Examples Of MM L/S Ideas

Based on the highest ranked content on WSO, here's how you might approach a short-term L/S pitch for a multi-manager (MM) fund, often referred to as a "pod-shop":

Fictitious Examples of Short-Term L/S Theses:

• Long Thesis: A tech company has just announced a revolutionary product that is expected to capture significant market share within the next quarter. The company has a strong track record of successful product launches, and early sales figures are exceeding expectations. The pitch would focus on the immediate revenue impact, market sentiment, and potential for upward earnings revisions.

• Short Thesis: A retail company is facing declining sales due to increased competition from e-commerce platforms. The upcoming quarter is expected to show a continuation of this trend, exacerbated by poor inventory management leading to discounting and margin compression. The pitch would highlight the expected negative earnings surprise and deteriorating fundamentals.

How to Word the Pitch:

• Be concise: Clearly state the investment thesis, expected timeframe, and key catalysts.
• Use data: Support your thesis with recent data points, such as earnings surprises, sales growth, or market share changes.
• Articulate risks: Briefly discuss the main risks to your thesis and how they are mitigated.

Common Mistakes in L/S MM Fund Pitches:

• Overcomplicating the Thesis: Keep it simple and focused. Avoid getting lost in unnecessary details that don't directly support your main argument.
• Ignoring Risk Management: MM funds are particularly risk-averse. It's crucial to show that you understand the risk/reward profile and have a clear plan for risk management.
• Lack of Conviction: Be confident in your pitch. If you don't believe in your idea, it will be hard to convince others.
• Timing Issues: For short-term pitches, timing is everything. Failing to clearly define the expected timeframe for the thesis to play out is a common oversight.

Remember, the key to a successful pitch at a MM fund is to be clear, concise, and to back up your thesis with solid data and a well-thought-out risk management strategy.

Sources: Qualities of a Great Investor, MultiManager PM (Millenium, Balyasny, Schonfeld) minimum requirements, https://www.wallstreetoasis.com/forum/hedge-fund/advice-on-hf-recruiting?customgpt=1, Post-MBA Recruiting At Top Asset Managers / LOs, Stock Pitch Sample Template - Proven Examples to Help Ace Your Interview