Why choose the HF route versus PE route - PE more attractive (?)
I'm going to jump right to it
I have been screening LinkedIn for the past months for people working at the biggest hedge funds in Europe/world - such as Jupiter Asset Management, Point72, Shroeders, Comgest, Millenium etc.
I have noticed that people stay L/S Equity Analysts before becoming a Portfolio Manager for far longer (sometimes up to seven years) that it would take a person to go from Analyst to Vice President at a reputable PE firm. And after all these years the next career step is "Senior Portfolio Manager". Whereas at a PE firm I would probably become a Director or Partner.
In short. To me it seems that people at hedge funds stay at their specific position for years (assuming that they are doing the same tasks for all those years) and even after that their path is not as attractive as at a PE firm. My questions are:
- How is the salary development? Does it increase the same year-over-year for HF and PE people?
- Why would someone consider chosing HF over PE? Given that you seem to be a dog for far longer than you would be at a PE firm.
- As an IB Analyst, am I even incentized to fight over a HF spot or should I go to a PE firm (have an edge over Equity Research Analysts) and climb faster to seniority?
I appreciate all the answers!
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Yeah so you know approximately nothing about the hedge fund world.
Asset managers (i.e long only, are not hedge funds)
at a hedge fund you only have 2 roles usually. Analyst, and portfolio manager. But you can be a senior analyst earning 7 figures (and even 8) if you are running a carve/book.
you take hedge fund because you love markets and think you can be the best at it. If you are you will be paid much more than in PE, and much earlier.
Hf is not about racking up promotions, it’s about putting on ideas that make money and getting paid. Portfolio managers get a % payout on their PnL, they’re not looking for a fancy director title, they’re looking for a 50m payday
To me, the public markets attract me more than the private ones. However, I look to get paid and unfortunately (right now) I associated higher roles with higher wages. But if it is true that you can earn 8-figures even as an Analyst at a HF then who cares about the title?
How was it for you when chosing?
I started at one of the big funds out of school, so didn’t have to choose between PE or HF
Based on the most helpful WSO content, here’s a breakdown of your questions:
Salary Development in HF vs. PE:
Why Choose HF Over PE?:
IB Analyst Perspective – HF vs. PE:
Key Takeaway: The choice between HF and PE depends on your career goals and interests. If you value faster career progression and long-term financial upside, PE might be more attractive. If you’re drawn to public markets, intellectual stimulation, and early responsibility, HF could be the better fit. Ultimately, focus on what excites you and aligns with your strengths.
Sources: Hedge Fund or PE Analysts Program, Why do you go into PE only to go into HF, Why did you choose HF over PE?, From Private Equity Associate to VP in Private Equity, Investment Banking to Private Equity - 6 Things You Should Know
Just interviewed Steve Cohen for one of his first podcasts ever. Might be insightful
Generating Alpha on Spotify
Owen Harper and Amir Fischer
Thanks for spamming multiple forums with this! This is not a marketing platform
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