Path to buyside baller?
I am currently a 1st year at an elite boutique. I would like to preface myself: I completely get it, it's imprudent to be solely motivated/driven by comp; perhaps foolish. Fit, culture, the nature of the work, and prestige are all equally important to comp. HOWEVER, put yourself in the shoes of a young, stressed, and hungry analyst with dreams...inquisitiveness "is strong with this one". In terms of potential future earnings from now until the PM/Partner/MD level, say age 24 to 35-45, how would you rank MF PE, MM HF, and SM HF/Tiger cubs/top activist shops (assuming you stay at one place)? How quickly can you get promoted at each of the three? Of course they all extremely different, but assuming you are successful, average, or below average in each respective option, how do the rankings stack up/change? I do not define success by comp, there's way more to it, but I am curious as to how they stack up. I would be more than happy at a MF PE shop, MM HF, or SM HF, but again I am curious about the different paths to becoming a buyside baller.
I think the more you stay away from using phrases like “buyside baller” the better your chances will be. Also, this has been answered many times over.
With that: [insert 20 caveats] in general the closer you are to generating revenues for your firm the more money you’ll make. You’ll get that opportunity the fastest at a HF vs PE, in general MM will give you that opportunity quicker than SM but the failure rate at MM’s is huge. SM’s tend to have the most desirable seats, but the good ones are extremely difficult to land. Upside there will generally be highest. Of course you have to factor failure rate and expected earnings. HFs (SM and MM) are pretty cutthroat.
My b for using that phrase, thought it would attract attention (the wrong kind...it turns out). Anyways thanks for the advice!
Don’t worry I was just giving you a hard time. I was also young once and I took your language mostly as a joke. If you do have an ego or think very highly of yourself (not confidence but arrogance) it will be difficult at a HF.
You remind me of the other post we just had yesterday with the MFPE kid, HFs arent like banking, being a prestige driven a** doesnt fly. You will soon find that having a golden resume can get you in the door, but you will lose your seat as fast as you got it if you have no investing skill to back it up.
The easy answer is wherever you can generate PnL year after year.
Not sure who you’re referring to, but I appreciate the comments. I’m still in banking, so I obviously don’t have any pro-investing experience. I’ll find out if I’m good or not on the job in a few years. But I’ll tell u this much, it took a lot to get the analyst spot, and I’m ready to put in even more work at the next level. On a side note, do you think it would be better (or even possible) to jump straight to a sizeable SM from banking, as opposed to 2 years in PE?
You claim you work at an "elite" boutique. You refer to yourself in the 3rd person. You say you want to be a "baller". All that and you're probably what, 22?
Please let us know when you IPO. I will be first in line waiting to short you.
My bad, I think I just sh*t my pants.
And fwiw, can’t short IPOs :)
Humility, son. It's great to be hungry. But when you speak with that bravado, you're going to find most people won't be rooting for you.
Lol
lol when you start actually working in this industry ull realize you have to the top .1% of performers to be a "buyside baller"
Huge overgeneralizations here, but here goes:
Successful: MM HF > SM HF > MF PE
Average: SM HF > MF PE / MM HF (equal ish? Not really sure here)
Below Average: MF PE > SM HF >>>>> MM HF
As I said, these are massive generalizations. Some who are successful at SM HF's will far outearn their MM peers, some average MM HFers will be forced out of the industry, etc. From my naive understanding having never worked in PE, MF PE is generally the 'safest' route, while MM HF is generally the most volatile of the three, to both the upside and downside.
I personally don't see anything wrong with the phrase "buyside baller", and I respect the drive and hustle. As long as you never mention that phrase in interviews...
I think the best case scenarios occur disproportionately at the multi manager hedge funds (of course the risk is very high too). I would single out Citadel, as far as I can tell Ken Griffin is the most willing to give juniors crazy amounts of responsibility. There are 25 year old PMs there. One notable alum is Ron Ozer, who launched a (so far successful) fund at the age of 30.
Of course, being a rockstar at pretty much any big hedge fund can yield tremendous upside. Other notable examples are Jimmy Levin at Och Ziff or Chase Coleman at Tiger.
In terms of PE, I think the comp is more tied to experience, your network, and the number of good deals you have under your belt. Much harder to make it big before 35, but it is significantly more stable.
MF PE analysts typically go to great hedge funds. MMs do not offer higher upside than the best SM shops, and the best SMs are lower risk.
Most MF PE analysts can get an offer at a place like Viking or another top fund. Just use LinkedIn to see where MF PE analysts have gone. It’s a good filter for identifying the best hedge funds. $10bn+ single managers offer very compelling risk-adjusted compensation.
There is a high degree of variation between the best hedge funds. Working at Value Act, Darsana, and Viking are quite different in terms of role, compensation, culture, and risk. Speak with older friends or current / former analysts at your MF to learn the differences.
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