AMA: Research Analyst at $1 Billion Hedge Fund

born2trade's picture
Rank: Orangutan | 332

Hey everyone,

I've been a long time user of this site, which was instrumental in getting me to where I am today. If it weren't for the help of everyone on here I certainly would not be in the position I am in today. I've been meaning to do this for a while but I would finally like to give back to the community.

I am happy to answer any question from internship recruiting to PE/HF recruiting, my current role, the macro environment, investment analysis etc. All questions are welcome. I'll try and be as prudent as possible regarding answering questions and my goal is to log in a few times a day as my schedule allows.

Quick Background:

School:

Went to a non-target regional school in the northeast that places 1-2 kids a year in FO IB or S&T roles. We are a big feeder into ops, wealth management and accounting roles. Largely because of this site I went from being completely clueless of anything to do with banking my sophomore year to winning a summer and eventually FT IB offer.

Ibanking:

Landed a full time offer for IB in a well-regarded M&A focused industry group of an upper middle market bank (think Jefferies, RBC, Baird). Also, I was in a regional non-NYC location, which definitely made private equity/hedge fund recruiting a challenge (happy to talk about this). I ended up moving to a hedge fund a few weeks after I hit my 1-year mark and haven't looked back.

Hedge Fund:

Currently I am at a long/short equity focused hedge fund with just over $1 billion in AUM located just outside of NYC (think Greenwich, Westchester). I've been a research/investment analyst covering mainly financial names, though it is not the overall focus of our fund. Thus far, I've been on the job for ~8 months and am really enjoying the space. I've always had a passion for public investing and I can't imagine being in a better environment.

Happy to answer your questions, fire away...

Comments (86)

Feb 2, 2017

Couple quick ones to get the ball rolling:

Are you at a multi-manager or single? What's the work/life situation? (Heard brutal things about the bigger guys)

What was your recruiting process like? Especially being somewhere other than NYC.

Headhunter or not?

Thanks!

Best Response
Feb 2, 2017

I am at a single-manager fund.

The work life situation is surprisingly good. I probably work between 50-60 hours a week on average. I am at a value fund that has a medium/long term holding strategy which helps in the work/life balance department. I think it varies from fund to fund but from what I've heard if you are at the Point 72s of the world you are going to be clocking in 60+ hours a week.

The recruiting process was interesting to say the least. I actually happened to get the job through a Linkedin job posting since the fund had poor experiences with recruiters in the past (worked out for me). I went through 2 phone interviews a few in person with one of those interviews having a model. I utilized the WSO PE interview prep course for all the PE interviews I had and it was a great set of materials that helped me get up to speed on all the behavioral and technical aspects of the interview (including the infamous modeling tests)...(Additionally, I wanted to give a shout out to the new HF interview prep course. I thought it was well constructed and gave a great overview of how to construct investment pitches, win HF interviews, must-know technical knowledge etc. I would recommend it to anyone trying to go from IB to a HF.)

Looking back I would say that not being in NYC dramatically stacks the odds against you, especially if you are looking for your next job to be in that area. Headhunters aren't too open in regards to NYC candidates looking to move to the NYC area. Also, I had 2nd tier IB experience and I've certainly learned that having Goldman, MS or JPM on your resume makes a big difference, especially if you are in a regional location looking to move to NYC. If I had to do it again I would have done everything I could to switch my offer to be in NYC, makes a big difference in the eyes of recruiters as they can actually meet you in person and know you are a quick subway ride from any last minute interviews that come about rather than a long drive/flight.

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Feb 2, 2017

how did you make the jump?

