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Why work at a Fund of Funds?
 

freemarketeer's picture
 
Points)
 on 1/11/12 at 5:54pm

Besides having no where else to work or looking for a stepping stone. I don't know much about the actual work done at a FoF. Got a random interview with one from a recruiter and decided to go for it for practice, at least.

I enjoy doing fundamental work, and I feel like working at a FoF would just remove me from what I'm good at. I'm not a fan of Modern Portfolio Theory.

Tags:
orangejulius's picture

what shop?

CF
 
Points)
 on 1/11/12 at 7:08pm

what shop?

freemarketeer's picture

Not going to divulge the

 
Points)
 on 1/11/12 at 8:37pm

Not going to divulge the name, but it's a multi-billion dollar family office in NYC.

rothyman's picture

What kind of position is it?

HF
(King Kong, 1,163
 
Points)
 on 1/11/12 at 9:15pm

What kind of position is it? Due Diligence?

GoW's picture

I currently work in FoF > $1B

IB
(Orangutan, 326
 
Points)
 on 1/11/12 at 9:36pm

I currently work in FoF > $1B and my biggest issue with it is the absence of a skill set. You will get really good at manager due diligence/operations/accounting/sending money...which I guess could be interesting to you depending on what you want to do in life? A pro is that you are pitched by people who you would love to work for...You try to quantify the alpha added by the managers; however, by the time you get data it's already dated (unless you're under hedge funds/public equities/fixed income). If the fund partakes in assets (mineral rights, etc) or private equity you can expect a lag anywhere from 1-3 months on financials. It would really come down to what your responsibilities would be. I always find myself thinking it would be a good place to work instead of giving into retirement. The biggest benefit to the client is the exposure to alternative investments in a fashion that claims to mitigate risk.

One important note: where I work doesn't really serve any "clients". I can't imagine how I would feel about my job if I had to worry about client relationships, etc.

IgorBright's picture

may not be what you like, but

ST
 
Points)
 on 1/11/12 at 9:46pm

may not be what you like, but would this be a good stepping-stone for your future career path?

freemarketeer's picture

I haven't even been told what

 
Points)
 on 1/12/12 at 5:40am

I haven't even been told what the position is about, but I'm assuming DD. These guys keep things pretty close.

GodofWine: Are you looking to leave? How do you feel about exit ops? You're take on the matter is what I would expect. It seems like a possible stepping stone, but if you're not acquiring any useful skills for another position, why would you be hired over someone with a more pertinent background?

GoW's picture

1) Yes. 2) I don't know

IB
(Orangutan, 326
 
Points)
 on 1/12/12 at 6:08pm

1) Yes.
2) I don't know enough about exit ops to comment. The people that work there have been there for awhile and will most likely stay for awhile. I think the best possible chance they have is to go from an analyst to a manager and then lateral to a fund of some sort. The most likely candidate is a mutual fund in my eyes.
3) I don't see this being a good way to build a skill set; however, I could see it being a good way to make contacts if you play your cards right...

freemarketeer's picture

Update: It's an asset

 
Points)
 on 1/12/12 at 7:15pm

Update:

It's an asset allocation position, which will primarily be manager DD, but also analysis for some co-investing. Apparently they were actually looking for someone like me because they need help on the co-investing. I was certainly more impressed than I expected.

I'm still wondering though if I would be better served waiting for a direct investing opportunity. The comp is probably enough to outweigh immediate considerations, but I worry about longer-term prospects.

Fictitious capital's picture

rothyman wrote: What kind of

 
Points)
 on 1/12/12 at 7:50pm
rothyman:

What kind of position is it? Due Diligence?

LOL, DD at an FoF! Good one brah

rothyman's picture

Fictitious capital

HF
(King Kong, 1,163
 
Points)
 on 1/13/12 at 1:24pm
Fictitious capital:
rothyman:

What kind of position is it? Due Diligence?

LOL, DD at an FoF! Good one brah

LOL, eat shit.

AlsatianCousin's picture

This topic is super helpful.

 
Points)
 on 1/29/12 at 8:18pm

This topic is super helpful. I have an interview with a FOF soon, and I honestly don't know what to expect as I've only had PWM experience.

From what GodofWine posted, FOF doesn't sound too great. Am I wrong in saying so?

GoW's picture

It depends on what you want

IB
(Orangutan, 326
 
Points)
 on 1/29/12 at 10:33pm

It depends on what you want out of it... I get to see different investment strategies on almost a daily basis. Different plays. I get to see secondaries, distressed debt, real assets, energy, minerals, middle market, vc, etc. Anyway you slice the private equity pie I have seen some variation of it... You also get a lot of contacts.

Relinquis's picture

What do you guys think you

RE
(Neanderthal, 2,186
 
Points)
 on 1/30/12 at 5:46am

What do you guys think you could do with those contacts/background?

Become a placement agent? Set up your own fund of funds/secondary fund, work for an institutional investor/pension fund/family office, become a consultant, etc...?

relinquis... Killing the GMAT this December; Over/Under set at: 725 GMATs.

Compass's picture

God of

(Chimp, 3
 
Points)
 on 2/6/12 at 12:27pm

God of Wine/Freemarketeer,

Would you mind sharing some of the interview questions you have received? Also I have been told it's always better to stay on the investment side than to do operational DD or fundraising/placement so referring to Relinquis's question above how do you leverage the network/contacts you build up through FoF for exit opp?

freemarketeer's picture

Nothing special, really.

 
Points)
 on 2/6/12 at 8:26pm

Nothing special, really. "Tell me about a stock you cover". Had to talk through the idea, go through the overview, fundamentals, etc. The questions were a minority of the interview. I actually spent more time asking questions than he did.

What really threw me for a loop was his warning that going to a FoF is a bad idea if you want to get to a direct investing role eventually. He made it clear he tried and couldn't get out. I semi-tried to dodge the question when he asked me if I was ok with that, but I think he knew I didn't really want the job.

happypantsmcgee's picture

AlsatianCousin wrote: This

O
(Almost Human, 9,621
 
Points)
 on 2/6/12 at 10:12pm

If I had asked people what they wanted, they would have said faster horses - Henry Ford

AlsatianCousin's picture

happypantsmcgee

 
Points)
 on 2/7/12 at 4:46pm
GoW's picture

My interviews included

IB
(Orangutan, 326
 
Points)
 on 2/10/12 at 1:00am
Bowser's picture

Hard for me to see someone

IB
 
Points)
 on 2/10/12 at 3:43pm
Brady4MVP's picture

God of Wine wrote: My

HF
(Neanderthal, 3,161
 
Points)
 on 2/10/12 at 4:01pm
blueslord2910's picture

How is it different from AM?

 
Points)
 on 2/11/12 at 1:10am
evan.ysy's picture

Read through several

(Chimp, 1
 
Points)
 on 5/7/13 at 9:26am
challengeaccepted's picture

God of Wine: My interviews

(Chimp, 11
 
Points)
 on 5/16/13 at 5:40pm
windycity2000's picture

FoF is the deadend...

(Chimp, 10
 
Points)
 on 5/18/13 at 1:12am

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