Advice for Incoming Structured / Securitized Credit HF Analyst
Hey all - wanted to tap into this forum for advice / guidance on how to navigate HF land...
By way of background: started in buyside (private) CRE out of undergrad and landed an analyst seat at a structured credit HF (don't ask me how - scratching my head too). The shop invests across the ABS universe, but with my CRE experience I'd probably be focused on the CMBS portion of the book (will have opportunity to learn about other products as well)
All that to say, I feel like a massive imposter and wanted to see if experienced ABS traders / PMs here had some advice. Two concerns: (1) the fact that I don't have traditional sell-side experience and (2) how I don't have a quantitative degree (typical RE background... wish I had studied math / stats / CS instead given how much I liked math as a kid + the rigor behind these degrees).
Unsure if these concerns are warranted, but wanted to ask a few questions:
- Will the lack of sell-side experience hurt me? If so, how to compensate?
- Do I need to learn higher level math? Am aware that no one uses calculus in the day to day, but figured having comfort in the math (at least until calculus and beginner stats) could facilitate "deeper" understanding in key fixed income and risk management concepts. This has always been a major insecurity of mine and something I'm actively trying to address
- Any advice on how to survive / thrive in HF land? Things I should and shouldn't be doing? Recommended readings related to ABS? Willing to do any and everything
Thanks in advance!
Based on the insights from Wall Street Oasis, here are some tailored pieces of advice for someone transitioning into a structured credit hedge fund (HF) role, especially focusing on the CMBS sector:
Lack of Sell-Side Experience:
Learning Higher Level Math:
Surviving and Thriving in HF Land:
Addressing Insecurities:
By focusing on these areas, you can effectively bridge any gaps in your experience and build a strong foundation for a successful career in hedge funds. Remember, the unique path you've taken to get here also provides you with a unique perspective — a valuable asset in the diverse world of hedge funds.
Sources: Q&A: 2nd Year Equities L/S HF Analyst in Hong Kong, L/S Credit HF Analyst - Q&A, Navigating Distressed HF space and recruitment, Hedge Funds requiring IB experience... why?, Q&A - research analyst at credit hedge fund
Im not in ABS, but a different mathy/quant field. So on that front, most of it isn’t that complex. So you can mostly likely get by without fully understanding the details, especially because in finance there’s so much simplified documentation.
But especially because you have the insecurity/interest, learning the details is really good, because it means people can’t big dog you on it. I.e. a common example with derivatives pricing, they’ll ask “you know about the greeks, right?” And they’re not complicated, so you either bluff and say yes and they catch you saying something dumb or not following, or say no and look dumb. You don’t need a PhD, but enough knowledge to establish others confidence in you.
That makes sense - thanks for expanding. Agree on the point where you need to know just enough to be dangerous / avoid getting caught flat-footed + being more quantitative definitely doesn't hurt
Just a question of what's the most efficient way to get there... definitely a slog going through some of the math basics that aren't applicable, but necessary for calculus, stats (which ultimately facilitates better intuition in options, fixed income theory etc.)
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