Feb 2, 2017

My post above gives some insight but here was my strategy:

1) Reached out to every recruiter under the sun and built up a good rapport (I can write a book about the pros and cons of recruiters, they are an interesting bunch)
2) Reached out to all the alumni in hedge funds I could find and tried to build a network over time
3) Surprisingly the linkedin job board yielded ~3 HF interviews for me and ~8 PE interviews, though there were a lot of applicants, I could always get past a headhunter (they never liked the fact that I came from a regional office). Going on recruiter sites directly, especially the smaller ones and applying on their job boards helped as well.
4) Studied like crazy and had 3 well developed long ideas and 1 short idea - I also spent a lot of time working on basic 3 statement operating models for interviews and lbo models for PE interviews (PE was my backup industry, though I had low points where I thought I would never get an offer for either a HF or PE fund, its a tough recruiting environment out there)
5) I tailored my responses to the fund, to value funds I gave value ideas and tried to sound as if I spent my childhood reading Benjamin Graham...For more macro funds I gave macro trade ideas and tailored my thought process in interviews to meet their style of thinking

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Feb 2, 2017

Thanks for doing this, always really enjoy these.

Did you know you wanted to do HF when you got into IB?
What made you pick the hedge fund route?

Learn More

814 questions across 165 hedge funds. 10+ Sample Pitches (Short and Long) with Template Files. The WSO Hedge Fund Interview Prep Course has everything you'll ever need to land the most coveted jobs on the buyside. Learn more.

Feb 2, 2017

Since I was a junior in college I pretty much knew that I wanted to work at a HF based on my personal investing experience. I also interned at a wealth management office and was lucky enough to have a boss that was really into investing and he was always trying to pass some knowledge off to me. So I definitely built up a passion for investing over my college years and for right or wrong a HF always appealed to me more than a traditional long only manager.

After spending dozens of hours on this site I thought that S&T and IB were two worthwhile paths and thankfully my first offer was for IB and not S&T (happy to go into more detail as to why I think that is). So yes, I went in to my SA and FT role knowing I wanted to head to the exit door as quickly as possible to get to a HF. Unfortunately, that made my 1 year in IB the longest year of my life (and the most painful)...

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Feb 2, 2017

Thanks for the insight.

Could you please elaborate on why you didn't want S&T. I'm assuming tough exit ops.

Feb 3, 2017

Hey, Romy, any daily/weekly reads that you like? Any fund manager insights that you find particular illuminating?

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Feb 3, 2017

I love reading WSJ, bloomberg, Factset news and there are plenty of daily/weekly newsletters from equity research departments that I read.

I'll have to think about some fund manager insights...there are too many to mention, I'll give more detail later

Feb 6, 2017

Awesome. I'm a big fan of Factset and read a few ER reports most days. Let me know when you put some thought into fund managers... I prefer reading about equities, but am looking for good macro analysis as well.

Feb 3, 2017

Sb'd.

How long was your analyst stint?

Also, what was your deal experience like as an analyst and how did you sharpen up on your deal explanations during the recruiting process?

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Feb 3, 2017

It was just over a year

I only was on 2 M&A deals. One was great it was a pretty sizable sell side of an aerospace company. I learned a lot on this transaction and took the lead on modeling fairly early into my analyst career. The other deal the M&A group ran for the most part, I just helped out when they needed help on non modeling tasks. I sharpened my deal explanations by doing a few things. For example, I memorized every notable financial ratio that someone could ask, had a few pages of prep material highlighting the deal itself and every main/important point and practicing telling the "story" so I didn't sound like a robot reciting memorized lines.

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Feb 3, 2017

Thanks for the reply!

As well, would you mind commenting on how you navigated the internal politics of your group regarding three things 1) analyst support for buy-side recruiting and 2) receiving staffings on your relevant, live deals and 3) (I'm assuming you were a solid performer, at the least) ensuring the perception of your work product and standing in the group was symmetric with your actual work quality?

Background on Above Question:
Perhaps, I'm being cynical b/c of my observations interning in a satellite office of a upper-MM bank. I believe in a perfect world, the people who are engaged, produce quality work, and can grind with a steady, positive attitude should be overweight towards positive outcomes.

However, in the group I interned at this summer, this "meritocracy" didn't seem to hold and seemed more shaded to the political machinations.

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Feb 3, 2017

What was your fund's return in 2016?

You killed the Greece spread goes up, spread goes down, from Wall Street they all play like a freak, Goldman Sachs 'o beat.

Feb 3, 2017

I don't want to give specifics but lets just say it was very good given where the market went...

