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Interviewing at hedge fund as undergrad (Originally Posted: 03/04/2013)
Hi,
I have a hedge fund interview coming up, and what the role involves has been briefly outlined to me with little detail.
I have interviewed at BBs before, and know how ese interviews work inside out.
How do hedge fund interviews tend to go for undergrads? What stuff should I cover...? I am assuming markets based stuff, questions about the fund.. competency?
Also what kind of things to consider when formulating questions for the end of the interview? I do not want to ask generic questions, i.e. what is your view on the market...
A bit of insight from those who have interviewed at funds before would be very helpful.
Thank you.
My advice is to focus on IB, but continue to network with those more established HF's. You might get lucky, but most don't do internships or hire out of undergrad.
If you have established contacts by the time you get into IB fulltime, you'll be way ahead of the game and will find things much easier down the road. You just gotta work hard to get those connections now.
i know a couple but they aren't brand name HFs. they hustled really hard and some were from non-targets. Still, i would imagine most of the people who pull this off are target school kids.
Hedge fund from Undergrad (Originally Posted: 01/10/2013)
Maybe I am not using the search function correctly, but has anyone had success getting into a buy-side hedge fund from a UG?
More specifically, are there firms that offer SA that convert to FT and which firms do FT recruiting?
Information including West coast firms will be helpful
Citadel? i know a guy who did that but he did do a masters in between
HF out of undergrad possible (for me)? (Originally Posted: 08/31/2013)
.
I just got into a HF (decent sized @ 1B+) from a non-target. I was specifically looking to get into IB, but I took whatever I got.
I suggest you do the same instead of narrowing yourself down to an area of high-finance that has been decimated. But you'll most likely have a different experience coming from a target.
Hedge Fund After Undergrad (Originally Posted: 04/25/2009)
Hi, I'm a freshman at a target school about to finish my first year. I have around a 3.6 GPA and plan to major in Economics with a minor in Math. I have a PWM internship at Merrill Lynch this summer.
My goal is to get a job as an analyst at a reputable hedge fund after graduation. If anyone has done this, please share the route you took and any advice.
Specifically, should I strictly look for HF internships? I'm interested in finance in general, so if I cannot get a HF job then I would be banking. Therefore, should I just try and get banking internships so I dont rule that possibility out either
pm me if you want to discuss
HF Position out of undergrad? (Originally Posted: 07/30/2013)
Hi everyone
I'm currently a rising Junior at Michigan Ross. This summer I've been completing a wealth management internship at UBS in Minneapolis, near my home, where I've been doing a lot of equity research and portfolio reviews. I'm interested in eventually working for a hedge fund and am wondering how common it is to move straight to the buy side out of undergrad. I know IB is the most common route but firms like Grosvenor recruit at Ross for undergrads as well as MBA's. Going into recruiting for my junior year internship, do you think it's possible that I could get an internship position I could potentially turn into a full time offer at a hedge fund? And is it worth it to look at smaller funds who might lack widespread name recognition? How would that effect my career trajectory?
Thanks a lot
Silver Point has had a program for a long time, but they would be done recruiting by now.
Samlyn Capital recruits undergrads, although I'm not sure of the timeline there. There are not other large non-quant funds that I am aware of that have structured programs and recruit consistently, but if you are at a target school you should of course keep an eye on OCR postings.
Hedge Fund Coming Out of Undergrad (Originally Posted: 08/24/2015)
I'm a rising senior at a target school and I want to work at a hedge fund after college. I know that Point72 has a program for people coming out of undergrad and I was wondering if anyone knows of any other hedge funds that have specific programs or recruit out of undergrad. If you have any additional advice about this process it would be very appreciated.
Pretty rare, and it's safe to assume they'd be looking for IB experience
Do any respectable Fundamental Hedge Funds recruit at the undergrad level? (Originally Posted: 08/16/2011)
Specifically, at Wharton?
You mean long/short equity hedge funds? The only one I can think of that recruits at Wharton undergrad is SAC Capital. Not too many hedge funds recruit at undergrad period, mostly the quant ones like Citadel, DE Shaw, aqr, two sigma. Wharton MBA, however, gets TONS of hedge fund recuiting: moore, soros, paulson, york, davidson kempner, alyeska, SAC, etc.
Hedge Fund out of undergrad (Originally Posted: 05/18/2012)
Do any quality fundamental oriented funds hire straight out of undergrad, and if so, are they looking for any specific summer experience? Thanks.
Hedge fund from undergrad? (Originally Posted: 01/30/2015)
How common is it to go from a target school undergrad program to a hedge fund? Is an MBA/Masters required to break into the industry?
-For non-quant HFs, very unlikely. Silver Point is the best example of a very good fund with an established undergrad program. There are more popping up recently, for example Point72. Personally I'd be leery of being the guinea pig for a fund recruiting undergrads for the first time.
-Not at all. MBA is much less prized in the HF world than in PE.
