Already at a HF, does it make sense to go to B-School?
28-year old working at a decent single-manager hedge fund as a quant researcher. There is no path to senior mgmt as far as I can tell out of research. Been offered analyst position on trading desk, but got feedback from a friend on the team that there is no path to mgmt from trading team either (even for guys who've been there for 10-15 years and put up solid numbers). The head PM was recruited from bulge-bracket and nearly all the senior mgmt came from the outside.
I can either stick to research, try to switch to trading (in a very junior role) with significant decline in work-life balance and no obvious path to mgmt, or I can try to go to B-school (Harvard, Stanford, Wharton) to swing for another fund or some other industry. Concern with B-school is obviously time, money, and the fact that I am coming from quant background instead of IB, which seems the best syncronized for b-school outcomes (i.e. PE recruiting).
I have strong stats which I am keen to not let go to waste in a career trajectory that leaves me in middle-managment (at best) by the time I am 40-50.
Stats: ~3.9 GPA from Target, 335 GRE (equivalent to 770 GMAT), strong recs from professor at HYPSM and Head PM or Head of Research at my firm.
good shit man
Maybe I'm missing the joke, but in what world is PM at a HF a mediocre middle management position? Sounds like a clear path to seven figure comp with performance linked upside.
Gotta remember it's a single-manager fund... The head PM is the one making 7-figures, the other PMs don't clear 7-figures (maybe high six-figures on a crazy good year).
Also PMs in a single-manager structure are, by definition, middle management.
Are there even PMs in SMs? Single manager innit? Just the founder and his analysts innit? Unless they're moving towards inflated titles to keep egos under check like what Citadel is doing (Snr PM, PM, analyst) and do a structure like head PM (the founder) and PMs who are essentially assistant PMs who don't assume PM responsibilities
If PM's aren't clearing $1M in good years, something is wrong with the economics of the fund, I'd apply to other funds if that was the case. Analysts at good SM's can make $1M+
Not all funds are the same. Can't really make these broad-based generalizations across all funds and asset classes.
facts
Malibu coast where i meditate
If you’re at a SM that has good PM’s not making $1M in a good year, something is wrong. Bad returns, too much headcount, etc. example. An SM with $500M AUM with 6 IP’s making a gross 15% return (decent year) will generate $11M incentive fees. In what world are the 1-2 PMs not making $1M from that pool? You don’t have to scroll far in the comp thread trending to see this is the case
The founder and head PM are the ones usually wiping the plate clean.
Feel free to use this website to checkout the home prices of people you know who work at these funds: https://www.realtyhop.com/property-records/search
Doesn't make sense to be clearing 7 figures every year but only buying a 1.5 million house with a 800k mortgage...
When that situation happens, PM’s leave. The beauty of hedge funds include obvious yardsticks for how much money you make the firm, and how much you should get paid for it. The house comment is such a vague random comment I don’t even want to engage. If you’re good at making money, at a fund at 28, someone will pay you millions of dollars in the next ten years.
Whats the fear of staying in the QR track? It seems like the problems stem from the fund which you are at?
Surely either lateral to a MM or smaller hedge fund and ask for strategy PnL linkage if you have risk appetite, or move to a larger pure quant fund where QR is the prerequisite to a PM seat (afaik 2sig is like this).
Why on earth would you ever want to do PE recruiting?
Definitely not interested in PE recruiting. But you are right that the problems are pretty unique to my fund (which the previous commenters seem to not understand). My quant skills aren't at the level of Two Sigma, so not really an option either.
QR track has pretty low headroom (taps out at mid six figures). PMs at my fund (excluding head PM) tap out at high six figures, maybe very low seven figures in a spectacular year. We're also in a pretty niche asset class so the previous commenters saying you just just go to another fund have no idea what they are talking about. There aren't enough seats with large enough PnL for these guys to switch to or else they would have instead of hanging around for 10-15 years without even getting a proper office (still just a desk on the trading floor).
