Is there any disadvantages to taking a hedge fund role as a graduate versus a an IB offer?
Are there any distinct disadvantages of taking a hedge fund graduate programme offer versus a traditional IB offer? Both offers would be for the London office.
Becoming a skilled investor is the goal in the long term but I am curious if anyone thinks I would be missing out on anything of value by not working in IB first?
It really depends on career path you want for the long term. IB will set you up for just about any career in finance, but if you want to be on the buyside, then it's really not necessary to do IB before a hedgefund.
Do you not need the modelling skills you learn in ib? Someone I know in distressed credit mentioned his ib skills come in handy there
Yeah, but still not as important as things like knowing how to use a bloomberg terminal, having a research process, among other things
If you want to be an investor I would go for the HF role
I am leaning in this direction but worried I will miss some key skills that'll better me as an investor
If you want to be on the buyside (and are happy with the strategy), take the HF offer.
I did a brief stint in IB before moving to AM (Equities). There is very little that translates over. Sure, attention to detail, learning to make a beautiful powerpoint, and learning some excel functions are great, but you can build those in HF too. Besides, that is less important than developing a research process, learning how to think (junior bankers just don't do this critical part), and drilling into what matters, all of which you need / will learn in the HF role.
Also, be careful as another solid buyside offer may not come along, so if you have it, grab onto it with both hands and don't let go. Older you get, the harder it is to break in anyway, esp as post-30s.
Thank you. I was thinking along these lines too but did not want to miss out on anything critical.
Hedge funds are all extremely different from one another, to the point of being wholly separate careers.
For example, I do concentrated long-short. Less than 5 new positions per year. So I'm spending my days deeply researching the operations of a given company; the company I'm researching today, I've been learning about for 2 months straight. Other than keeping up-to-date on my few other positions, I've done nothing for 2 months but learn about this new company and how its positioned against customers, suppliers, and competitors.
Compare that to someone at another hedge fund who is doing quant work and tweaking his code to change his automated trading strategy to respond differently to volume spikes.
Completely different jobs with almost nothing in common. Nothing about my job qualifies me for his job, and nothing about his job qualifies him for my job. But we are both hedge fund guys.
On the other hand, IB is IB. Yes there are differences between the firms, but if you've done IB then everyone who values an IB background will see you as someone who has that background.
So when you say IB vs HF, you're giving us half the info. We need to know what kind of hedge fund, and whether its a place where you can learn the skills needed to build a sustainable career. To generalize, the more fundamental the shop the more you're going to need a traditional valuation skill set that is most commonly learned in IB.
Well the fund is a multi-strategy fund that does both quant and has a discretionary fundamental fund. Within the fundamental side there are teams focusing purely on HY credit, L/S equity, distressed credit etc. As a grad I would do rotations across teams of my choosing so it is rather flexible.
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