For most people, going to a HF straight from undergrad wouldn't be realistic or be a good idea. But there is the occasional undergrad who is really impressive, has picked up a lot on their own / in internships, and wouldn't learn much in 2 years of banking. But even then, I know a person or two who falls firmly into that category but still chose to do IB because the recruiting possibilities are simply much more robust if you are at a group that sends a lot of guys to HFs.
most people get into banking in hopes of transferring to the buyside. if that's where you ultimately want to be, why not make the jump sooner rather than later? (especially if it's a front office role and they'll provide training)
I have seen some do it but would not recommend it to anybody. You do not learn to do anything in a hedge fund -- you only apply what you already know to make tonnes of money (for the firm -- unless you own equity!). So if you get recruited into a hfund directly from undergrad, you will either be an trading assistant or worse middle/back office operations support (which is really all trade assistants do anyways).
I know one guy however that leveraged working for free as his first job in finance at a hedge fund into a PM role and later founder his own $3B AUM fund. Good on him. I also know one other guy who went into a fund after MBA with no finance experience and only 1 summer on wall street --- now he runs his own $8B AUM fund. Both these stories are not typical. Do not believe you will be one in a million...
Call me maybe.
Undergrad Breaking in to Value HF (Originally Posted: 08/13/2012)
For some background: This upcoming year, I'll be starting my junior year at a top west coast school studying Mathematics & Economics; I have a decent GPA at ~ 3.6. This past year I interned for 4 months in IBD at a pretty well-known middle market bank in the area.
I just wanted to pick your guys' brains on taking the more unconventional route to the buy-side out of undergrad. Ideally, I'd love to be at a value hedge fund that will develop my skills upon graduation. I plan on knocking out all the classic G&D/value texts within the year - I read the Intelligent Investor and am nearly done with Security Analysis and I have also been investing my PA for a couple years. I get lots of mixed answers as to whether full time IBD experience is actually necessary - some say yes, some say not at all.
What would you guys say I should do to best position myself to work on the buy-side at a value fund upon graduation? Maybe start at an Asset Management firm i.e. PIMCO/BlackRock? Maybe do the CFA (yuck)? Maybe embrace my inner masochist and do banking? Thanks in advance.
duuuuuuuuuuuuuuuuuuuuuuuuude... take it easy... this is a super broad array of questions, it looks like you are a mess...
yesterday you were asking about IB...
btw, how many accounts do you have here and on tsr? like 6?
Getting into a HF (undergrad) (Originally Posted: 01/31/2013)
Hello all.
I am looking for some advice on how to break into a HF.
Background: - I'm a 'junior/penultimate year' undergrad at a top 3 UK university studying stats/finance/maths. - Grades: 2:1 ora first in everything with a couple of 2:2s due to a randomly poor exam day! - In my course we do a stats module which covers R (in my final year). That's the only 'programming' we do. - I have gained some IBD and tech startup experience at no-name firms but would prefer something markets based after graduating. - I don't trade my own account but am reading up a lot to narrow down what strategy/type of trading I prefer and will start on a demo account within the next few months.
Questions:
I'm sorry if these question have been asked before but your help is much appreciated. :)
Thank you for your time.
HF analyst right out of undergrad (Originally Posted: 12/14/2012)
Unless you have the credentials for a ballin' finance genius, how can you get into a hedge fund right after undergrad? Any good anecdotes? Let's assume you're not a 3.8+ student from Harvard/Wharton with BB internships and ballin' on-campus leadership (probably finance-related).
Connections? Engaged to Fund Manager's daughter?
Undergrad straight to Hedge Fund? (Originally Posted: 02/26/2008)
Working in NYC as an SA this summer, but I'm wondering what options exist to go straight to a HF after graduation. Anyone have any experience or advice in this space? I've heard a few people mention it on this board, but I feel like opportunities might be few and far between.
Thanks!
Starting in a HF right out of undergrad (continued) (Originally Posted: 07/23/2008)
Read the other post but still had some questions:
I recently graduated from university and am applying for some jobs. The regular bulge bracket investment banks as well as a few hedge funds. One that particularly interests me is fund that has around $5.5 billion in assets or so with the usual 2/20 scheme. This particular firm uses a mix of macroeconomic and fundamental analysis in their approach. I havent gotten too many details about the position yet but I'm hoping its front office work.
My question is, would you people here have chosen to go into a hedgefund right away or do the usual 2-3 year stint in investment banking. If buy side is ultimately what i want to do whether it be HF or PE, is it wrong for me to go right into it? I've read some helpful tips from the other side about the pros and cons. So i was wondering if their AUM is decently sized and they do indeed have quite a proven track record from what I know. They have been around for 10 years or so and so they have weathered one stock market downturn. I'm thinking of clarifying my role with the firm when i do get the offer and asking if I will be properly trained. If they say they plan to train me properly and invest the time, do you think it is worth it? From what I gather they seem quite interested in hiring and they are a great bunch of people as well, so quality of life-wise it seems quite good as well.
What would the starting salary be for a fresh grad? Similar to year 1 i-banking BB analyst pay? Thank you everyone for your help.
