BB Asset Management Arms and Asset Management Firms: how do the experiences differ?
How do internship/first-year ft roles differ between BB asset management arms and large scale asset management firms, assuming similar or near equivalent roles? Do you think it's better for recent graduates to begin in either over the other if they decide to stay in the path they pick up through their internship?
I know this inquiry is awfully broad, but any direction would be greatly appreciated. My goal is to get a better understand of what an excellent start to one's career would look like in terms of different companies.
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I'll bite. As you've mentioned this is a very broad question you are asking and the responses will be subjective. As a disclaimer, I have only have experience at a BB AM group interning over two summers, so that is the perspective I can give you. In hindsight, I personally would rather be at an individual AM company rather than a BB AM arm. One thing I've learned is that I believe it's better to be in the bread and butter business of a company rather than an extra revenue generating business that is not necessarily the focus of the firm. For ex, I've hear the running joke that [BB name] AM is the red head step child of the bank. Good business, smart people, decent share of firm revenues, but not where the focus of the bank really is and it will always come 2nd to S&T and IBD. What does that mean for you at the junior level? Not much. Your work and exposure is still pretty much the same, especially if your banks AM is well respected in the business. As you get more senior you will see that these BBAM arms tend to get very top heavy, meaning there are a TON of VPs... and you question wether there really is much upward mobility once you hit the VP level. On the other hand, there are some guys and gals totally fine with spending ~10yrs at the VP level and eventually going somewhere else or doing something else. To each his/her own.
Another difference that I might note, is that the overwhelming majority of seats for undergrads at BB AM arms are for more sales/distribution/relationship management types of seats, and this is especially true for GSAM/JPAM/MSIM. This is great if that is what you are looking for in a career. Stable business, great hours, good money with generally extraverted and sociable people. But if you are looking for pure investing experience it can be difficult to find the seat you are looking for. In my SA class, there might have been maybe ~20 investment interns, where maybe half of us were working in PE/HF secondaries, and a few in direct private investing and long only equity/credit investing. Unfortunately I don't have any experience at any of the AM companies like BlackRock or PIMCO, but happy to answer any questions about my time in BB AM. Spent one summer in long only investing and one summer in direct principal investing, going into IBD full-time instead.
Very astute take on recognizing the issues with not being the primary focus of the bank. That's a culture (and economic) issue. The challenge will always be getting the appropriate resources, recognition, etc. Those are finite and usually go to the core functions of the firm.
Ran into this a lot when my team was providing wealth mgmt services for retail community banks (yes a different animal but essentially the same situation). We were quite profitable, added valuable services to the bank's offerings, helped solidify client overall relationship, etc...but we never got a seat at the adult table because we weren't really part of the bank. Just this nice little side business but they never allocated any resources, marketing, etc.
Thanks for providing some insight. I’ll be joining a GSAM / JPAM / MSIM this summer in a fixed-income investing role and was wondering if you could give some information on what your full-time IB recruitment process was like coming from AM. Did you stay with the same firm or did you lateral? When/how did you start networking and how did you approach making the move? What were you reasons for deciding to move to the sell-side coming from a sought after buy-side role?
I’ve been planning on trying to make a similar move and would really appreciate your feedback. Thanks!
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