Feb 3, 2017

Which market? SP500 was up 13.5%, STOXX50 up 8.5% Nikkei was up 8%. Have you beaten any of these?

You killed the Greece spread goes up, spread goes down, from Wall Street they all play like a freak, Goldman Sachs 'o beat.

Feb 3, 2017

Hey mate, thanks for doing an AMA

Firstly: What books do you recommend to read in regards to Investing

Secondly: Was IB really that bad?

Thirdly: Is your fund value or growth orientated?

Finally: In your opinion, what puts L/S strategies apart from other HF strategies?

all the best

Feb 3, 2017

1) Intelligent investor, the most important thing, all the Market Wizards books (I highly highly recommend, focuses more on traders but there are lessons for long term investors as well, especially about risk management), education of a value investor, you can be a stock market genius, reminiscences of a stock market operator, one up on wall street, any of the classic books by Michael Lewis (there are a lot of good lessons buried in the pages)

2) Haha looking back I definitely make it seem worse that it really was. At least for me, I had no interest in M&A/banking (it never captured my interest) so the every workday was a chore...working from 9am - 1am every day isn't fun to begin with, especially if you have no interest in what you are doing. In hindsight I learned a lot and realized invaluable lessons, not just when it comes to on the job skills/knowledge but personally as well. Ibanking definitely showed me that work, your job title and money are nowhere near the most important things in life

3) My fund is value orientated, a typical holding period is 6 months - 5 years

4) Thats a tough question...I'd say you have the best chance of outperformance in any given year vs the S&P when compared to lets say a market neutral or arbitrage fund...that said you have the greatest downside risk as well

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Feb 4, 2017

Good responses, how much of your day is spent modelling in excel?

Feb 3, 2017

Think you'll stick to financials or try to cover another industry in the long-run?

Feb 3, 2017

Thats a great question, honestly I wasn't thrilled when I learned that I was becoming the financials analyst. However, after covering the industry for ~8 months I am really enjoying it. I am basically learning a whole new way of thinking and obtaining a new valuation skill set. Additionally, I cover a lot of small cap names which are largely underflowed and having a good knowledge of analysis regarding financial companies goes a very long way and in my opinion gives you an edge.

That said I would eventually like to try and pick up another coverage area. The financial industry is great but my guess is that I would like to get back to valuing/investing in traditional companies down the road.

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Feb 3, 2017

Hi
I am a Nigerian with 4 years big four experience here in Nigeria. I have my eyes on IB short term and PE long term, to this end I have enrolled for an unpaid internship/ Fin model training wit NYSF starting this june and am slated to resume for my MBA at tippie in Aug. I am very determined but I am not sure of what my chances are after all the efforts and investments. what do you think?

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Feb 3, 2017

What have you spent your four years on, auditing?

Feb 18, 2017

Yea Embiv, I have been doing mostly public sector assurance services for 4 years.

Feb 3, 2017

Congrats on getting that experience in big 4, my guess is that is a competitive industry to break into in Nigeria. I'm not too familiar regarding the IB/PE situation in Nigeria, but I know there are a few firms there (I don't know how competitive it is to break in). Its definitely an uphill battle but as long as you study and put your full weight behind studying/networking/interviewing I would say that you have a good shot at breaking in. Have you ever thought about looking at IB in the USA or Europe?

I have a friend who went from working on a farm in Kenya to obtain a plane ticket to the US and now is an Associate at a major IB. Obviously this is an extreme example, but I was moved to hear about his story and the pure adversity he faced, but in the end he "willed" his way into Ibanking. So with enough effort I am a believer that anything is possible and my guess is having 4 years of big 4 and getting an MBA would give you a good shot at IB and eventually PE.

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Feb 18, 2017

Thanks Romy, Nigerian IB environment is not really structured which is why I am pursuing an MBA (@tippie) starting this august.
But I really appreciate your insight and encouragement.

Feb 3, 2017

@Romy" thanks for the AMA. Can you give us an idea on your research process? How do you go about formulating your thesis for potential investments?

