How fast ro be for PE modeling tests and how difficult can they get?
Excuse the sloppy writing, pretty tired rn.
Just feel like I'm slow as I'm practicing for PE recruiting. How fast at modeling should I be when I know I'm ready? Should I be completing all the Peak-F tests in half the time?
What are the most difficult modeling tests you've seen? Do you think a person who can confidently complete the L5 modeling test are good for UMM/MF recruiting modeling-wise?
Ah, the classic race against the clock in PE modeling tests! Let's swing from the trees and dive right into it:
Speed in PE Modeling Tests: The key here isn't just speed, but accuracy combined with efficiency. You should aim to complete the tests accurately within the allotted time. If you're consistently finishing the Peak-F tests in half the time given, that's a strong indicator that you're more than ready. However, don't just focus on speed – ensure your work is error-free and your assumptions are logical.
Difficulty of Modeling Tests: The difficulty can vary widely. Some tests might require you to build a model from scratch, while others could involve making sense of a complex, partially built model. The most challenging tests will push your understanding of financial concepts to the limit and will test your ability to work under pressure.
Preparation for UMM/MF Recruiting: If you can confidently complete an L5 modeling test, you're likely in good shape for upper-middle-market (UMM) and mega-fund (MF) recruiting, modeling-wise. These tests are designed to be rigorous and completing them with confidence suggests you have a solid grasp of the necessary skills.
Remember, practice makes perfect. Keep honing your skills, and you'll be swinging through those modeling tests like a pro. And don't forget to get some rest – even the best of us need to recharge our batteries!
Sources: Modeling as a professional vs. as a student, Modeling Test - Quarterly, Career Advice - Bridging the Gap of Good to Great, Modeling at work vs modeling tests, Best HF Modeling / Case Study Prep
Hardest I have seen is, from a blank sheet and 10Ks given, historical 3 financials statements + projections in 3 hours with assumed new cap stack at the acquisition date. Ideally you had quick business overview / investment thesis (yes/no/why) + returns output.
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