PS: Is it wrong of me to think that hedgefunds usually dont hire fresh grads? For me, I want to jump at this opportunity since especially in this current market condition, opportunities like this are rare. But will it bite me in the ass years down the line because I dont have a "presitigious" bank as my starting job? Although please note I did work at one of the BB banks for a summer. Thanks!
Facepalm.
HF straight out of undergrad? (Originally Posted: 03/11/2011)
I know I want to end in HF, but is this something someone would do? I'm really just looking for opinions if this is at all possible. I know I can do the IB--->HF route, but I feel as though my passions lie in HF more, and if at all possible, straight to HF would be great for me.
Not really sure, but I remember when I was shadowing at one of the BBs over the summer one of the second year analysts got a call from a buddy of his in HF asking him excel questions... thought that was kinda humorous
Don't intern at a HF. I think they like to see that you have already received training on some other BB's money. I would say do a rotational program your sophomore year and then a S&T or IB at a BB or top prop shop your junior year (depending on what kind of HF you want to work for).
If you want to work at a quant fund, then you should take physics and econ with minor math.
Are you from UChicago? That helps alot, the only advice I can give you is network, network, network.
It will be exponentially harder to get into a megafund (from what ive read), but smaller boutiques would not be out of reach.
network.
I have a close friend that started at a very successful HF directly out of undergrad. That was five years ago, he is now a director. If you are smart enough and can pull it off, no reason not to jumpstart your career.
Bridgewater.
Bridgewater, D.E. Shaw, and I think AQR and Citadel (?). Just a few that come to mind.
While I interned at a HF during college, the manager hired one recent grad from my school to work full time. However, I think it was at least somewhat unique. It was a very small group for one. I think he got the position because he had a very strong business sense. Soul09 is right, this new HF hire struggled with the models for a while.
No. They only hire those with banking or ER experience.
The hedge funds that hire straight out of undergrad are usually the quant funds like DE Shaw, two sigma, Citadel, aqr.
As someone who went to hedge fund directly after school, I would say this to you: be very, very careful about the quality of the fund... obviously not all hedge funds are created equal and most of them just suck.
Sorry for the broad array of questions. I don't think I posted anything yesterday about IB but correct me if I'm wrong. I only have one WSO account was what is tsr?
unknownsoldier: welcome to the boards. if you're in the industry, you can always get verified.
This is crazy
What would you offer the hedge fund as a recent graduate? That's your answer about the probability of making that kind of move. Don't say "3 months of internships experience" because that's not really offering much, is it?
People in general have the wrong idea about working at a hedge fund. If you have valuable skills to offer, you are marketable to a fund. If you want to work at a fund but have no skills, you are not marketable. That's it. It doesn't matter if you did 2 years of investment banking, went to Harvard, or anything else that people on this board obsess about.
In the last month I've probably gotten 100 cold emails from people who want a job. I opened about 20 of them, and not even one told me why I should hire them even though every person told me why they want to work at the fund. It's like trying to get into business school -- to the school, you are 100% replaceable and no one cares what you want. You have to figure out what the school wants and then offer that. Pretty simple.
Wharton undergrad gets fair share in recruitment at undergrad level, though number is low. Since for a Hedge fund/PE/Goldman SSG/ MS SSG/etc. fit is more important than just quantity. Therefore, these companies are very selective about whom they hire. If you do a quick search in linkedin and your search parameter are good, you will see who was hired.
Not too common, you will likely need connections or to do search out the opportunity yourself, as very few hedge funds recruit--think Point72 and Bridgewater are the notable recruiters. Most other hedge funds that advertise on college career services are quant firms like D.E. Shaw, Citadel, and Two Sigma -- typically looking for highly quantitative types who participate in Putnam competition or major in math. MBA/Masters not needed to break into industry, experience is more important than MBA/Masters. If you're looking for a quant fund, an MFE might help. An MBA in general doesn't really tailor you for the HF experience.
The problem with starting at a hedgie right after UG is that you'll be far more of a liability than anything else for the fund. You're fresh out of college, no modeling experience, industry knowledge, or even a money raiser. They won't give a damn fuck if you're the next Dalio, as you have no previous evidence and even if you did, past experience shows in no way future performance.
so there is a specific profile.
I'm making it up as I go along.
More and more common. OCR list this year was eye popping in terms of what was available. Consistently 5+ billion HF's and PE shops for SA and full time slots. Enough megafunds recruit at the undergrad level that I think one's chances into Blackstone/KKR public markets businesses is higher at the undergrad cycle than the IBD buyside recruiting cycle.
Point72 is saturating recruiting. Sankaty, DE Shaw, Bain and a bunch of other 1+ bil hedge funds hire in number.
Why would you intern at a HF if you want to do IB? If you want to workin in IB, pursue IB. If you want to work a HF down the road, pursue HF.
So no one sees a downside to this? I'm in a somewhat similar situation regarding PE, but I have been getting wishy-washy answers about how important having IB experience is. Any additional advice as to the drawbacks of not having that IB background?
