Firms That Give Analyst P&L / Carve-Outs
Apologies if this has been asked before, but does anyone know which MM (or maybe even SM) funds give Analysts directly trading and P&L responsibility for the stocks or sector they cover? I know each MM has a different approach and it can be heavily PM dependent, but for instance Citadel seems to let most Analysts the ability to put on trades themselves while I've heard Point72 Analysts only generate ideas.
I'm currently looking to make the jump (from idea-generating Analyst to somewhere where I can put on trades myself) and would appreciate any firm-specific insights. Thank you.
Most relevant for trading as you'd expect since those are frequently adjusting/mark-to-market performance books.
As for longer hold, Viking has some analyst P&L.
Bump.
I'll be interested in this topic as well - ie for analysts at MM platforms who consistently generate positive pnl or trade ideas what is the typical process to move from pure idea generation to actual carveout where analyst can have direct trading control over his own p&l.
if you want P&L....then you should just apply to a MM like millenium to be a PM yourself and run your own pod.
live or die by your P&L
Please name a single analyst with no P&L track record that's been extended an offer to be PM at MLP. I'm not aware of any.
To answer the original question, Analysts at Citadel have their own sleeve with trading discretion. "Associates" are junior to Analysts and don't have their own P&L. Citadel does hire Analysts that don't have a track record per se. They do tend to be relatively senior guys that have followed their sector for a long time.
As for other MMs, it's on and off. I knew some analysts at MLP that had their own sub-book under the PM.. i think it's on a team by team basis depending on the PM.
i know a few sales guy that got seats at MMs...and a bunch of rates research guys (essentially analysts) that got PM / trader seats....not exactly the same thing....but in the ballpark.
If you are making trading recommendations (including price entry/exit levels and they get hit) and have been tracking the performance (does you portfolio ever go down more than 5%) then this is doable. The MM firms are always looking for new PMs, and they have plenty of spare capital to deploy.
Thanks for answer MMPM. I don't know what the other guy is on about; haven't seen that happen either. Generally, it's tough to even get the PM spot if you haven't been a PM before or have no track record with direct P&L linkage.
The other consideration I had too is that if you're primarily focused on a sector, it only makes sense to work under a PM so you can help spread the risk across more names / larger coverage. Do many sector specialists than ever really get to the PM level? I've been covering a specific sector for a while now that has maybe 50-70 companies but I'd only ever have 10-15 max ideas with good conviction; however, it'd suck to be relegated to work under someone else who may have a very different thought-process and approach and given prior experiences I hate being reliant on someone else's performance for my own job security.
Also thanks for the info on Citadel and Millennium - but it seems like that info is well known / out there. Do you know if it's any different at others like Balyasny, Cinctive, Schonfeld, ExodusPoint, Verition, etc.?
question answered
At most MMs where analysts are running carveouts, their P&L is consolidated with the PM's. That means that a PM that is flat or even making money personally could get his ass fired if his analyst doesn't know what he is doing. Hopefully you can understand a PM will try to avoid this scenario.
The analyst needs to prove to the PM he can be trusted not to blow up. This means not just "making money", but doing so with low volatility, a healthy batting average, etc. If you made money on one lucky position where your long was acquired and with a lot of volatility and drawdowns in between, your PM is understandably not going to credit it as much as if you make money every month with limited vol/drawdown and most of your positions work.
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