Opportunistic Hedge Funds - UK
Friends!
As 2023 approaches, I've had many existential crisis about 1) what is the next big thing in finance, 2) what is the most commoditized niche, 3) what I'm good at, and 4) what I'd love to do.
As a background, I'm at BB M&A classical coverage team. I do like my job, but I don't find in intellectually stimulating, and I don't see myself being an Aso, checking markups of sleepdrived analysts that want to exit to PE and don't give a shit about work.
So, I'm thinking about my next step in life, and after tons of conversations with different professionals in different spaces, I came to these conclusions:
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I like PE, but I like funky PE - special situations, complex situations, where there is no straight answer and you have to think how tf we can come up with an investment idea that can make monies
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I like HFs, but similar to the funky PE stuff I've said earlier. I like to think about macro ideas, that then can be converted into actual trades (basic example: Unemployment is increasing, affecting crime which is going up. We should check private prisons and see if there could be a trade there)
So, with that said, I think I've two clear options:
Going to anything on private markets that has a special sits team or whatever is called these kind of teams. Or going HF space, and work for people similar to the likes of Pershing Square, etc, but the European names.
So after all this, now I would appreciate your input and knowledge. Do you have any European PE & HF names that could cover these characteristics?
I'm looking to explore any options, from small pods, to classical established funds like King Street, Taconic, etc.
But I'd like pods that are more risk taking than these guys (the ones mentioned above). Ofc, this is in the context of EU/ UK. I don't think I'll be able to get hired from any US pod :)
Thank you!
Excellent thread, following, this investment mindset fits me to a T, although I'm interested in real estate as well.
1) I don't think you know what the term pod means given how you're using it interchangeably with the term hedge fund. A pod is a specific team that works at a multimanager hedge fund like Point72, Citadel or Millenium which are typically called podshops. - Disclaimer, I'm interning at one of these places so don't know too much about investment styles at other funds, especially in London since I'm not from the UK.
2) The investment style you've mentioned is quite generic in that you have a thesis and then a chain of effect/catalyst or w/e. You probably want to get more niche about what you want to evaluate and focus on. You're doing IBD so I'm gonna assume you're not interested in the big macro players like Brevan Howard etc and want to work in L/S equity but it really depends how much of the macro picture you want to look at/consider.
Podshops tend to trade over shorter time periods and are beta constrained, even if there's a big macro factor at play they're primarily doing bottoms-up analysis of single-name stocks in a specific sector to see who's got edge and will capitalise the most on the changing conditions. However, its still quite granular and evaluating the trees rather than looking at the whole forest and I'm getting the impression you want something which has more conviction in making big sector trades based on a macro/gepolitical event. You'd want to look at smart-beta/factor shops similar to the tiger cubs and maybe even activism. I'd have a look at TCI, Edgerton and Ako since they're the only names in L/S I know of in London but I hear hiring there is quite sporadic.
You do ofc have Citadel/Point72/Millenium and Balyasny in London too since they're global firms.
3) Have a read thru this: https://www.dickthesellsider.com/blogs/news/long-only-vs-long-short should help you understand the differences between L/S styles and types of firms so you know what you're looking for across the pond. Courtesy of [dickthesellsider]
Thank you! This is very helpful!
I just got shit from an associate for sure lol
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