Well, I know of a kid who had a 4.0 from an undergrad HYP school, ranked top #1-3 in math internationally got a FT offer from a Megafund (Bridgewater, Citadel, SAC)... I'm sure this is extremely rare but it happens. Btw-this kid got $250k starting LOL no joke. Probably had connections too though
Straight into HF from undergrad is a very bad idea. Most HFs are small and do not have resources to train you. Most firms are too small to have strict distinction between FO & MO roles. Basically you get in and contribute to the firm based on what you can do. Straight out of undergrad, you really can not do much in terms of real investing, so you end up doing support (read: MO) type of works. Since you won't have the opportunity to get trained, It would be very difficult for you to learn and transition into the real investment roles.
I know a complete bull-shit artist who undoubtedly landed a HF job because of his quant-heavy thesis(undergrad. someone else helped him with it, and he needed to be taught his own material before presenting it) and ended up getting axed because he couldn't live up to his supposed skills. Its actually kind of funny, cuz everyone hated on him because he is so stupid but such a bullshit artist he routinely got alot of opportunities through networking and shooting the shit with random ppl. He would always get far until finally he was seen for his true self, apparently he sold the HF hook line and sinker, landed the job, then got axed a few short weeks later.
Not a very encouraging comment about undergrads going to hedge funds since my son is presently at one.
Thanks for input Ravenous! It's really helpful to get the view of someone from HF. +1 SB.
You do realize that PIMCO is a bond fund right - not a value Stock Picking fund
Only the largest hedge funds (and only some of those, actually) have annual/systematic recruiting processes. Of those that do, even fewer look at undergrads. The ones that do are often quant-heavy (Citadel, DE Shaw) or uniquely process-driven (Bridgewater) so they care less about prior finance experience.
As the above said, the more likely option is smaller funds that recruit on an ad-hoc/relationship-driven basis, but you should be cautious about the fund and the role.
Although I am in no position to be picky, I have heard some mixed/interesting things about Bridgewater. What do you think about them Macro Arbitrage?
Do you really suggest I take physics? Have you heard of quant types actually majoring/minoring in this?
It's very rare, and they tend to be the small to very small AUM (
Bridgewater, Citadel, and SAC all have programs for undergrads and do summer interns. You heard wrong if you think the kid was making 250k starting- these megafunds pay about same base as the BBs. At Bridgewater the job is much more paper-pushing then anything.
Well, despite what Bill Gross may say about the death of equities, he's a little bit of a hypocrit for being in the middle of raising an equity fund (with the help of one of my favorite Wharton alumnus)... that said, yeah PIMCO is totes for bonds bro.
Boy do rumors go a long way... I know of a kid who started at Rentech with $2mm all-in comp. He was such a math whiz. Oh my god.
I read that letter. Wasn't he essentially talking about the death of US equities? Emerging Market eqs still going strong (Actually , Neither India nor China nor Brazil , but ... HOPE).
While we're on the subject - what are value HF interviews like? Stock Pitches? Onsite analysis of stock? etc etc -
At the end of the day it'll be what you do with your time at the HF.
I agree with HedgeKing. While it may sound cool to tell your friends that you work at a hedge fund as a 22-year old, it's a risky move.
this is going to sound crazy but craigslist job postings. actually heard from legit funds who advertised positions there.
What about a small local hedgefund that is very unstructured, I am only a senior in highschool and a family friend has lets me come in and watch him whenever I want, which ended up being a few days a week during the summer. I learned alot because he runs the fund single handely, and makes all the decisions and explained to me why he was doing what he was doing.
Point being this fund is very small like AUM >10mm.
But I guess if he wasnt a family friend this wouldnt have ever happend, and it is technically not a hedgefund just a Advisory firm, but I have learned alot but there was no modeling involved mainly just technical analysis, very unstructured, but could land a job if nothing pops up after college
hedge funds can be tremendous grounds for good learning experience; in fact, i sometimes think it is a waste of time to have ppl do banking for two years, and THEN go to the buyside; they really are two different skill sets in spirit, even if functionally some of the work is similar
i interned at a distresed debt fund and learned a ton; like an idiot, i decided to do banking, and now it is getting tough to get back into the buyside game for me personally; but for anyone who has the chance, i would strongly recommend taking a hf offer if you get one in undergrad. a few things to keep in mind when doing this:
1) pick the right strategy for you; i am only looking at l/s equity and some event driven, because this is how i personally look at investing to begin with
2) make sure the fund is established; you don't want to join a fund that is just starting out, if it doesn't have sticky capital (or is just beginning to raise capital)
3) some funds that i know of that will hire out of undergrad are: sankaty, DE Shaw, ramius (although not sure how common this is), GSAM and their various strategies/practices, there are tons of others, not to mention the smaller sub-$2.0BN funds
4) i don't know about other places, but for l/s funds, i think it's def a good idea to have a long idea and a short idea fleshed out; this is what i'm interviewing for now, so sometimes i'll just submit an idea along with my resume
5) make sure that at least one person you're directly working for at the fund is a mentor-type, cause otherwise it will be tough to appreciate everything you'll be learning, and hence, you won't learn as much. (this isn't from me, this is from a pm i spoke with on a recent interview)
there's alot of other things to look at, but i think in general, if you get a good hf offer from ugrad, consider yourself lucky to be able to escape the mind-numbing drudgery of the sell-side
My advice to you is; if you do want to take that route; understand what it is to work at a fund. I.e. ops/analyst/execution trader etc... You have no value out of school, as mentioned above there is a job and it needs to be filled. Value added comes after several years of experience; and even then only on the investment side. Most people, myslef included, had no idea what it meant to work in a hedge fund right out of school; i did take that route. PM me if you want more
Haha I take it the sarcasm implies the question is obvious and/or easy to search for. I looked at 6-7 threads asking this question and the most insightful contribution was something along the lines of "facepalm".
