have limited (or no) use within Morningstar.
The team may be called Quantitative Research but there isn’t any machine learning or statistical based research being done. There are a few models that the team built several years ago that need to be maintained. Many folks with Data Science and Quant Finance backgrounds have come and left because they were being used to pull data and write data loading scripts. Again, the management themselves have not done this work but are the ones who dictate what work should be done which is counterintuitive to how a research team should be led. Ask the interviewers what the planned projects are and how you would be contributing to them. Try to gauge how concrete these plans are.
There’s plenty of reviews about the lower compensation at Morningstar relative to other companies seeking similar skills so I won’t mention that. But I would like to say that within Morningstar’s Research organization there are pay differences as well. On average, Quant gets paid lower than the Equity Research and Manager Research departments. Something to remember when considering Quant is the cumulative effect of lower compensation over many years relative to your peers who chose the other research departments. Additionally, the tradeoff that most people make at Morningstar for lower compensation is a better work life balance. Within Quant, that is not possible. The management sets the tone. When they are constantly messaging and emailing in the evenings and on weekends, it’s hard for you to draw a boundary for yourself. You will feel overworked with little benefit from it.
I write this is for all those coming excited out of undergrad or from their PhDs. I want you to know what the team structure and career prospects are so that you can be aware of what you’re getting yourself into and consider this if you are between offers. I know people who started recently who wish that they knew this information. A job is a significant part of your life and getting out of a bad one after recently starting is very difficult. I want you to be able to make an informed decision and not be blindsided.
