Where should I plan to exit to? (UK top seat?)
Brief summary: Incoming An1 at top BB (GS/JP/MS) top team (TMT/Industrials/M&A) in LONDON. Enjoyed my SA but know I’m definitely looking to move on after 2 years.
My preference would be to end up at L/S HF, how practical is it that I can move there immediately? I don’t see many UK HFs taking on people from my position from LinkedIn, perhaps I’m mistaken, I only checked the top MMs which seem biased towards hiring from PE/ ER, would my bank and group help me here?
Alternatively, if you were in my shoes, how would you play your cards? I’ve been incredibly lucky to get into this position and not sure what I should aim for, I understand headhunters will start to message me around 6 months into the job asking me what I want.
Should I tell them that I only want to interview for HFs, only want MF PE?
Any guidance at all from people who’ve been in my position or are in the position I’d like to get to is greatly appreciated.
Also interested
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In London, there are definitely HF seats open to moves directly out of banking. From the large managers, P72 does a financial professional programme, Citadel hires bankers to cover a specific pod based on their coverage area in banking. Additionally, a number of small LO and L/S hire analyst or research roles directly out of banking, but you will need to keep an eye out for when seats open via headhunters. However, as you correctly point out, the IB > PE > HF route is a more well trodden path.
From my experience, most HH have different teams covering public and private markets, and it shouldn't be an issue to build relationships with both sides and work on them in parallel.
Thank you, this is really helpful. I'll do some more research
From your experience, is this generally only open to GS/JPM/MS or is it open to people from top EBs as well?
Friends have made this move from other BBs (BofA / Citi / Barc) and EBs (Roth / EVR / Laz). Again, this is specifically in London where, although GS / JP / MS still have the strongest names, coming from a good team and having a good deal sheet will open doors nevertheless.
Nobody cares about your group in MMHF. If you come from a decent shop (I.e, even Nomura qualifies) you will have opportunities to interview at Millennium, P72 etc.
Only time your IB cov group can matter is if it’s for niche modelling skills, like FIG. Otherwise nobody hires bankers for sector expertise.
Marshall Wace, Balayasny and of course P72 have dedicated programs for people coming out of banking to train you up. Alternatively you can join a pod directly.
Thank you. What is the timeline for the UK MM processes? After how long in banking is the sweet spot for leaving to HF? The full 2 year analyst programme?
Echo this point on IB -> HF. There was even some guy who left Gleacher shacklock as an analyst to join BAM lol.
If you want MMHF, PE is pretty useless. IB is a standard starting point but unlike PE it’s not the “natural” progression from the gig. You will need to start learning how to cover and pitch stocks, understand what drivers move them in the short term in your own time, since your IB gig won’t teach you it.
The sooner you start working on this, the better, and earlier you can exit. The worst thing you can do is come out of 2/3 years IB and be less adept at creating a stock pitch than my intern.
Thank you. Do you have any recommendations (books/courses/websites/YouTube) on the best approach to learning how to cover and pitch stocks? It seems there's an abundance of training materials online for IB interviews but very little for HF interviews
Original comment was deleted. There’s a lot of resources out there, and more coming out but I probably cannot “plug” them on WSO.
Read through the WSO HF forum and you’ll pick things up slowly, some good quality posts on there. Helped me a ton a few years ago.
Best thing you can do is pick a stock and start modelling out the quarters (revenue build and income statement), read through the transcripts, annual reports, presentations, etc and figure out what’s driving this business? How does the stock react? What are the profit drivers/growth drivers? What is happening QoQ and what is happening to management’s guidance? How does the multiple change as these core drivers are going from +5% to +7%?
Stock pitches should be short, focused on your thesis and catalyst with a good understanding of what the bull/bear debate is and where you could be wrong. That’s the job of an analyst.
MMHF recruiting is not like PE, your bank/group has minimal impact vs your own ability and demonstrable interest in publics. IB is a fine starting point but you will need to do extra work to be interview ready. I would suggest programs like P72 experienced academy and Marshall wace elevate which provide sellsiders training for HF, it’s a materially different skillset, the only real overlap is modelling.
If you can gun for the graduate programs at P/C/M, I’d also try for those
It can sometimes come down to "luck" (i.e., covering the right sector, making the right connections, or talking to the right recruiter) when moving from IB to a top-tier hedge fund. However, it's definitely possible. A friend of mine went from a Tier 2 bulge bracket in London to Bridgewater (in Connecticut), and if that's your end-goal, breaking in early is the best option (as you would, obviously, learn most about the job you want to have by doing that job in the first place).
That said, most people I know at top hedge funds took a more conventional path (GS/MS/JPM to KKR/Apollo to Elliott, or even tier 2 BB to MM PE to Citadel). So don't worry if you don't land that TCI seat immediately after IB, there are plenty of viable paths.
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