BH, I've asked you about this before actually and you basically told me to "go for it" and keep doing what I'm doing by reading the books, etc. But while I go to a good school, no hedge funds recruit here formally.
If you guys were in my shoes, what would be your plan of action to get there sans banking?
undergrad to HF......same as above be cautious....might be tough to break out of MO/BO role; regardless of your performance; you move up based on the firm...exceptions as mentioned above are the top funds; where generally speaking all on your perfrormance
You pursue IB if you want to get into hedge funds. You need the relevant analysis components. Very few hedge funds, if any, will hire non-bankers.
Marco doesn't know what he is talking about.
If you want to do IB, apply for IB internships.
If you want to do HFs, apply for IB internships.
Hedge funds don't need and or want interns for anything other than admin. stuff. You are much better off getting an investment banking internship. Try to look for groups that are good feeders for hedge funds.
For example, if you want to work at a merger arbitrage fund, look for M&A groups in IB. If you want to work in a commodities fund, try to get on a commodities coverage group in IB. If you want to work in a credit fund, get in a credit or FI group.
Understand?
I agree that you should not overlook the imporance of sell-side training programs during your internship as most buyside shops lack any type of structured training, most of the learning is done on the job. A junior year stint in S&T or IB or a reputable prop shop would position you well for an HF position after graduation but again the regulatory environment could change so drastically over the next 3 years that alternative investments could fall out of favor. just keep up your GPA
Your choices are relatively limited. Quant shops like Citadel and DE Shaw require high proficiency in coding, as they are essentially technology companies operating financial markets-driven strategies. Funds that don't require this are usually L/S equities funds. Bridgewater is an exception, although their culture is infamous and they make you sign a noncompete so mobility is limited.
The rigidity and near-sightedness of your reply is rather amusing. Numerous people on the buyside have never set foot into the sellside. Joining a HF directly is very much within the realm of possibility for those who get noticed and are capable of adding value, particularly at an internship stage. Regardless, I wouldn't know what else to expect from someone who is apparently incapable of spelling "M-A-C-R-O" and goes by the name "booger".
"Very few hedge funds, if any, will hire non-bankers." - That statement alone reveals that you have never set foot into the buyside. I would suggest you refrain from dispelling nonsensical advice over an online forum.
I think you would have a good shot (depending on where you go, if you've told me already, my apologies) at breaking in if you go for one of the larger asset management firms that have certain funds devoted to value. These are places like BlackRock, Fidelity, etc. PM me if you want to give me specifics and I can try and give a recommendation on what place would be best given your school, grades, or work experience thus far. But yeah, if you can't get directly into a hedge fund (this is really uncommon no matter where you are) then big name AM places are your best bet. Actually I'd recommend them because going straight to an HF they won't have time to teach you much and you probably won't be able to contribute, which ends up being a very contradictory learning experiece.
And to GS, interviews with these value-esque firms would usually consist of some sort of conversation about general market opinions (maybe what do you think of Europe, etc) just to see if you really do give a shit about the markets and pay attention, then maybe what sectors you're interested in, pitch me a stock from that sector, yadda yadda yadda. Then just the standard BS of walk me through your resume and all that still applies. But really an emphasis on talking about some stocks you like and maybe you're process of arriving at your conclusions about that business. Not very common to have a case study / evaluation during the interview but some places definitely would do that, just none that I can think of right now.
Macro, what do you think about starting at a HF right out of undergrad? The fund in question has been ranked around the middle of the Bloomberg magazine list for the past couple of years, multiple billions in AUM, but the strategy for which they are recruiting an analyst is incredibly niche, so it is questionable how marketable the experience would be should I want to change shops down the line. Can give more details if you want to take it to PMs.
What about relative to other opportunities such as: - asset allocation/portfolio construction/risk management at a large fixed-income long-only - market-making at a bank in a fairly illiquid product
Top west coast school would imply Stanford. But could be Berkeley, but guessing Stanford.
lol wut You got one right but if you really want to trade commos (and not commos stocks) you better NOT do IBD, even in a commo coverage groups. Especially if he wants to do some quanty stuff he better stay away from IBD.
I heard a hyp 4.0 kid that graduated when he was in 12 in horse psychology became pm straight out I undergrad at a livestock fund and got 300m guaranteed all in comp!!!
Do the CFA. Level 1 is easy and it can only help you by demonstrating seriousness. Talk to as many people as you can reach in the industry and see if you can find a personality/investment philosophy match. Be willing to work for a small, no-name shop ("emerging manager"). Consider moving to New York where you would have more options. Look for someone who could be your mentor, irrespective of the firm or exact strategy. Network, network, network.
