Worth holding out for SM HF - London
Currently weighing offers from BB IB vs an undergrad programme at one of the MMs, both based in London. Idea with IB would be to exit to PE -> SM / SM straight for the comp upside but not sure if SM seats comparable to good US ones with much better economics vs MM are even a thing in the UK? Based on quick research the pedigree of analysts at well-known UK SMs seems not very comparable to US in terms of the BB/EB -> MF PE CV, or am I looking in the wrong place? Looking for advice specific to UK market please, not trying to start the age old debate again.
easy choice imo, if you love markets and want to be in L/S, go for the MM with your eyes closed. in 2 years time, you against a IB-2 is a no Brainer for a SM. A lot of what you learn in IB is not transferable to HFs, even from a work flow perspective.
A few “top” SMs aren’t going to hire some kid that did Citadel’s associate program Vs a known quantity that did a standard IB gig and blends well with their fit. Just not how the big SMs in LDN tend to hire, when they do hire that is
it depends on the house really, I am at a HF right now and do not see the edge of being in IB over someone who did 2 years at a MM.. obviously your experience is dependent on the house with P72, Balyasny being more on the formative side.. True some people would prefer IB backgrounds but to each their own... You will learn a lot sitting next to a PM, the technicals you pick up by yourself...
Talking to friends in IB/ big PEs, a lot of them do not get much modelling exposure vs. HFs in the first 2 years.
Depends on the MM tbh. P72 Academy is probably the most refined for training.
The SM’s you’re thinking of hire very sporadically and from all over. Unless you’re trying to work at Elliot or Viking, the idea of having that “top” pedigree isn’t as prevalent. They hire from a range of ER/IB’s as long as they’re reputable
Personally I’d lean towards the BB; gives you more optionality and less early career Vol. That mm seat will always be there if you’re committed to public markets.
This isnt the US - you dont need PE for SM. They dont really care where to hire from and start by looking at people from IB / other HFs. Issue with them is that a seat opens up every 2 - 5 years. They focus a lot more on word of mouth/networking and getting in is more random than anything. yes there are sm that compare to the US and some are even better than most US funds, but getting a seat there is like winning a lottery ticket
You need to decide what you want to do in your future. If you are deadset on public markets, would recommend IB vs the MM route for a lot of reasons I mentioned before on my profile (something to fall back on if it doesn't work out as mm pigeonholes, gives you time to diligence what pod you are going into, what sector you want, you can read through my comments - written a lot about this).
You can indeed go from a MM to a SM in the UK but it becomes even more difficult than coming from IB - I know all of the people who did it in UK to well known funds (about 4 people) and the 2 common things they said was 1) it was very difficult, and they constantly had to justify why and how they are going to turn in a value investing mindset, even had to study for it 2) they were rarely asked about the MM experience if they had other experience - one of my close mates who recently went to an amazing SM told me that in all the interviews he had, all the job specific questions were aimed at his prior job before joining the MM (so they basically disregarded the MM experience completely)
Were any of these people coming out of the undergrad programs at the MMs?
Yes 1 person (wont name to not doxx) - rest had other experience. Going from MM to SM in UK is possible as proven by these people but its very difficult (esp if its your first job). you'd be better of going to IB if your goal is a SM (or even MM since you can always go there after your analyst years)
If I wanted to play the lottery, what are the funds you'd consider to be a winning ticket? Understanding it likely takes a lot of randomness / luck to get there.
SM market in equities in Europe has undergone a massive downsizing and structurally, it is a shrinking market. Lack of sizeable launches on top is all that you need to know.
Don’t even bother wasting your time on SMs in the UK. They effectively don’t exist
I think IB or ER are equally valid for SM land in London. I'm not sure PE to SM HF moves are that common - some firms do actively look for it / take a PE DD level approach to public equity investing and therefore their hires.
US funds tend to be larger and have more structure to them (e.g. Viking, Coatue etc.) and therefore hire every year. London based SM funds tend to have investment teams of CIO + 2 to 6 analysts with limited churn. The main thing is being on the radar of funds when they do have an opening and knowing the prime brokers on the fund/launch (typically MS, GS, UBS, BofA, JPM in Europe) who will be providing consulting/talent acquisition services by suggesting candidates to the SM/new launch.
There SM market is likely at a cyclical low (personal view) in Europe right now and there are a number of new launches coming down the pipe from what I hear so there will be opportunities. The simple reality is the EU market is smaller and less liquid than the US making running equity long short money at scale more challenging, especially with a continued growth in the number of pods being deployed in the region adding additional crowding risk/vol to many names.
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