Feb 3, 2017

So far, a decent amount of ideas have come from valuation screens. Generally I limit my screen criteria to come up with ~40 or so names. From there I circle perhaps the 10 "best" ideas given profitability/valuation/my prior knowledge on the name. From there I spend 20-30 min on each name and try to understand each "story". From there I may be down to 2-3 names where I like the valuation/story the best.

After, I'll start doing a deep dive into their financials, investor presentations, research reports etc. Maybe I'll do a quick initial model if I think it is warranted. From there I'll usually set up a call with equity research if they cover the name or I'll try and set up a call with someone on their management team if the name still interests me to answer any questions we may have/get a gauge on management.

Then, I'll continue to do ad hoc analysis based on any unanswered questions in my mind. For the majority of this process (beyond screening) I'm discussing the idea with my PM and we hash out the name. After all this, we generally decide to start an initial position or take a pass. In the end, its up to the PM to make the final decision which is how most funds work (but the analyst's opinion usually falls in line with the PM's).

This process isn't universal for every name we end up investing in but it is fairly reflective. Hope this helps.

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Feb 3, 2017

@Romy" How often do you use equity research in finding new investment opps? If so, will you use equity analysts models? (of course need to take with a grain of salt). Also, I know you mentioned your in a macro environment themed fund...Are you specialized into any Market Cap equities or is it free reigns? (of course excluding nano and microcap). Last thing, can you walk us through a day as a HF analyst at your shop? Thanks!

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Feb 3, 2017

We use research a good amount. I think they tend to get a bad wrap by many but they are a great resource. While I never put a lot of weight on their recommendation to buy/sell, they are a great resource to get familiar with companies we do not know well and they always are taking to management teams and have a pretty good hold on what is going on within the company that you can't get from a 10k. I tend to create my own model vs asking for their model, I would rather go through the thought process myself, plus it is much easier to tweak assumptions in my model vs their model.

I am actually in a L/S equity fund, not a macro fund (though macro themes are big drivers of financial names). That said it is generally free reign though I spent most of my time on simpler small/mid cap names (some of the larger financial names are very complex and the PMs who have been in the business for years have a much better grasp on them than I ever could)

Typical Day:

7:30am - 9am = catch up on emails, global news, holding specific news

9am - 9:30am = sit down with my PM to discuss an idea(s) or existing position(s)

9:30am - 10:30am = have a call or two with equity research or a management team member (usually the CEO/CFO) for a prospective investment / one of our holdings

10:30am -12pm = work on a model or related analysis on a name or 2

12pm - 1:30pm = lunch/quick workout

1:30pm - 5pm = could be any combination of working on existing models/analysis, another sit down with my PM, another call with ER or a management team, idea generation, screening etc.

5pm - 6pm = work on my end of day summary for the PM and send out any emails I didn't get a chance to get around to earlier in the day for setting up calls with ER/management/arranging internal discussions

6pm = head home

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Feb 3, 2017

It's more around recruiting. I'm not close to NYC, equity research background w/ regional firms, non-northeast, non-target school. In trying to decide what pitches to develop, debating between investing time towards absolute value (intrinsic cash flow) and relative value ideas. An absolute value play can take 20-50 hours to develop, which is a lot of time with my current commitments and will take a while. Can knock out relative value ideas in closer to 10. What should I focus on and any tips around getting interviews? Right now my plan is to write up some quality ideas and kick the door down somehwere in NYC. TIA

Feb 3, 2017

Hmmm, from my experience an absolute vs relative idea doesn't matter per say. All the interviewer really cares about is your thought process and how you support your argument. So if you can crush out a great relative value idea in less than half the time, that sounds like a good path to take.

As for making yourself stand out, I had a friend develop a well-done initiating coverage like piece on a stock and sent it to some contacts in the HF industry and to recruiters he was working with. Though I never tried this strategy it certainly helps to illustrate that you have the required financial acumen and can construct a well thought out idea.