If you can't find an opening or a fit straight out of school, don't feel bad. Plenty of places you'd enjoy working would love to have you in a few years, but might not have the resources to train you from the ground up. Instead, go for the traditional post-undergrad role that you feel will best develop your investing toolkit. (Hint: probably not banking, unless modeling and sheer endurance are where you need the most work). Equity research, Asset Management, accounting, large mutual funds, and consulting are all viable options, but you need to do your diligence. Your experience and its usefulness in helping you learn how to invest will vary widely based on the people you work with and the expectations for your role. Good luck!
Sounds like you were to weak to get into banking and have a chip on your shoulder.
Can you please give me an example of someone who adds value to a credit or debt hedge fund who hasn't been involved in some sort of capital markets, FIG, or ECM/DCM role?
Please don't tell me marketing or raising assets.
As for misinterpreting macro, apologies, I actually work unlike you college boys.
There are no actual drawbacks to not having the analyst stint ant the Investment bank. If you want to move to a hedge fund that focuses a lot on the Fundamentals after the sell side job, then you might want to go to private equity. Why not jumpstart your hedge fund career/get ahead if you can? IB experience isn't relevant to most hedge funds (eg, Quant, Macro, energy, equity trading houses, prop shops). The only reason people think it is arund here is that this is a IB forum. As for the salary, the size you mention, base would be $60K-65K and the bonus would be 70%-120%
http://modernyuppie.blogspot.com/ The musings and antics of a Meathead College Wrestler Turned Asset Backed Securities Trader.
i would say this... make sure you know what you're getting into especially coming out of undergrad, I think there's a very good chance you won't be good at projecting what working at a particular fund is going to be like...
I think Citadel hires traders out of UG
Good post wallstreet guy
There are so many funds out there, a lot that are sub 2.0BN. If you have say a SA stint at a MM bank, is it possible to leverage that into one of the smaller funds? If so, is it even worth it, and how do you tell if it is a quality fund?
I think an ideal role for me in finance would be either a macro or quantitative strategist or some mix of the two. I don't mind programming but I would not enjoy a role focused on developing software or technology.
If I can't get into a role offering this, where would be a good place to start?
Just make sure your role is clearly defined prior to joining. Look out for anything that could signal MO or BO type work...
Booger45, Bain Capital's credit fund, Sankaty, hires undergrads as analysts, as does Blackstone's credit fund. Bridgewater, Bracebridge, Element Capital, and a number of other macro funds hire undergrads. In equities, there are literally dozens of hedge funds looking to train undergrads. Many of these funds are skeptical of the utility of the financial modelling done in banks, and prefer to do their own training.
Also, ever heard of RenTech? http://en.wikipedia.org/wiki/Renaissance_Technologies
If you're brilliant and really know your shit, you can do it. Friend of mine has P.H.D level math/physics knowledge, programming skills, and a lot of experience with charting/technical analysis and he's working with a quant fund.
DE Shaw and Citadel do pay around 180-200k all in for 1st years right out of college.
My best advice is network hard and utilize connections, that's what I did. I graduated this past May and was fortunate in that I knew someone who knew someone who worked at a hedge fund, and it just so happens that hedge fund was currently looking to hire a recent college grad for an entry level analyst position. Not sure if you go to a top school or not (I certainly did not) however if you ever get a chance to land an interview make sure you are very confident (not cocky) and have decent references. I was told the day of my offer that there were other candidates who had way better academic credentials, however, they liked my attitude/confidence in my initial interview and that's what really weighed in on their decision.
Doing a 2-year investment banking analyst program is by no means essential or even really that necessary to winding up at a value hedge fund. Really good excel skills and a thorough understanding of financial statements is obviously helpful. That being said, accounting is not hard to learn. Even if your school doesn't offer accounting, you can learn it pretty easily through the CFA texts. You can get a few really good excel books for less than $200. And perhaps most importantly, really complicated models aren't integral to being a fundamental equity analyst. The best guys I know couldn't build an LBO or M&A model to save their lives. Unfortunately, banking is the traditional, most common route to a good fund.
If you have already done an IBD internship, you should try to line something up on the buy-side next summer. Ideally it would be an equity fund (mutual or hedge). Pound away on your school's alumni network and try to get in touch with anybody you can for an informational interview. It doesn't have to be a value fund, but someplace where you can learn about analyzing businesses.
