how to break in?
What does it take to get a job at a large hedge fund? Do the 1bn+ funds mostly take analysts from BB banks? How can they distinguish between all the young guys who do not have much of a track record? Is it better to stick it out at a bank until youre an MD or make the move ASAP?
Also, is it significantly more profitable to start up your own hedge fund or do big funds pay a generous enough percent of PnL that the risk of starting a new fund does not justify the reward?
from the outset; that's not to say you shouldn't. ken griffin, warren Buffett, etc etc, there are ppl who have become great investors from the beginning.
if you are more risk averse or can't the raise the capital to do the former, i would say jump into a hf as soon as possible, if this is your goal ultimately anyway. the sooner you get on the buy/investment-side, the longer you have to learn how to invest, as opposed to being a banker for that period of time (just common sense, obviously).
getting jobs at funds is a combination of luck, preparedness (not necessarily intelligence i would say), familiarity with the space that you're applying to be in, and sometimes pedigree (what bank you are from); but i've seen ppl get in from all different angles. i'm trying myself right now, but i'm also looking at other types of opportunities as well.
i would say just be persistent; that's what i'm trying to do. also, you don't have to limit yourself to +1BN funds; however, if you widen your scope, do so carefully, and due diligence the funds you interview with very meticulously
I wouldn't downplay intelligence- a lot of the HF interviews are absolutely brutal on "intelligence testing" much more so than consulting case studies or trading brain teasers. Banks hire a few candidates from a pool of students from top schools, hedge funds hire a few candidates from banking (an already small pool) so the bar is set much higher.
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