Also, I'd say reach out to every headhunter you can and apply to every position that fits your interest on Linkedin (I received a good amount of interviews via Linkedin jobs). Also it doesn't hurt to reach out to alumni within the HF industry and build a network.

Best of luck!

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Feb 5, 2017

Thanks for the response. Probably a stupid question...but where is the best website to find headhunters/recruiters?

Feb 3, 2017

When you said one interview involved a model, what exactly do you mean? What did the interview consist of, i.e. what did you have to do?

Feb 3, 2017

It was a operating/merger model. Basically I had to make assumptions for the future performance of 2 companies (operating model portion). From there I had to merge the two entities, walk through accretion/dilution math going out 3 years and then give support as to what the maximum value was that the acquirer could pay and what value I thought they would end up paying. I had my laptop so they gave me the rest of the day after the interview to send them the model.

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Feb 3, 2017

Would you recommend a current undergraduate go into research? I'm a current sophomore exploring banking roles, and research appeals to me, but I've been reading recently about banks culling their research staff as regulations make 3rd party research more appealing. I just interned at an independent research firm and enjoyed it, but I'd like to start my career at a larger bank.

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Feb 3, 2017

Good question, I think largely depends on what you want to do. It sounds like you really enjoyed your internship, so perhaps ER may be a good path for you. Also, ER will always be an important part of every investment bank. Research helps drive S&T and IB business. While ER departments have shrunk in size, they definitely aren't going away and my guess is they will always employ a good amount of analysts. Also, you can make the hop from ER to a HF or asset manager, I know a lot of individuals who have made this jump (if that interests you).

With that said, if you have any interest in IB or S&T etc., try to get an internship in it to see if it is for you. It is great that you are a sophomore and you still have plenty of time before you really have to decide on an initial path out of college. Also, take advantage of your alumni network and reach out to individuals in ER, IB, S&T, HF, PE etc. This really helped me gain a glimpse of each path, plus its a great way to get the ball rolling before you make "the ask" for summer analyst opportunities. Best of luck!

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Feb 4, 2017

In a world where 95+% of assets are passively managed, do you still think there is room for ER because of the link with investment banking? And how would this effect headcount?

Feb 4, 2017

Are you doing 3-statement models at your HF for your models??

Feb 4, 2017

Essentially yes, though for financials the models revolve around the IS and BS. In a good amount of models I do (especially for banks) I often don't even incorporate a formal CF statement and drive parts of the IS based on loan/securities/deposit growth.

Feb 4, 2017

What is the general range of the asset size of the banks that you look at?

Feb 4, 2017

Usually I am looking at names over $1 billion in assets to $50 billion in assets. We try to stay away from the names around/below $1 billion in assets as trading liquidity in those names are rather low. The last thing you want is to be holding a lightly traded name if things goes south...

Feb 5, 2017

Thanks for doing this, your answers have been very helpful.

A couple of questions:
1) Any (very general) thoughts on comp? How does it compare to banking?
2) What is the career / promotion track like at your fund? At what point can you become a partner?
3) How often do you travel / conduct primary research?
4) What are the pros / cons of joining a smaller vs. larger fund?
5) What are your thoughts on short term (e.g. playing quarters) vs. long term investing (1+ years)? Is one better than the other?

Feb 5, 2017

1) It varies from fund to fund and also year to year based on performance. From what I've seen HF pay for someone around my level can vary +/-20% at a small /medium sized fund vs what you would be making if you stayed in IB on the junior level. However, once you have more responsibility/experience (say the experience level equivalent of a senior associate or VP in banking), you have the potential to make multiple times your all-in pay that you would be receiving in the same year vs if you had stayed in banking. You also have the potential of just making your salary if you/the fund performs poorly and even find yourself without a job.

2) You are an analyst for upwards of ~10 years. After that you have the potential to be promoted to a PM or assistant PM depending on the need. So essentially there is only one step up in the career ladder. From my experience, most funds tend to work this way, or they insert some fancy title for someone in between an analyst and PM role.

3) I usually travel at least once a month. Typically spend 2-3 days on the road per month.