Stick with the books, if you need a list of more good ones look up the reading lists for the value investing courses at Columbia:
http://www4.gsb.columbia.edu/courses
The CFA really isn't going to make you a better analyst, but you can take L1 in December of your senior year. The CFA job database is very good, and it demonstrates a certain level of commitment.
i mean, i haven't done it, since i haven't been in the situation, but i don't see why it wouldn't be possible? i mean at the end of the day, you need to show that you have a passion for investing and an awareness of how to assess companies, with respect to the strategy of the fund.
for someone who had an SA at a MM bank, i think you just have to show this by showing an investment idea, along with your resume. one thing i've noticed with hedge funds, is that alot of them (especially the smaller ones) function almost as like research groups at a university or something, moreso than as your standard "finance-type" ppl; and this is regardless of strategy (i've seen this at the l/s equity funds i've interviewed with, and heard it from others). so what they really care about is "are you smart?", as opposed to pedigree, like PE shops (which is why, personally, i think many ppl at HFs don't think very highly of PE, and sometimes even can't tell the difference between PE and banking). so if you can show this through your investment ideas, as well as your approach in an interview, i think you're good.
also, how you tell quality is the following: 1) where are PMs from (which banks/funds/prop desks) 2) what is the quality of the capital (what kinds of investors)? how much is internal vs external 3) what is the return (as soon as you can get this; sometimes they are reluctant at first)? obviously a big one 4) do you get carry? when do you start to get carry?
would start out with these; also, make sure they're not pricks. alot of HFs have pricks, kind of like a know-it-all-and-all-my-students-are-idiots prof you might have had in college
how much safer is say, a hedge fund with 1 million AUM+ with 20+ people?
you didn't make it clear what kind of fund it is. (maybe you don't know) if it's a quant shop you will have a hard time moving into PE down the road if that's what you want to do. also, as alpha was getting at, you will need to be more of a self-starter and probably self-trainer. ultimately, i wouldn't worry about that and if it seems good, take it, especially in this market
i would like to hear more about this too
i think the only good legitimate hedge funds that might hire out of UG are the internal ones in banks, like GSPS, GS SSG, other GS Investing Desks, Lehman Eq. Strat, UBS Prop Investing...etc
Does anyone know of any other good hedge funds? I know Citadel hires. I assume Och-Ziff doesn't...
This. In 5+ years on the buy-side I've never had someone say "send me your model" before putting a position I pitched in the portfolio.
$1 million+ AUM so basically any other HF out there....
^Really? So when you pitch your idea what's the typical procedure?
But many job postings want a candidate in the CFA program.
I'm guessing the returns on the higher levels of CFAs aren't worth it. Personally , if I get into a good B school , I'll have a shit ton of free time - so maybe I can get thru level 1 and 2.
I was wondering if this advice from undergrad to hedge fund would be the same for a fund of funds firm. I interviewed with a firm for an internship and decided against it, but was wondering for a full time position where they offer a 3 year program. What kind of differences are there between hedge funds and funds of hedge fund firms.
Unless you're at a Citadel/DE Shaw type quantish place (which is a very tough environment to survive in), most big HF that hires undergrads aren't putting you on the PM track. I don't think I've ever seen someone with a bio that says they worked at Bridgewater, the place is a black hole into Dalio servitude.
Networking is the name of the game at smaller funds. If you have a couple really solid trade ideas and some internships at BBs/Asset Managers, you might be able to get into a L/S fund. In the macro space you'll at the very most get a chance to crunch numbers until you get too expensive, you just don't bring enough to the table as an undergrad.
I was a buy side analyst for two years, three if you include an internship. You on the other hand have no credibility and are most likely posting from Starbucks.
Is linking Ren. Tech and telling me macro funds hire Undergrads all you guys can come up with? Clearly macro funds will hire from a more diverse background. There are some examples of some systematic roles being given to engineering/sciences undergrads, I will certainly give you that.
Let me restate. Unless you are graduating with an engineering, systems, or hard sciences degree from a top school in the US or UK (MIT, Imperial, Cambridge, etc.), you are not getting a front office role in a mid or top tier hedge fund straight out of UG. Sure there are exceptions, and good luck if you get them, but the far more sensible and logical way to go about it is to spend a few years in banking and develop the skill set necessary.
How are the ladies at Starbucks looking today, Marco?
my bad meant $1 billion
When someone says something is definitely one way, you only need one counterexample to prove them wrong. Also, the OP didn't say anything about joining a 'top tier' fund. You're the one who said that. I agree that it's unlikely to get a hedge fund job out of undergrad, but let's face it, it's pretty low odds any way you slice it, so it can't hurt to give it a shot.
I think you'd be surprised on the former.
I agree with the latter half of your post and should have made it clear that, while not impossible, it is a much more calculated risk to go with banking for a few years and then lateral.
Additionally, the reason I commented on this thread was to hint at the fact that the banking skill set is a reason that I went from buy to sell rather than sell to buy. It really cannot be underestimated and it is extremely helpful and something I wish I had done prior to working for the large fund that I worked for.
All of this being said, if you have an engineering degree from a reputable school and can program, you can very easily land a six figure job out of UG in a good hedge fund. As someone stated above, any Ph.D in a hard science will lend itself to a quant job very nicely.
For one, you must be functionally retarded as you repeatedly fail to spell Macro correctly. In fact, I'm convinced you've never been a banker as your attention to detail leaves much to be desired.
Without revealing too much about myself, I have spent my entire career on the buyside- starting with a bank CAT prop desk and currently a quant macro fund. I do have a 'hard science' background from a top school, however that has absolutely nothing to do with it. Banking would rarely develop the skillset necessary for my current role, but I do applaud the fact that you go to great lengths to make things up as you go along.
