Are HFs a Good Place to Start a Career?
I'm going to be graduating soon and be working at a MM HF (i.e. Citadel/Millenium/P72) but I'm having doubts about the HF industry and whether it's best to start my career here or not. I wanna skate where the puck is going and it's becoming harder to justify going into the HF space for this reason. My goals are to be working in an intellectually stimulating and growing industry with a high compensation ceiling in the long-term.
I feel like the fundamental HF industry is mature, even potentially shrinking (at least compared to other asset classes like private markets, mutual funds, etc.) but I want to be proved wrong. If you're working in a fundamental role at a HF, what are your thoughts on the common criticisms of the industry? A few off the top of my head include shrinkage of publicly listed co's, increasing saturation of HF analysts, growth of private markets, job and performance volatility, etc. Thanks!
I would worry a lot less about the industry - particularly since you’re in like the one sub-segment (pod shops) that is actually growing and indisputably generating consistent alpha.
I think you’re right though to question whether a pod shop seat is the ideal place to start a career. I did the IB/PE route before eventually transitioning to public markets. May be biased, but I think that’s the ideal career trajectory as you get the training in IB and the fundamental investing reps in PE. The reason I prefer starting in privates is because the diligence is much deeper (you just have so much more info and analysis you can do) - always easier to eventually trade depth for breadth rather than the other way around. I also worry about the branding risk of MMs (short term, calling quarters, job risk) so early in your career
My advice would be to play by ear. Soak it up, learn as much as you can for your first 12mo, and then reassess. Can always pivot to IB at that point and do a little reset. All in all, first world problems- world is your oyster
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