I work at a long only family office as a generalist research associate, single stock, sector agnostic, market cap agnostic positions. I work directly for the head of the family who is an old hedge fund guy. We get in the weeds on these names, but he is not very model reliant, so I've taught myself some basic skills, tried Udemy's online class etc.
My goal is to work for a hedge fund, and I've gotten through some initial interviews at smaller funds, got to the case study for Point72 and I'm feeling that my modeling is not allowing me to get through the next step. I want to get better at modeling, not only for applications in the future but also just to be a better analyst.
Any advice as to what to do to enhance these skills as I'm not learning daily on the job?
Sent you PM
Plenty of courses out there! WSO has one, as well as other prep providers such as BIWS, WSP etc.
Thank you. I've looked through the classes and was wondering if that was the best route or if anyone has had success with a more personalized approach (someone more experienced charging for personal sessions or something of that nature.)
Raymond,
There are a lot of places to go to get free templates and education. Just have to look for them. I probably have 300+ templates that didn't pay a penny for, and I am deeply grateful for that (except for the grad school templates, which were very expensive). Here are a few that have been very helpful. Some have already been mentioned.
There are so many free templates and content. It just takes old-fashioned hard work, focus, intellectual curiosity, and a willingness to grind through it and learn it.
You got this!
Cheers,
MB
Aswath doesn't have professional, practical modelling courses like the others that literally prepare you to jump straight into a recruiting modelling test or onto the job. He only has nice academic and practical finance and valuation content and lectures. Not saying he's not an incredible resource tho
I am always looking for more advanced models that HF investors employ. I have access to sell side research models from a few firms and most of them aren't that good. Would love an actual model example that has a detailed breakdown of unit economics (detailed revenue / unit build + detailed cost breakdown) and various scenarios for stock buybacks etc.
I know the reality is that not all investors do the same thing so there is a lot of variance, but to see an actual pod shop model or good SM model vs.a BIWS annual model tutorial or a crappy sell side model where they have one line for margin as % and only breakdown segments and have two year projected quarterly with 1%/3%/2%/5% per segment (really just building to management guidance anyways).
My firm's models are mostly iterative of the SS model + my ability to do a detailed revenue and cost build, and we focus more on LT multistage DCF so the quarterly projections aren't as relevant here, but I am always curious how my work would comp against a "real" fund.
Feeling the same imposter syndrome with my models. Not sure if I am simplifying too much by not having a detailed revenue and cost breakdown outside of what is available in filings, etc.
Also at a long-term DCF shop so quarters don't matter for us but long-term margin structure and topline growth definitely do.
What is a DCF shop? Could you provide an example of one?
Also looking for some more info on this. Would appreciate any help.
Check out @fundamentedge on twitter. He's posted multiple threads on buyside approaches to modelling revenue, costs etc..
https://twitter.com/FundamentEdge/status/1547981913888919552
Also check out Rich Falk-Wallace on LinkedIn. He screenshots his models in his posts and you can reach out to him for one.
Funny enough I follow Brett and Rich already - in my mind it still doesn't compare to a thorough model from a HF pod or even sell side banking (maybe SS banking models aren't what I think they are though...). Rich posts abbreviated excerpts for one part of the model and a super condensed balance sheet - maybe a rev build here or there (nothing wrong with that btw - as most would say, focus only on what is important and complexity =/= accuracy). Brett had a good thread on model building with some screen shots for a Tesla model I believe. Would still love to see an in-depth buyside model on a name like TDG or DHR or GEHC etc. Give me like a parker hannifin model - bunch of short cycle indicators and various cost toggles and capital allocation plans.
Is it the modeling or the finance that is tripping you up? Sometimes, when you get to a modeling test or a real-life scenario, there is a twist on the basics and then all of a sudden you don't know what to do. For me, when I was younger, it was always the latter....not the actual modeling itself.
nobody ever got rich in HFs by modelling better than someone else
keep that in mind as you build your 100th 10 thousand line model
I think understanding the business is more important than building a 200 rows of model
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