4) Usually, if you join a large shop your pay is going to be higher initially (but it depends), but they will work you harder from what I've been told. I'd say the environment is more similar to banking at a large shop. You are going to be just one of my guess 20+ research analysts and in my opinion have less exposure to the senior PMs/partners. Also from what I've heard you are more apt to be the go to model/excel monkey early on. At a smaller fund like mine you have more exposure to PMs and your work varies more than just initially turning out excel models. I think you can make the same comparisons as you would with PE in terms of being at a mega fund vs MM fund. However, at the end of the day it is really dependent on the fund's culture.

5) It depends on your personality and what fits you the best. It is impossible to say what is better over the other as that answer can cary person to person. At least for me, long-term value investing always appealed to me and I am enjoying my experience thus far. With that said I have made many short term trades in my personal account and I have enjoyed that experience as well. If I had a year where I could take a "break" and do whatever I wanted, I would love to work at a proprietary trading firm just to see what it is like and to see if I was good enough to earn a respectable P/L.

Feb 7, 2017

@Romy" thanks for the AMA. I am from a non-target and currently an analyst in the Commercial RE Finance group at a top 10 US Bank. I have been looking to leverage my CB experience to transition to an S&T or IB and ultimately land on the buy side. I have networked into a potential opportunity at a small distressed RMBS shop (25 employees). The firm purchases whole loans, collateralizes & tranches them, and sells. The size of the firm would give experience to the entire process. Would a few years of this type of experience be attractive to a distressed HF/PE?

Feb 9, 2017

I think it depends...

My guess is that opportunity would give you a good shot at eventually getting in a MBS or structured product focused hedge fund/asset manager. A lot of those funds play in the distressed/sub-prime world so I would have to think that the experience/skill set is directly transferable.

However, it is really hard to go from structured credit to a traditional PE or L/S hedge fund role. If you are dead set on getting into traditional PE/fundamentally driven HF firm than I would think IB is the best path. With that said, there are a lot of great structured credit funds out there if the industry appeals to you.

Feb 7, 2017

Hi Romy,

Thanks very much for doing this. Just a couple of quick questions:

1) Do you think financials have strongfundamental drivers coming into 2017 given rising rate expectations -leading to potentially lower cost/income ratios from higher lending rates, overall lower employee comp?

2) What is your process for assessing positions that are going against you?

3) Is there any disadvantage in being a financials/insurance specialist as opposed to more traditional industrials in the HF space?

Cheers

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Feb 9, 2017

1) Overall, I think financials have a nice tailwind right now from rising rates. However, valuations at the current moment look stretched in my view. However, if Trump is able to lower taxes, roll back regulation and spur the economy along with the Fed raising rates 2-3x per year, than financials can really accelerate earnings and move much higher.

2) Usually it is reassessing the original thesis and pinpointing exactly what is not unfolding as we had originally thought. If we find our original thesis was flawed or there is a real concern over our original thought process, than we will most likely exit the name. Honestly, this is a tough topic and I have a long way to grow in this department, its tough to determine if a poor performer is a temporary in nature or if something meaningful has turned against you.

3) The main disadvantage is that the valuation process is much different vs valuing a traditional industrials name per say. As a result, you can easily be pegged as the financials analyst and have limited mobility if you decide to switch funds. Meanwhile, an industrials analyst could feasibly become a consumer analyst as the valuation process is essentially the same.

Feb 8, 2017

Couple questions,

Generally speaking where are you seeing pockets of value in the bank space given KRX up ~30% post-election?

Am concerned in investing in banks considering high correlation to rate expectations, especially for the more asset sensitive names. How do you deal with this risk / think through it?

For valuation do you run intrinsic DDM models or P/TBV regression relative value analysis? What's your view on adjusting for excess capital?

Thanks!

Feb 9, 2017

In terms of value it largely varies from name to name. For example, there are a lot of under followed small cap names that have not participated in the broader market rally and trade at very reasonable valuations, but a lot of these names most likely deserve to be trading where they are due to their profitability outlook. Its a matter of going through on a case by case basis.

