LO Swap?
Currently an analyst at a ~$50B mutual fund, where job security is very good, but career advancement seems slow (many other analysts in line to be PM before me). Already in my mid-30s, and unlikely to be considered for a PM seat within 10yrs. I’m considering going to a $5B mutual fund nearby where there is only one other analyst and more potential to have a bigger impact and easier PM track. Am I crazy?
Based on the most helpful WSO content, your situation is not uncommon, and the decision largely depends on your career priorities and risk tolerance. Here are some key considerations:
Career Advancement vs. Stability: At your current $50B mutual fund, job security is strong, but the path to a PM role seems long and crowded. Moving to a smaller $5B fund could offer a faster track to a PM seat, especially with fewer analysts in line. However, smaller funds can sometimes carry more risk in terms of stability and resources.
Impact and Visibility: At a smaller fund, you’re likely to have a more significant impact and greater visibility, which could accelerate your career progression. This aligns with your goal of having a clearer path to a PM role.
Risk Assessment: Smaller funds can be more volatile, and if the fund underperforms or faces challenges, it could impact your job security. Evaluate the track record, strategy, and leadership of the $5B fund to ensure it aligns with your long-term goals.
Mid-30s Consideration: Given your age, the decision to switch should weigh heavily on your long-term career aspirations. If you’re confident in your ability to contribute meaningfully and the smaller fund offers a realistic PM track, it might be worth the move.
Cultural Fit and Team Dynamics: Consider the working environment and team culture at the smaller fund. A good fit can make a significant difference in your job satisfaction and career growth.
Ultimately, you’re not crazy for considering the move. Many professionals in your position have made similar decisions to prioritize career growth over stability. Just ensure you’ve done thorough due diligence on the $5B fund and are comfortable with the potential risks and rewards.
Sources: Life decisions...buy-side equity analyst, Q&A: HF Analyst @ $5bn+ Fund - Breaking In and Transition to Risk-Taking Role, Q&A - Analyst at $1.5B Endowment Fund, Q&A - Analyst at $1.5B Endowment Fund, HF Analyst: The Things I Know For Sure
What’s your comp? Working hours? And YOE?
Total comp is $425k all in, similar for both positions. Working 50hrs/week. 7 YOE.
Not in any particular order, but some other things I'd consider are, AUM/IP, product differentiation, historically how often do promotions to PM occur in each fund, investor type (institutional, retail...), research process. No one can really answer you without these.
Very true. Research process is similar. Analysts have been promoted to PM at smaller fund. Not at my current larger fund where they hired externally for Pm hires recently. Both have differentiated products and charismatic CIOs.
It’s not crazy at all, actually. If career advancement is slow and you’re not likely to make PM at your current fund, moving to a smaller firm where you can have more impact and a quicker path to PM could be a great move. You’re in your mid-30s, so time is a factor, and if you’re motivated to move up, a smaller firm with more room for growth makes sense. Of course, the tradeoff is less job security, but if you’re confident in your abilities and want a faster track, it could be the right call.
I would try to dig into that $5B asset base and find out how much risk there is. If there is big account concentration that would be less compelling vs if it is all smaller accounts with embedded gains. If performance hasn't been good recently you want to think about how much runway the firm might have to turn it around and that is typically a function of the stickiness of the asset base. If you go there and they have another 3Y of poor performance could the asset base implode or would it be a slower bleed (providing additional runway to turn it around)?
Lots of good advice here so won't duplicate and definitely do the performance/client base due diligence noted above. Assuming all that checks out the trade could be short term riskier but long term more neutral or even less risky. Why? Don't assume the analyst path/stability of history is going to repeat in the future. You are still in an ok spot now but i don't think you want to be a 40-45 year old analyst. With all the resources out there/direct to buyside/earlier specialization there is not really that much of a difference in output from a 45 vs. 35 YO analyst (comp expectations another story). Not to mention AI/industry dynamics likely put further downward pressure on the average LO's number of analysts. Putting this together i'd argue it is risky not to try to be a PM by early 40's...yes we all know those 55-60 year old veteran career analysts but honestly don't think that is an advisable replicable career path in today's day and age (harder to move to new place at 45 IMO too as places like to "mold" even if only for culture). In a sense I'd be thinking more about is this specific one the right opportunity to leave for bc I think you do need to leave eventually.
PM or out is thw new rule of the game.
that is a problerm for most then since the amount of quality PM seats is shrinking and there is a long list of (internal) analysts waiting
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