Best Way to Prepare for a Fundamental L/S Internship?

I recently received an offer for a Summer 2027 fundamental long/short internship and have about 10 months before I start.

For those who have worked in public equities, how would you recommend preparing?

Interested in anything from modeling and earnings work to idea generation, investment write-ups, shorting, and building a repeatable process.

My goal is to show up as prepared as possible and already thinking like a junior investor.

Would appreciate any advice.

8 Comments
 

To prepare effectively for your fundamental long/short internship, here’s a structured approach based on the most helpful WSO content:

1. Stock Pitch Mastery

  • Know 3 Stocks Inside Out: Select three stocks relevant to the fund's focus (e.g., mid-large caps if applicable). Be prepared to discuss them in detail, including:
    • Management
    • Historical performance
    • Margins
    • Key drivers
    • Your recommendation (buy, hold, sell) with a clear rationale.
  • Practice Investment Write-Ups: Write concise, well-structured pitches for these stocks. This will help you articulate your ideas clearly during interviews or discussions.

2. Modeling Skills

  • Focus on Fundamentals: While modeling isn't typically tested during interviews, being proficient by the time your internship starts is crucial. Practice building models like:
    • 3-statement models
    • DCF
    • Comps
  • Resources: Use tools like Wall Street Prep or similar platforms to refine your skills. Aim to reduce errors and improve speed.

3. Reading and Research

  • Books: Continue with your reading list. Books like The Intelligent Investor and You Can Be a Stock Market Genius are excellent. Add others like Common Stocks and Uncommon Profits or Margin of Safety for deeper insights.
  • Industry News: Develop a habit of reading WSJ, Barron’s, and FT daily. Stay updated on market trends, earnings reports, and sector-specific news.
  • Reverse Engineer Investment Theses: Study successful investments by respected funds. Analyze filings and reports to understand their decision-making process.

4. Idea Generation and Process Building

  • Develop a Repeatable Process: Start building a framework for idea generation. This could include:
    • Screening for undervalued stocks
    • Identifying catalysts
    • Assessing risks
  • Shorting: Learn the nuances of shorting, including identifying overvalued stocks and understanding the risks involved.

5. Earnings Work

  • Practice Earnings Analysis: Review earnings reports and transcripts. Focus on understanding how companies perform relative to expectations and how the market reacts.

6. Networking and Mentorship

  • Engage with Professionals: Reach out to analysts or professionals at the fund or in the industry. Their insights can provide valuable context and guidance.
  • Smaller Hedge Fund Experience: Leverage your time at the smaller hedge fund to refine your skills and gain practical exposure.

7. General Habits

  • Discipline and Consistency: Develop a routine for research, reading, and practice.
  • Attention to Detail: Cultivate habits that ensure accuracy in your work, from modeling to investment theses.

By focusing on these areas, you’ll position yourself as a well-prepared and thoughtful junior investor, ready to make a strong impression during your internship.

Sources: Q&A: 3rd Year Hedge Fund Analyst, How to get a Hedge Fund Internship, Hedge Fund Careers: Getting a Hedge Fund Job Out of Undergrad and Beyond, https://www.wallstreetoasis.com/forum/hedge-fund/the-hedge-fund-experience-good-bad-ugly?customgpt=1, How to prepare for summer ASSOCIATE internship

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

Modelling 

And then spend time tracking a few stocks, and modelling the KPIs quarter to quarter, try get a feel of what matters and what the stock is moving on.


I’d also spend some time thinking through bigger picture themes and trends, what is the current trade? How are yields moving, how are indexes and sectors moving, what does that tell you about the regime we are in

 

I joined out of undergrad 

Long term it makes no difference. In the shorter term there’s a general view that the kids coming out of school (and surviving the grad programs) are materially better. But that is to be expected. 

Otherwise these programs wouldn’t exist. Some of the larger/better teams at my firm rely on taking someone out of the grad program each year, but still hire laterals

 
Most Helpful

You can PM. Honestly come in being very coachable and have some competency with modeling, ie. if someone asks you to look at X name you should have some sense of how to do a segment build or think through how to model costs or rev. There is usually 1-2 KPI's etc that stocks trade on so being able to identify that and work through that should be value add when you are pitching or chatting. A big part of succeeding at these places during undergrad is being useful with tools or data in a way they are not or at least unfamiliar with...for instance during one of the HF internships I did I showed my PM how to scrape wayback machine with some added tooling to fill in missing gaps etc and was able to build unit economics off that information for a name we were lacking info for. 

 

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