Energy IBD --> Hedge Fund - Is It Possible?
Hi there,
I am an incoming intern at a BB in London and I have been seriously thinking about going for the Energy team this summer, as I have a lot of interest in the space. Having been active in the student fund at my uni, I am also attracted to the idea of exiting to a HF further down the road. However, I have so far not seen many people with Energy background going that path (my point of view is very limited though). Therefore, I would be very grateful for any insight on the below questions.
How active are HFs in the energy space? How common are HF exits from energy teams/infra funds? How difficult is it to exit into a good PE fund from a good energy group at a BB? Is there any inherent advantage in doing IB/PE focused on more traditional/less-commoditised sectors?
Thank you!
JP Natural Resources had an exit to Baly. In fact people exit from all kinds of industry teams to HFs.
BTW your student investment fund is probably bullshit and you should not base your career plans on that
Yes, but on the equities side usually. Generally people hire out of IB for modelling skills, so the specific team is irrelevant. That being said more niche industries with specific modelling nuances (energy/fig) usually hire people in those coverages.
The best thing about being interested in energy is that you are pretty much alone in that preference, and therefore competition is more limited.
Of course if you take a minute to consider why nobody wants to do energy, things get more complicated.
Appreciate the response - could you please elaborate? Is it because of the decline of O&G?
Of course. It's a sector that accounted for 15-20% of the market some decades ago, must be only a couple percent by now.
IMO plan on going into PE and/or a corporate role before transitioning to an energy-dedicated seat at a HF. Of course, it does somewhat depend on your coverage (E&P, OFS, refining, etc), but I’ve been in this industry awhile and have hired several analysts below me. The ones that understand the intricacies of how businesses make decisions and create value in a hyper-volatile commodity business generally last, the ones that come straight from IB or ER struggle. I no longer touch resumes from applicants without PE or Corp Dev experience
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