Meanwhile there are a bunch of names that have moved up meaningfully but can accelerate further as the street is overlooking their ability to increase their interest income without help from rising rates or pro bank policies being passed.

In terms of risk, we are always hedged via a short book. But, if you are looking at single names, I would pick names that are only moderately asset sensitive so you still have the upside of higher rates built in but you aren't going to get destroyed if rates end up falling.

We run the occasional DDM and P/TBV regression, though it is definitely not the majority of the modeling we do.

Feb 9, 2017

What path might you recommend for someone from a complete non-target (school doesn't even connect with any banks at our career center, only finance job available that isn't something that doesn't require a degree at all [think insurance door-to-door sales] is PwC) and has a poor GPA (~2.9-3.0)? I already sat for CFA Level 1 and passed but I'm having trouble even getting a first interview when I apply via LinkedIn, Indeed, etc. Should I just be blindly emailing out models I've made to various PMs? That's about where I am at this point since I graduate in two and a half months and haven't gotten any call backs. The stress is real.

Hoping for hedge life.

Feb 9, 2017

Sorry to hear about the struggle. Honestly out of undergrad it is going to be extremely difficult to get in with a hedge fund right away and especially so given the fact that you are coming from a non target with a sub-optimal GPA. Full time finance experience is a must for 99% of hedge funds out there.

First off, I would consider all types of roles from IB to S&T, ER, Asset Management, consulting etc. especially given your GPA and the fact that you went to a non target. Your best bet is going to be eventually jumping from an IB role lets say to a HF years down the road.

Also, I would cold email every alumni that works in any type of FO or even MO role. Since you are coming from a non-target like me, your network is going to be vital to breaking into finance. 100% of my Ibanking/S&T interviews in undergrad came about from this method. Since you already passed CFA I, I would reach out to anyone who works for a traditional long only asset manager (even if its a small shop) as they view the CFA highly.

Finally, I would get your resume in the perfect spot and sharpen your interviewing skills and then try and cold-email any boutique banks/funds in the area even if its for an unpaid internship. Any FO experience will go a long ways and hopefully an internship can turn into a full time position.

Best of luck,

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Feb 9, 2017

Thanks for all the help. Unfortunately, I've only ever found one person on LinkedIn who works in any kind of AM role from my school that isn't T Rowe. Even though Baltimore has a branch of most major banks my school's career center gives no support to those institutions. I think it's because our president is on T Rowe's BoD.

I'll definitely have to shop around though at the more boutique firms. Do you know any off-hand in the DC Baltimore area? How would you recommend opening up to these people? Just tell them, hey I'd like to work for you, I passed CFA Level 1?

Hoping for hedge life.

Feb 18, 2017

Would you recommend applying across all the head hunters for a hedge fund position? Thanks

Feb 23, 2017

Yes, I definitely would if HF is your sole goal, I tried to use every possible headhunter that was worthwhile reaching out to.

Feb 20, 2017

Thanks so much for doing this Romy.

  1. What kind of valuation modeling does your firm use (if this is okay to ask)? More DCF or multiple based?
  2. What percent of analysis is qualitative vs quantitative?
Feb 23, 2017

1) We mainly concentrate on 3-statement models, M&A models and the occasional DCF/dividend discount model.

2) I would say it is 50/50 between quant and qualitative analysis at my firm. We probably spend more time on qualitative aspects vs other value orientated funds.

Feb 24, 2017

If recruiting as a second year analyst, how much do rankings and referrals matter?

What are your thoughts on how to best manage work vs. recruiting? If interviewing, should you be solely focused on studying for interviews (at the potential expense of work performance)?

Feb 26, 2017

My guess is they matter to some degree. I would think if you received a 2/5 on a review that is a red flag for recruiters. Obviously the higher the better but I think a 3/5 is a pre-requisite for recruiters. That said a 5/5 rating as a first year means you were an absolute rock star, so I assume recruiters will really take a serious look at you. I was only a second year analyst for a short while so I don't have any proof to back up these claims, they are only my opinion.