I wouldn't bet against yourself not being good enough for 2Sig. The folks there are smart but not geniuses, and there is so much variability in experienced hires from what I know that as long as you have some alpha that slots into a team it could be game on.
QR headroom is like getting stuck at VP/Director level - if you get stuck as an employee you always tap out at mid-high six figures. But I know a bunch of late 20s lads who manged to get PnL attribution from some quant strategies. This was specifically at quantemental macro funds, not sure if that is common elsewhere.
Best advice I can say is probably to start recruiting all up and down the prop/hf spectrum. It seems like you want to increase your risk appetite so probably look at getting linkage at a smaller shop. The niche asset class might be slgihtly annoying, but assuming you have developed good QR skills switching asset classes is absolutely not out of the question.
Does QR at top HFT (think imc, jane street, etc) also tap out at mid-high six figs??
how much money do you make?
Quite a bit less than typical post-MBA Associate (< 200k)
i know tech is getting slammed right now but if you're a quant surely you have some coding skills..why not pivot to a tech company or doing some sort of SWE?
How does that improve my situation haha? I am trying to find a way to senior mgmt. Being a quant or SWE doesn't get me there.
I want more exposure to big picture strategic thinking at the org-wide level, not small time analytics to help some PM who has a hunch about some esoteric part of the market
tru
I went to one of these bschools (albeit a long time ago). Unless you are interested in completing switching industries and starting afresh, I'm not sure what, if any, incremental options it would open up that you wouldn't be able to get today.
Would you mind sharing your background and what if any impact you feel b-school has had on your career?
bump
Bro if you are 28 and making less than $200k at a hedge fund, and this hedge fund is soooo niche that you can't get another hedge fund job, then I think you should go to B-School. If you are really telling the truth, then your situation is the most crappy i've ever heard of. Most of it is on you though for choosing to go to a place with zero transferable skills such that the founder knows he can pay you and everyone else you work with minimum wage without losing you to other funds. That's on you man. Investment Banking analysts at 22 make more than you do. Go to business school and get into a proper hedge fund. If you have the stats like you say, and aren't a complete dunce in interviews, you'll be able to land at a second tier multi-manager with a path to PM (a real PM, that makes a % of their P&L which can net $5MM-$10MM+ in good years). I'm not even saying you have to get into Citadel/Millenium for the b-school trade off to be worth it. Literally any other hedge fund will pay you more with zero experience and have a higher ceiling as well.
This is the kind of feedback I was looking for. I guess the reason I've been holding back on b-school is that it seems like it's best suited for kids with IB backgrounds trying to go PE route, not guys from quant background just trying to swing for a different fund. Not even sure what asset class I would be swinging for post-mba to get a proper PM-track role.
But I agree with you that the pay is quite low for my age and stats (that said, I also don't work IB hours...).
Yes B school is best suited for that. Technically it’s best suited for consultants and people already in PE trying to stay in PE at a senior level because IB experience only kids will have an uphill battle getting into good PE post MBA. Anyways, even though that is what B school is ideally for, your situation is far from ideal, so you don’t need anywhere close to ideal. You just need to make a change, full stop. And if you can’t do it without B school feasibly, then B school will serve your needs just fine. Literally just pick an asset class and recruit for it. Whatever type of investing floats your boat, just go for it. The platforms cater to literally all asset classes.
What kind of strategy and asset class does ur hf focus on? Are you in structured credit?
yep, structured credit.
I get what you mean by niche now. But MBS/CLO aren't a small market and not tons of juniors. I have seen a lot of ppl go to multi managers like exodus point for these products. Would comp there be low too cus of the asset class?
Would you have a non-compete period? If you wanted to switch firms—and had a non-compete—you might as well go to b school. We have someone in my class (H/S/W) who is riding a non-compete while in school and it seems like a sweet set up
nah, no non-compete.
thats smart
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