I often hear that many PM started out in trading or research but most of the whales I know of were traders.
Do you guys think that the "market knowledge" vs. fundamental knowledge learned early on produces more famous PMs or are there plenty of PM who started out in research who I do not know about?
...one of the guys who got busted with Raj from Galleon was the former head of research at bear stearns. He ran a fund called New Castle and ran $2bn in equity long/short at his peak. Not famous but the guy probably has a net worth of $75MM+. And he started in equity research.
Klarman, Peter Lynch to say a few.
I believe Eric Sprott started out in ER with Merrill Lynch in the 70's.
He was a billionaire at his fund's IPO. Now he's probably only worth ~$500 million.
James Chanos, Einhorn (started IB, but switched to research at HF)
If you count "research at HF," it's like every manager of a fundamentally driven fund (because what those funds do is...research). But if you mean sell side research, then scratch Klarman and Einhorn (mentioned in above posts). Also sell side research has changed a lot from what it was ten years ago, so not sure its fare to compare anyway.
Worth bumping this thread just for the post from 09 that talks about Raj not being famous. Ha.
um i wasnt refering to raj i was refering to the guy who got busted with him and recently pled guilty. raj was worth many multiples of 75mm.
ha misread your earlier post, sorry about that. jokes on me.
Although, actually, the joke's on Raj.
Stephen Mandel was at GS research before Lone Pine.
learn the game before you play it, right?
Druckenmiller started in equity research and I'd say he did quite well...
As did Soros if i'm not mistaken. But this was a long time ago, I don't think that you can now go the ER=> global macro/econ route.
No, he started off selling purses on the streets of London.
It depends on the strategy of the fund rather than just that most famous PMs came from one area. For instance, you'll be hard pressed to find an Equity L/S or Distressed PM who started as a trader, or a Global Macro PM who started in fundamental research.
The founder and PM of the fund I used to work at was a star research analyst and became one of the youngest Senior MD's in his firm's history before starting his own fund that hit >$1bn AUM at its peak.
Many PMs have started out in research, but you have to recognize that sell side research before 2003 was a much more prestigious and valuable job than after 2003 when the global settlement separated research from banking and made research analysts less valuable to investment banks. My point is that, before 2003 there were incentives for talent to flow to the sell side, but after 2003 there have been less incentives (especially with the rise of hedge funds), so I would expect the number of 'star' PMs coming out of sell side research to decline going forward.
^^Where do you think the star PMs will becoming from in the future? Do you think they will start at the buy-side immediately, after UG/Masters?
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