In my view it is possible to balance both without sacrificing work performance. Generally, I would study for 2-3 hours for interviews over the weekend. For most analysts, you are guaranteed to have at least this amount of free time so prepping a few hours over the weekends starting early in your first year as an analyst is a great strategy in my view and will get you ahead of the game (doesn't hurt to start in training when you have a ton of free time). That said once the interviews start it is always a good idea to sacrifice relaxation/fun and use that time for interviewing so as not to interfere with your work performance. Also, I always tried to study when I had down time at work as well (discretely though)!

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Feb 24, 2017

Thanks for doing this.

Tips on how to get involved in the greater NYC area value-HF scene? Networking-wise. Like, any events you'd recommend?

Feb 26, 2017

So I am currently a sophomore at a non-target (liberal arts) school, majoring in Economics. Last summer the only finance experience I landed was interning under a very small Registered Advisory Firm with a Financial Consultant for about a month over the summer after a cold-email, conducting research on TDFs.

From reading forums and articles about breaking in from a non-target school, I come to question myself on whether applying without knowing someone within the company is worth the time (but I'm not sure what to think).

I have no internship lined up for the summer at the moment, which worries me in the long run.

With no direct access to a Finance program, and no experience/knowledge with financial models and valuation (LBO, DCF, etc.), but I am interested in working for a Hedge Fund/Asset Management Firm in the future, what steps should I take in order to make that a reality?

Should I focus on applying to random internship positions related to finance (from Asset Management, corporate finance, etc.) without any technical experience? Cold-email Hedge Fund/PWM/Asset Management boutiques everywhere? Or should I focus on gaining those modeling skills for the future? How much technical knowledge/experience should I really know before applying for current internships/future internships, and when should I be concerned with obtaining those modeling skills for employer interviews? Any advice would be appreciated.

Mar 6, 2017

First off, thanks for this post- I've found it extremely helpful. I also went to a non-target school and am going into middle market IB. I'm looking to take the same path that you did to the HF industry (L/S or global macro in particular), and was wondering if you had any interest in moving abroad to work for a HF? Did you see any opportunity to work at a HF outside of the US?

Thanks.

Mar 11, 2017

At least for me, I never really had an interest in working abroad.

For PE I saw numerous opportunities overseas...But as for working for a HF abroad I may have only ever come across one opportunity. I'm sure if you search hard enough or reach out to international recruiters, you might be able to find an overseas roll. The biggest problem in my mind would be that a HF generally wants people to stay for the long-haul, which could be a problem if you want to go back to the states in the long run. But, if your working for an international hedge fund with global offices, this is much less of a problem.

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Mar 14, 2017

Thanks for the response. I have a couple follow up questions to that if you get a chance. First, where geographically did you see a lot of these international PE opportunities? Also, where were you finding these opportunities; were they through networking or online postings?

Thanks again.

Apr 7, 2017

Hey thanks for doing this. So quick profile here, I'm from a target with a 3.5 GPA and at a top MM IB in NYC looking to either move to L/S Equity or Event Driven/Distressed Debt (I know, it's broad and I'll narrow it down to one strategy for headhunters). What items on the resume help secure interviews with these hedge funds? Is there anything that particularly impresses funds? (Ex. writing for SeekingAlpha, Personal portfolio, etc.)

Dec 1, 2017

Thank you for your initiative ! How about movement from Credit risk division (in TOP 4 IB) to Hedge Funds? I am currently a student (2nd year MBA), offered a position in Credit risk division at one of the IB. I follow domestic and international markets and invest for both short term profits ( in derivatives, growth stocks, earnings season etc) and long term returns. I really love picking stocks which give stellar returns. I also love shorting stocks and the derivative play.

Jan 25, 2018

Hi my name is ron and I'm studying economics and finance at idc Israel.My greatest passion and my bigest dream is to become a hedge fund manager in the future. And there is no doubt that I will try with all my power to succeed. Every day I study and read about investing and it's center of my life. I also work in a financial consulting firm. My question to you is what tip (or 2) you can give to me about career and studies in order to fulfill my dream.

Thanks ahead.
Ron

Feb 14, 2018
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