Boutique LO AM (T2/3) vs MM IB

Based on the most helpful WSO content, here's how you can think about your options:

1. Boutique LO AM (Tier 2/3):

   • Pros: If your long-term goal is to be an investor, starting in a long-only asset management (LO AM) role can provide a strong foundation in fundamental investing. You'll likely gain exposure to equity research, portfolio management, and the nuances of managing money for clients. While it's not a Tier 1 firm, $40B AUM is still significant, and you can build solid investing skills here.
   • Cons: LO AM tends to be more long-term focused, which might not align perfectly with your interest in L/S strategies and short-term setups. Additionally, the promotion cycles in AM can be slow, and comp at mid-tier firms may not be as competitive as other paths unless you reach the PM level.

2. MM IB (Solomon/TD/Cantor):

   • Pros: Investment banking, even at a mid-market (MM) firm, offers a broader skill set and exit opportunities. If you're not 100% certain about your long-term goals, IB keeps more doors open, including hedge funds, private equity, and even corporate roles. The deal experience and financial modeling skills you gain can be highly transferable.
   • Cons: MM IB may not have the same prestige or exit opportunities as BB or EB firms, and the work-life balance can be grueling. Additionally, if you're leaning more toward public equities and L/S strategies, IB might not provide as direct a path as AM.

3. Endowment Fund (>5B AUM):

   • Pros: Working at an endowment fund can offer a unique perspective on asset allocation and long-term investing across multiple asset classes. It's a more stable environment with better work-life balance compared to IB or even AM. If you value a diversified investing approach, this could be appealing.
   • Cons: Endowments are typically more focused on asset allocation and manager selection rather than direct investing. This might not align with your interest in L/S strategies or short-term investing.

Recommendation:

Given your interest in L/S strategies, short-term setups, and public equities, the Boutique LO AM seems like the most aligned option. It will allow you to develop fundamental investing skills and gain exposure to equity research, which are critical for transitioning to a hedge fund. However, if you're still uncertain about your long-term goals and want to keep more options open, MM IB could be a safer bet, as it provides broader exit opportunities, including hedge funds, private equity, and corporate roles.

Ultimately, the decision depends on how confident you are in your interest in public equities and L/S strategies. If you're leaning heavily in that direction, start with the Boutique LO AM. If you're still exploring and want flexibility, go with MM IB.

Sources: Fork in the road: Career path in Asset Management, Asset Management vs Investment Banking 101, Best Route to a fundamentally driven HF in Londob: IB vs AM?, Best Long-Only Asset Managers for Undergraduates, Citi, Lazard, Jefferies, Fidelity, Morgan Stanley