Where to go from here? Thought I had my dream job but AM seems an industry in decline
I landed my dream role 4 years ago (Long-only AM at a large fund) after doing sell-side equity research post-MBA. While initially everything seemed great, I have become disillusioned with outflows (money continues to move to passive despite strong fund performance), politics (performance seems to matter a lot less than I thought) and compensation appears low relative to the work we have to do (hours not very different from sell-side research with some work on weekends. Hours and stress is better than L/S but not nearly as much as I thought).
What appeared to me as a long term stable career with good compensation turns out to be an industry in decline where comp is coming down (even some funds-of-funds gigs pay far more with lot less stress & much less hours).
I'm now strategizing about what to do next? I always wanted to do LO asset management so I'm very confused about what to do next. Looking for advice
Based on the most helpful WSO content, your situation is not uncommon, and many professionals in the asset management (AM) space have expressed similar concerns about the industry's trajectory. Here are some key considerations and potential next steps:
Assess Your Long-Term Goals: Reflect on what you value most in your career—stability, compensation, work-life balance, or passion for investing. If LO AM was your dream, consider whether it's the industry itself or your current firm that's causing dissatisfaction.
Explore Adjacent Opportunities:
Consider the Passive Investing Trend: The shift to passive investing is a structural change in the industry. If you're committed to staying in AM, targeting firms with niche strategies or strong alpha generation could be a better fit.
Network Strategically: Leverage your MBA alumni network, former colleagues, and industry contacts to explore roles that align with your skills and interests. Informational interviews can provide insights into other industries or firms.
Evaluate Compensation vs. Lifestyle: If compensation is a significant concern, roles in private markets, hedge funds, or even funds-of-funds (as you mentioned) might offer better pay with less stress.
Upskill or Pivot: If you're considering a career pivot, acquiring new skills (e.g., data analytics, coding for quant roles) or certifications (e.g., CFA, CAIA) could open doors to new opportunities.
Stay or Transition?: If you're still passionate about investing, consider whether a move to a smaller, more entrepreneurial AM firm or a boutique could reignite your enthusiasm. Alternatively, if the industry itself feels misaligned with your goals, a broader career shift might be worth exploring.
Ultimately, the decision depends on your priorities and willingness to adapt to the evolving landscape. If you're still unsure, taking time to reflect or even consulting a career coach could help clarify your next steps.
Sources: The Efficient Career Hypothesis: Almost All Jobs Are Priced In, Fork in the road: Career path in Asset Management, https://www.wallstreetoasis.com/forum/asset-management/will-asset-management-industry-just-wither-away?customgpt=1, Will asset management industry just wither away?, https://www.wallstreetoasis.com/forum/private-equity/where-is-the-industry-going-for-young-professionals?customgpt=1
What is your directional comp and AUM scale of the firm? For truly scaled AM, you should have visibility to stable and rising comp in a relatively stress-free environment, no?
I thought that before taking this job as well but no. Comp is $300k for AUM at my level (8-10 yrs of experience) at our fund of $5B+ (per head we have almost $700M AUM so we are a lean team) but the senior guys are very stingy.
That is tough, especially if you're in VHCOL...
To what extent do you have visibility to higher comp over time or in years where your picks or the fund outperforms?
Overall, I wouldn't write off the entire AM industry just yet as other seats can be more generous
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