Path to take

Hello everyone,

My friend told me about this website, and how it's a great resource for learning about the finance industry. I just have a couple of questions to shoot out there.

My background:
- Senior, 3.1 GPA at a semitarget
- An internship at a small tech startup last summer
- Mainly an IT guy, only learned more about finance jobs recently
- Hoping to break into trading or hedge fund front office
- I am almost graduating and I have no offers

From reading around this forum, I realize that my long-term goal is to be a hedge fund manager, preferably in macro strategies. Right now, I want to learn more about trading strategies and macro analysis (thinking like a portfolio manager) so I can get an internship as an analyst at a macro hedge fund by time I graduate (and hopefully leverage into full-time after a few months?).

What do you all think about this plan? Are there other paths to my goal that would be easier or makes more sense? Also what are some good books to learn about trading strategies or macro analysis?

I know I am running out of time soon, so I need as much help as I can get.

Thank you all...

 

Hedge fund right out of undergrad, swinging for the fences, huh?

"For what shall it profit a man, if he shall gain the whole world, and lose his own soul?"
 
Best Response
unslain:
Hedge fund right out of undergrad, swinging for the fences, huh?

Go ahead and add "without any relevant experience" to that list. He's swinging for the fences but he's standing in parking lot.

You are going to need to demonstrate and prove your interest in investing do doing things involving investing (classes, investing clubs, CFA, internship, whatever). Given that you are senior, and it's spring, your best bet is going to be some type of masters program.

I hate to sound harsh, but it's the truth. You are going to be competing against with relevant degrees and relevant experience. But, all is not lost since you can work on these over time. I just wouldn't get your hopes up that you can land a HF job by graduation.

 

This will be...harsh.

I am assuming you are a senior graduating in June. I still have no idea what semi-target means

You do have a number of options to work your way slowly to where you want to go. If I were to distill the route to any hedge fund (and probably life), it would be:

  1. Do something
  2. Be awesome at it.
  3. Figure out some way to apply it to investing.

But let's get down to brass tacks and answer the question, Why do you want to be a hedge fund manager?

You made two assertions. 1) You haven't known about this profession/lifestyle for a long time. 2) This is what you want to do over the long term.

The combination of those two factors is extremely unlikely (to the point of mutual exclusivity). People don't wake up and suddenly want this life. And more to the point, no one reads WSO and suddenly has the daunting realization that there's an inner macro hedge fund manager just waiting to be born.

This business is a complex, difficult, and ornery business which is repelling to outsiders because it is so complex, difficult, and ornery. Whenever someone without experience waltzes in and starts talking about how this is their long term goal, it's generally because they don't really understand what they're getting into.

Any tactical advice that we give you here isn't going to help unless you figure out the answer to that central question "Why do you want this?"

It helps to put together a reading list.

Read "Hedgehogging" by Barton Biggs

Read "When Genius Failed" by Roger Lowenstein

Read "Dear Mr.Buffett" by Janet Tavakoli

Read "Pioneering Portfolio Management" by David Swensen

Read "When Markets Collide" by Mohamed El-Erian

Read "Investing: The Last Liberal Art" by Robert Hagstrom

Read "The Black Swan" by Nassim Nicholas Taleb

There are dozens of other books out there along with a million free blogs, position papers, and websites that can help you refine your search and help you understand the questions you need to ask to get further.

So, go do your research. Understand this business (at least the basics) and the why and how of the instruments and strategies. Figure out what you don't know and what you hope to get answers to.

I guess what I'm trying to say is...you seem like you're jumping the gun right now. Reading a book about macro trading strategies will help you get an internship at a hedge fund about as much as reading a book about birds will help you become an ornithologist. Its undoubtedly useful, but the devil is in the details with these things. Without the broad base of knowledge and understanding to fall back on, you run the risk of sounding like a tool when someone with actual knowledge presses you on them (like, for example, the way someone might do it in an interview).

Like jqbuyside mentioned, do things that involve investing. There's really no better way to learn about this job than trying to do a bit of it. Investing clubs, personal portfolios, and classes are all good ideas. A CFA is another option. Learn, learn, learn.

Then discussing more specific tactics on how to get in makes sense.

 
PennTeller:
This will be...harsh.

Read "Hedgehogging" by Barton Biggs

Read "When Genius Failed" by Roger Lowenstein

Read "Dear Mr.Buffett" by Janet Tavakoli

Read "Pioneering Portfolio Management" by David Swensen

Read "When Markets Collide" by Mohamed El-Erian

Read "Investing: The Last Liberal Art" by Robert Hagstrom

Read "The Black Swan" by Nassim Nicholas Taleb

.

After that, grab a company's 10k, start with the last page then read the whole thing from back to cover. Do you still want that job?

 
LDNBNKR:
wow that is great advice and at the same time the worst "essential" reading list ever

We have a difference of opinion there. I don't view any bit of reading as essential...it's all just an accumulation of knowledge.

My thought is, if you tell someone right out of college to read Damodoran on valuation....well, that doesn't tell them much about about being at a hedge fund or the modes of thinking that are employed in a hedge fund. It's incredibly useful, but not for the audience (I think) I'm speaking to. Hell, even Margin of Safety needs a bit of coaxing to get into (and you need to be of a value bent to like it).

You start easy and move to hard. These were helpful to me when I started out. They are less helpful now. Maybe they'll be helpful to him.

 

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