AM vs. IB?

First and foremost, congrats on getting an offer in an incredibly competitive industry (on top of it being a tough environment)! Now onto the substance of your post.

1. Are you stupid for passing up on the AM offer? In a word, yes, but I would caveat that my answer is biased as I am from an ER / AM background. In focusing solely on the economic merits of your decision (personal preferences can only be decided by you), it would be an irrational decision to give up your AM offer in order to pursue an IBD offer. To support this position, I would first point you to unstable industry dynamics and an unhealthy environment brought about by regulation and overall de-risking of finance. While no one knows where this will end up, there is likely further room to fall in the interim before things get better (check out how universal model banks are doing in Europe if you don't believe me). As it relates to your situation, this likely means that the number of positions will either remain flat or shrink (making it harder for you to get in, in the first place) and that above average volatility may be seen (i.e. layoffs abound). Secondly, I would point you to the ever looming threat that we've come to the end of the M&A cycle. While it's impossible to predict with any degree of certainty when this will happen, I believe it is a valid concern for you to consider given that investment banks seem to have taken to the habit of laying off even first year analysts who are otherwise average in an effort to contain costs.

With these two factors in mind, I would counsel you to weigh the value of the bird in hand versus any number of them in the bush as even if you get what you want (an IBD gig), it may not stay in your hand.

In contrast, AM, rightfully or wrongfully, appears to be a somewhat more stable field given that they simply clip a percentage of AUM to get paid. Obviously in a massive downturn, the industry will experience outflows, but so long as your group is able to go down less than the overall market (a hard task as you are probably well aware of) you will have a 4 or 5 star Morningstar rating which should stem the degree of outflows. If the funds you worked on were largely 1 or 2 star funds....maybe the IBD thing is worth considering.

I've obviously ignored a lot of nuances in comparing the AM and IBD industries, but I'm happy to go into detail on anything else you may want my opinion on.

2. You think you would regret not pursuing IBD out of college. With regards to this, I'm really curious where you developed this interest. This is not meant to be condescending, but I'm just curious how a ~20 year old who hasn't worked in IBD knows that they would want to pursue IBD. If relatives or close friends come from the business it totally makes sense, but if the interest stems out of reading misguided posts by equally ignorant college kids (not dissimilar to some on this website), I would advise you to take a good look in the mirror and ask yourself if you REALLY want to do IBD. If not, this should be something to weigh against the desire to do IBD to the exclusion of AM.

Bottom Line: It's your life, so live in whatever way gives you the greatest happiness over the long run. However, based solely on the information provided above with no further data regarding your circumstances, to turn down the AM job in favor of IBD appears to be irrational - though this conclusion could change due to any number of reasonable, unforeseen factors on my part.

Yes, you would be stupid to pass it up.

I spent two summers in IB before fortunately getting an IM job full time. The people, type of work, and lifestyle of investment management is superior in every way to IB in my opinion. Long term, the compensation is just as good if not better. Take the offer and don't look back.

If you see yourself doing AM long term, there's is no justification for going through the pain of 2 years in IB if you have the chance to go to AM right away. It's an absolute no brainer to take it.

A bird in the hand is worth two in the bush.

My advice is bypass the misery of two years in IB and go straight towards your long-term goal.

Congratulations on the offer.

Congrats on the offer man. A little off topic, but I wanted to know what are the chances of getting a FT AM offer from a BB without prior AM internship experience? I know the deal for IBD as that has been widely covered, but am genuinely unfamiliar with AM FT requirements. Any insight would be greatly appreciated!