L/S Equity Hedge Funds - Long Term Career Prospects

L/S equity hedge funds historically were a high compensation, high career volatility sort of place. But for those who succeeded it was one of the most lucrative career paths out there. Now there are a lot of pressures L/S equity hedge funds face between 1) fee compression, 2) shrinking alpha opportunity, 3) stagnant net flows from investors, and 4) a shrinking investment universe (companies are staying private longer and given merger activity the number of publicly traded companies is 1/2 of what it was 20 years ago).

So my questions are:

  • 1) Is it still worth going down the L/S equity hedge fund route? Will this business exist in 10 - 20 years?
  • 2) Are there other types of hedge funds that are still attractive from a career standpoint (for someone with a corporate finance background)? Again not talking about strategies that require very different skill sets (e.g., a quant trading firm can kill it but often requires more of a programming / math PhD sort of background).
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