Best Public Markets Gig? ER, MM HF, SM HF, or LO AM?

Given that SS ER, MM HF, SM HF, and LO AM seem to be the most common career paths for public equities in that order, thought I would pose the question: which job would you take and why?

Understand there's a ton of nuances and exceptions to each role, but am more trying to see what the natural consensus is on this site

Which job would you take, all else equal?

Sell Side Equity Research (Top II Team)
3% (12 votes)
Multi-Manager Hedge Fund (Big 4 Pod Shop)
21% (73 votes)
Single Manager Hedge Fund ($5bn+ AUM)
42% (144 votes)
Top Long Only Asset Manager
33% (114 votes)
Total votes: 343
 
Most Helpful

The answer is it depends. There are some SM seats that are better than MM, LO, and SSER seats. The same can be said for each position. Almost universally, this forum will say, buyside>sell-side, but there are compelling reasons to stay on the SS in ER. People that prefer the sell-side moreso enjoy the pure research aspect of the markets rather and don't have much appetite for risk. Aside from that, each buyside seat has their own pros and cons and anyone that tells you that one is better than the other is giving you bad info.

 

Big difference in seniority when considering MM/LO

Senior analyst (with sleeve) at MM and analyst (PM track) at LO comparable to the top SMs

Junior analyst seats at MM and research associate seats at LO are generally much less desirable

 

Why are LO research associate jobs less desirable?

isnt recruiting more difficult than L/S?

 

ER all too busy writing up the 18th paragraph of their 1Q24 preview note that only compliance will read lol

But in all seriousness, would second that this site skews heavily buyside, with the vast majority falling into the HF camp. So would expect HF votes to lead the polls.

As for sell-side ER, I think working at a top II shop has the potential to be a great seat, but often ends up being less attractive in the LT because top ranked teams tend to work significantly longer hours than the average group (at least in my experience). I think this lends itself to a lot of ppl leaving on the premise that they could work potentially less hours on buyside with more upside potential in comp (similar to the IB vs PE debate). This case is especially true at junior level when you're not in control of schedule/directly receiving economics of more broker votes, and becomes less the case as a senior -- also seniors who stay are a selection bias themselves (i.e. some enjoy thee ego of being a top-ranked analyst, traveling a lot, and don't value WLB as much).

Also, I would think those who are voting LO are likely assuming a PM-track seat (which is only like 10-20% of seats). Otherwise I would venture to say SS ER with MD-track seat >>> LO AM without PM-track seat.

 

I don't think a $5B+ SM is fair for this given how few of those seats actually exist (I'm talking about true $5B of L/S equity assets, not funds w/ a bunch of LO assets too). There are like 10-15 of these funds and a total of a maybe 200 seats max?

I don't even think Lone Pine has $5B in their L/S equity fund anymore... most of their assets are Lone Cascade which is L/O fund.

A >$2B fund is more fair comparison.

 

I’d agree with this, but would caveat to say that there are plenty of SM HFs with AUM >$5bn if you include net long, distressed, opportunistic, and special sits 

 

Kind of asinine to compare top LO vs top SM vs generic MM

But then again there’s no such thing as a ‘top MM seat’ necessarily - just those who do well and those who don’t

Comes down to whether you want your comp to be defined by your seat vs your performance - you get the upside but also the downside to the latter at a pod

 

Can you share more of your thoughts with respect to making this transition?

LO guy here thinking about going MM

 

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