L/S Case Study
Hi all - I've been in conversations with a L/S SM fund in London and made it to the case study stage. I've spent the last 5+ years in PE with limited HF recruiting experience so wanted to see if anyone had any advice with regards to the delivery of the case study (i.e., write-up vs. slides, "typical" length, should the document stand on its own or do you introduce concepts that you then expand upon during the in-person presentation, etc.).
I appreciate the case study will be evaluated almost exclusively on substance over form but figured I would ask for any advice about best practices here.
Thanks in advance!
Hey there! It sounds like you're gearing up for an exciting opportunity. When it comes to case studies, especially for a L/S SM fund, it's crucial to demonstrate your analytical skills and ability to make sound investment decisions.
For the delivery, it often depends on the fund's preference, but both write-ups and slides can work. If you're going with slides, make sure they're clear, concise, and visually appealing. If you're doing a write-up, clarity and thoroughness are key.
The length can vary, but aim for comprehensiveness over length. It's better to have a shorter, well-articulated analysis than a long, rambling one.
As for whether the document should stand on its own, it's generally a good idea to make it as self-explanatory as possible. However, you can certainly introduce concepts that you plan to expand upon during the presentation. Just make sure it's clear that's what you're doing, so the reader isn't left confused.
Remember, the goal is to showcase your investment thinking, so make sure your analysis is thorough and your recommendations are well justified. Good luck!
Sources:
Definitely have a one-pager where all the main points of your case stand out: thesis, catalysts, financials, risks, background.
Then you should ponder whether the HF you are recruiting for is process-heavy (value with a long term and deeply fundamental view) or not. I have limited experience with cases, but no purpose in writing 40 pages. Ofc be ready to go deep in the analysis of industry, etc, which won't be a problem given your background, but don't get lost in your write up. Probably 10-15 pages are more than enough. It will be up to you to discuss it covering every angle once you'll have the interview.
HF tends to be more focused on substance than form, show you get it and you know what matters. Being concise is a requisite.
Thanks, appreciate your input!
without revealing your interview spot, did HH directly reach out or was it more a direct approach from your side?
answering your question: i would just stick to the key points/stick to the bigger picture (thesis, catalyst, rationale #1-#3, risks, valuation etc). in terms of formating (doc vs ppt), this is highly fund-dependent but in case I would keep it concise (as the previous poster has mentioned).
Thanks for the input! On this particular opportunity the initial intro was via a HH but since then I've been communicating directly with the team.
It should be written like a memorandum in word unless instructed to do differently. Basically you'll be asked what your thoughts are on XYZ company/security with very little direction on anything else.
For at home case studies, you should have a good two to three page written memo that outlines and describes your thesis with a full three statement model built (especially if interviewing at a multi-manager hedge fund). Make sure to spend a lot of time trying to figure out a differentiated view. You will likely get dinged if you just present the consensus view and nothing else that is interesting. Anyone can read sellside reports and outline the consensus view.
You should focus less on specific assumptions and more on why you think a company is going to miss or beat earnings over the next year or two. Determine a good thesis that translates into upside or downside to street estimates. Anything around why you think expectations are too conservative or too aggressive is good to note. You should go through filings, investor presentations, transcripts, sellside research (if you have access), and look at what the company puts out there in terms of guidance (as these guidance numbers are usually what most people on the sellside use to model out earnings). Would first focus on building the model using the guidance numbers given by management. Then change the assumptions based on your thesis and compare where and why you are different with the sellside consensus.
Basically you need to do the following (summarized below but have more detail in the link below):
For more info, I wrote a complete case study guide that walks you through everything step by step:
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