Funds of hedge funds invest in hedge funds (obviously). They pick managers and along with them their overall strategies. They take a smaller cut of profits than actual HF managers. It is not as fun of a job as working for an actual HF and the pay is not as good (though its not bad either).
Being a ballin' finance genius has very little to do with credentials.
I got hired by a HF/money manager out of undergrad. Though the first 2 years will be an assistant portfolio management role, it will transition into a research analyst role. I'll also concede that it's more of a quant shop so modelling skills are not required. I also have seen various postings for analyst positions on my non-ivy school's career website, looking for seniors. I imagine if i went to an HPWS school there would be many more.
You can't say it's any safer. Depends on the strategy, the people, how long they've been around, etc.
As for op, I suggest you start in IB. You can lateral to a HF of your choice after a year or so. You really learn a great skill set in banking that is applicable anywhere in finance. Remember, you'd be paid shit if you went straight from undergrad into a HF, and if the fund were to close within 6months-1year since your start date, you would be screwed. Take the less risky route. Depending on your preference in strategy, try to land an M&A or LevFin group.
See, that's the problem with the hard science majors. They don't understand even basic levels of sarcasm.
As for your background, you'll notice my caveat in reference to macro funds. I personally dislike macro funds, mainly because of past experiences but also because I share the general sentiment that it is difficult to play the macro game successfully. I also dislike multi. strat funds, for what it is worth. Better to be niche and specialised imo, easier to raise capital and also to make money.
Would people recommend banking over places like Sankaty or Bridgewater that have structured undergrad programs?
network like mentioned earlier, unless you're at one of the funds with an undergrad training program, you are going to be in for a bit of a steep learning curve. i had absolutely no training and was basically asked to figure out things on my own. dont know if starting out on the buy side outweighs sell side training but i love it
he's from st andrews, nailed that shit
Yo saints2009
http://www.wallstreetoasis.com/faq/where-can-i-find-some-of-the-best-di…
Read up on BlackHat's, Mr Pink Monkey and SirTradesALot posts.
SonnyZH. I disagree with ur post totally. Its more about whether your a fit and willing to learn without a structured training program. Some hedge funds doesn't even bother about modelling at all. Of course you can argue its desired based on headhunters and job advertisements.
If you can get in there I would take it. But don't bank on getting into one of those shops out of undergrad given a front office role. Basically don't screw yourself up and not network/interview for IB as well.
Of course you'll go in to learn, hedgies have a huge learning curve in comparison to BBs. But why should they hire a fresh UG instead of a 2 year analyst at a top BB/MBB? I'm not saying it's undoable, but very difficult unless you have good contacts.
I think it's rare for an undergrad to go directly to HF. It's probably better to start in S&T or IB and then jump into an HF later, especially when you would otherwise have no skills and no friends.
The two best options are:
many big hedge funds have roles that are not necessarily front office, but are still great places to learn and are a good way to get your foot in the door. Examples of these positions include valuation groups, corporate development, investor relations/fundraising. Work on getting your CFA and then hopefully jump ship to a FO gig at smaller fund and bring your "big fund" experience.
Getting your foot in the door at a small fund and doing the work that no one else wants to do. Become a "jack of all trades" by doing everything from fixing people's Blackberry's, managing the Bloomberg subscriptions, and all the other grunt work. If you keep your head down, maybe you can take on some research/analyst work.
Cause the UG already knows that he/she is interested in markets rather than deals and they want to end up in the buyside eventually. At the end of day, how many of us enjoy pitch-booking or going through IB hours, or even travelling to different regions jus because the MBB role demands for it? Not everybody is made for that.
Of course OP has to put in lots of effort into his pitch and follow the markets closely and even craft out his own 2 page equity reports cause certain hedge funds demands for it.
Networking will always be #1 priority. Definitely it has to be started in freshman/sophomore years. Good contacts will definitely help as well.
Quotation:
But why should they hire a fresh UG instead of a 2 year analyst at a top BB/MBB? I'm not saying it's undoable, but very difficult unless you have good contacts.
That's the kind of thinking you're running up against.
Have you ever worked at a HF before or talked to a HF analyst before?
lol at aspharagus. just lol.
Fair enough GoodBread. Looks like the consensus here to get into Hedge funds is only the IBD route.
A number of funds recruit undergraduates at top colleges. There are lot of reasons why they do so:
-A lot of the funds I interviewed with wanted people who thought a bit differently from the crowd, and weren't interested in doing the typical banking routine.
-Some wanted to be able to train someone from scratch, rather than force new hires to unlearn a lot of stuff from banking.
-One very honest manager told me that it takes about as long to get a former banker and an undergraduate fully trained and useful at the fund, and the undergrads are cheaper at first.
-A lot funds that do not pursue a long/short equities strategy have very little to do with banking.
-I think some of the small to mid-size funds I spoke to didn't want to have to deal with the weirdness of trying to recruit bankers while competing with private equity firms, etc. They preferred the structure of on campus recruiting, and the banning of exploding offers.
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