Comments (28)

8y 
mrchow, what's your opinion? Comment below:

other way around bro

8y 
GBB_19NHS, what's your opinion? Comment below:

people dont really got to business school from hedge funds in the first place. surely all the big ones would get you in if you really wanted to go that route (even though its pointless)

"too good to be true"

See my WSO Blog

8y 
FranciscoDAnconia, what's your opinion? Comment below:

Only thing I can say with conviction is that the HF industry is not for you OP

  • 3
8y 
PeterMullersKeyboard, what's your opinion? Comment below:
FranciscoDAnconia:

Only thing I can say with conviction is that the HF industry is not for you OP

.

"When you stop striving for perfection, you might as well be dead."
8y 
Gray Fox, what's your opinion? Comment below:

The math gets hard to justify b-school once your at a top hedge fund. Assume two years of wages after taxes are $500k, plus another $100k of tuition. $600k compounded at 12% is $18mm in thirty years. Will b-school increase your lifetime earnings by $18mm? For 99% of people definitely not. It may make sense if you want the prestige/branding but that is a lot of value to bet on an intangible asset, particularly when being a top fund already goes a long way in terms of branding.

8y 
Another, what's your opinion? Comment below:

I've never heard of it being industry standard for an HF to be paying 325k/yr to someone under the age of 28. You bring up a good point about opportunity cost, depends on the OPs end goal.

8y 
FranciscoDAnconia, what's your opinion? Comment below:

Mean/median pay at the large AUM value, L/S, activist and distressed funds with small headcount is more than that. Just think about the economics for a fund like SPO running ~$11B with ~10 investment professionals on a 2/20 structure returning even just SPY. Half a mil payout to each of your 5 or 6 analysts is a rounding error.

8y 
TheBig, what's your opinion? Comment below:

Would you consider Columbia's AVI program an exception to the MBA value within the HF/AM industry?

8y 
mbavsmfin, what's your opinion? Comment below:

I agree that from a pure mathematical standpoint, it is very hard to justify. The top HF guys who do go seem to justify it by saying that they want to explore what else is out there beyond finance, make new global connections, and take a much needed break to enjoy new life experiences. Of course, someone who leaves the likes of baupost/greenlight/york/perry/viking to go to b-school is only doing it for HBS/Stanford.

  • 1
8y 
Cries, what's your opinion? Comment below:

banana for Gray Fox.

Would never consider going to Bschool unless I get fired and am un-employable.

Array

8y 
GBB_19NHS, what's your opinion? Comment below:

that pay is pretty standard at the big funds, and pretty much nobody has an mba or would ever consider getting one. precisely if fired maybe but even then, why bother

"too good to be true"

See my WSO Blog

8y 
Bondarb, what's your opinion? Comment below:

hedge fund pay is highly variable but 350k at age 28 is not absurdly high...maybe a touch on the high side but not out of the question. At 28 you are likely some sort of analyst or execution guy and have been doing it for a few years...somewhere in the 250k-300k range is probably about normal at that stage. If you are a "fast-riser" and have gotten a few lucky breaks and are either a strategist-type tied to a successful PM or are a young PM yourself the pay can also go signifigantly higher then that.

Best Response
8y 
Gray Fox, what's your opinion? Comment below:
alman:

If I was going to flip it...would it make sense to go to b-school if you're at a long-only value fund (>$10B size - fee structure is definitely not 2/20) and want to use an MBA to get into a L/S fund. In a way it seems like it can be a hard sell.

Why leave? Are the people there talented? Is the work rewarding? There are lots of long only funds that are full of talented people and lots of L/S funds that are full of morons.

Read the Sequoia transcript. Somebody asked about talent retention. Poppe straight out said "everybody but me is massively overpaid". He qualified it with the culture, rewarding process, etc (which is all very true) but long only can be a good thing.

Shorting stocks is really freaking hard and probably best done in a diversified manner. A lot of high profile HF shorts looked great in 2007/2008 and looked really stupid in 2009-2014. Shorting is incredibly tax inefficient, has a capped upside, and limited downside. L/S is so popular because institutions like it, not necessarily because it is the best way to run money over time.

Sorry for the rant, several L/S funds recruit at Columbia/Harvard/Wharton and I'm sure Stanford (no real West Coast experience). Good long only experience is probably viewed as favorably as banking once you are coming out of business school.

8y 
alman, what's your opinion? Comment below:

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