L/S at Citadel/Millennium vs IBD at GS/MS
Basically in the middle stage processes for one of two HFs listed above for full time. Currently at GS/MS for my summer ibd internship. So far, it’s been a good experience. My group is chill and so are the interns, deal flow is solid, etc.
But what would you take? High level pros and cons of going to a HF FT below. Please add to the list if applicable. Thanks in advance!
Pros:
- Better wlb (huge for me)
- end goal for many (skip private equity and go straight into L/S investing. Are exits into tiger cubs common?)
- more intellectually stimulating
Cons:
- limits finance exits (e.g. private equity)
- job security (huge for me)
- keep on hearing that a long term career in IB/PE will pay more but is this actually true?
I would take L/S HF over IBD GS everyday (but that's just me). That being said, I do want to critize some of your pros/cons, so you can have a more realistic and full picture.
Pros:
- Better wlb (huge for me) [you'd be surprised how little the extra WLB really is. You have to be in the office before markets open, and stay few hours after they have closed (realistically you'd still be pulling 12-14hr days, and on weekends you will be expected to work on your models (as you would have limited time during the weekdays due to calls, conferences, travelling, etc). Additionally, when it is earning season (i.e. 4x per year), it's total choas and you work similar hours to prime IBD at its worst (i.e. 100-120hrs)]
- end goal for many (skip private equity and go straight into L/S investing. Are exits into tiger cubs common?) [agree with the endgoal, although would caveat that IF you don't like it, you silo-ed yourself from a lot of other opportunities due to the niche skillset]
- more intellectually stimulating [totally agree, but there will still be a fair share of admin and numb tedious tasks]
Cons:
- limits finance exits (e.g. private equity) true
- job security (huge for me) [this is the big con. If you work for a PM, at a pod shop, that has a few bad quarters and he is let go, his entire team will be let go as well]
- keep on hearing that a long term career in IB/PE will pay more but is this actually true? [I would disagree with the long term career finances in IBD, but it's true that on average in PE you will be paid more. However, it all comes back to risk/reward. The upside in HFs far outweighs the upside in PE, but that comes with the minimal level of job security and being paid close to nothing in bad years]
How does the median outcome in HF outperform IBD? If you're not bad in IBD you'll make VP and if you're decent you'll make director. What's the equivalent level in HF and how difficult is it to get there and stay there?
Hours are pod dependent but most people do like 60 hours / week. The poster above is pitching the worst case
Source: I work in a pod
If you wanted to exit to a pod shop like MLP or Cit from IBD, there would be 0 need to go to PE first. Investing style is completely different.
People use PE to exit to single manager HFs or yes, Tiger cubs.
why is this the case? Why is it that people can't go from IB to top SM's/tiger cubs?
Because the tiger cubs say no.
I mean it's not a universal rule but it's fairly common. Just look at employees of any cub.
I’d take GS IB over a pod if you’re early in your career.
The pod life will always be there, these seats are a dime a dozen & they’re always hiring.
The training in IB will enable you to exit to various finance verticals & give you something to fall back on if your next career move doesn’t work out.
Going to a pod so junior & having it not work out will make future moves more complicated.
If you do want to go the MM route, do some deep diligence on the PM. If he’s been around a while it’s a different career risk vs a newly hired PM.
Agree with this. Not trying to shit on pods, but it’s very different to land a seat at a pod shop vs a tiger cub (which is the post-PE exit you typically read about on here). Pods have ridiculous turnover meaning seats are always opening up - it’s not “easy” by any means to land one, but know people from some non-top banks who aren’t the most stellar candidate and land jobs at top pod shops after IB. The door is very much open to a pod shop post IB from a top bank, whereas IB/PE/etc mostly hard to get to from a pod shop
As someone who started on the buy side (ignore title) out of school, you want to take the Gs/MS IB seat if you can handle that grind for 2y. You need the golden platform to jump off of, like the poster above commented. For me and many others, your path from buy side day 1 is meandering down the very unstructured path of investing roles, which is sick if that’s what you live and breath for, but you need to be sure. Like if you are some fucking savant with markets and have a deep desire to be the next Stevie cohen, the choice is obviously citadel. But if you are just a normal guy who is positioned well coming out of schooo with a lot of options, I would lean on the IB.
Interning at the other MM rn but I’ll share some thoughts.
1) millenniums grad program sucks, don’t consider doing it if this is your offer.
2) You’re not going to have job security or exit into a tiger cub from CAP.
You don’t have the offer yet so this isn’t really a debate to be honest. You should apply to these funds if you want to work at these funds, it’s that simple.
To caveat what the people above are saying, MM seats will be open for a while but at least at the shop I’m interning at (and the location) the top PMs prefer to hire people that went through the grad scheme.
Your first job and way of approaching the market will be tailored to what PMs are actually doing vs stumbling into a pod seat after x years doing PE or IBD where you might be a good fit or might not.
just from my experiences
Citadel Associate Programme. Basically their grad scheme
Could you provide from color on Citadel's CAP? IDK how long it's been around and what exit opps look like, but how good is this program/seat really.
Not entirely sure, as I said I’m only really experienced on the other big MM.
it’s citadel, it’s top hedge fund so getting in early is obviously a big deal…but only if this is what you want to do. The people that excel in these roles aren’t really thinking about the MM Vs SM debate, they just want to work at a hedge fund/in public markets.
Off the back of that, I don’t think people really consider exit opps. Citadel is the exit opp so it’s about extending your longevity there as much as possible. Exits will be to other hedge funds (not top tiger cubs or highly specialised strats).
Why do you say Millennium’s grad program isn’t good? Surely 1 year of sell side training wouldn’t be bad?
Sellside training is not buyside lol. 1 year definitely isn’t enough and doesn’t teach you how to do the job. It’s just a relevant training ground but doesn’t prepare you for MLP. The low placement of the program itself speaks for itself. P72 & citadel invest in creating programs specially designed to get you to be able to do the job
Have a few opinions and hope to provide another POV.
Citadel over IB, no question. Even if it is a different track, much more prestigious and you will have better exit options even if you change tracks. IB analysts are a dime a dozen. Plenty of ways to change back into PE especially at mid-level. Lots of corporate carve-out opportunities right now you can dig into as L/S analyst then pitch as both dealflow and justification for making a switch back to PE.
Don't make any decision on whether HF or PE track "pays more". If you do well in either track you'll be rolling in bank, and the variability in outcomes is broad enough that being good at what you do is really what determines outcomes. Nobody gets a $5M bonus check/carry check and complains it would have been $6M in PE or that ordinary income tax rates are higher than capital gains. At that point, whether you add a zero or two to that number depends solely on your own ability and not "track".
How common are those salaries? Like what % of IB analysts get there
.
I don’t know how much L/S pay but new grad quant at Citadel are at 500k+
How long does it take to get to 800k in IBD?At Citadel you might also get the opp to invest in the fund which can be a lot of good money
that's insane if true
Ofc it’s true. Do you think the top students at Hardvard and MIT are joining trading firms because they like it that much? They just apply to that instead of IB because the pay can be massive at a early age
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