Any questions on life in finance in Hong Kong? Q&A

monkey_brah:

What's comp like between comparable positions in the U.S. vs. HK? (IB, PE, or just generally) What are hours like between comparable positions? Can strong skills get you over the language 'requirement' you alluded to? Will they give you time to ramp up?

Comp - I think IBD is fairly standard globally, but PE is definitely much less comp in Asia than in USA. Most PE shops in Asia, carry is only for MDs. In USA I think carry gets paid even to VPs. Taxes are less in HK - just 15% on salary and no capital gains tax.

Hours - generally similarly tough in Asia as in USA. No difference.

No way anyone gives you time to 'ramp up' language skills. First of all, learning an Asian language to business fluency takes years of full-time study. And even then you won't know technical jargon and idioms. Employers want native-fluent workers who come from that culture. It's not enough to - say- speak Chinese. You have to BE CHINESE. So if you're going to compete, you either have to come in with great technical skills + work experience + some language ability, or go to a role that doesn't require language skills at all. Otherwise a local will eat your lunch every single time.

nuts:

Question about developing language skills - what level were you at after your 6 months of study in China, and how long did it take you to get fully up to speed?

What's the best way to go from having proficiency in conversational Chinese to having a strong ability in business and professional Chinese? Can you suggest any resources/ things you did that helped you?

Depends on many factors, including genuine interest, natural ability, and how balls-to-the-wall you are in terms of being willing to study characters and vocab and just crush your brain to learn it.
I hired tutors and that helped.
Some language exchange helped too - but it depended on the counterparty.
In 6 months full-time, you can probably call yourself conversational, but no where near business level. You'll be able to order food, go shopping and hopefully give directions to a taxi driver. It will take 1-2 years to get to business level, and that means you hit the books constantly and cramming like you've got a gun to the head.

shinobi:

What type of industries see the most deal activity in China?

I understand that having oral fluency in Mandarin is important, but what about written work? Is your written work (e.g. looking over financial statements, drafting term sheets, etc.) predominantly in English or Mandarin?

Re language - depends. I'm not terribly literate, and it definitely hurts my competitiveness. But for some jobs verbal fluency is enough. Can't do IBD though, or most PE.

Industries - healthcare, tech, industrials.

BubbaBanker:

earthwalker7:

weather is mild

Isn't it super humid?

Only for a short time in the year. Most of the time, it's quite nice. Unlike Singapore, where it's humid all the time, and then rains mid-day. And better than Shanghai where it's super humid all summer, and humid and wet and freezing in winter. And better than Beijing, where it's dry and hot or dry and cold. HK is pretty much as good as it gets in Asia, and I find it quite nice even tho I grew up in Southern California.

radmad:

How much importance do the firms in Hong Kong place on where you went to school?

It matters for high finance, as it does anywhere. But what matters more is language and cultural functionality and finance skillset.

FinancelsWacc:

1. Are you white or are you Asian, grew up in the states and then went back?

2. Would you consider yourself an extreme outlier? (The way you describe the language / Asian barrier it seems that if you in fact are white then you'd be an even greater outlier). If you're Asian perhaps your case isn't as rare and more applicable to other Asian-American's (or generally just Asians living anywhere that isn't China)

3. How apparent is the whole "State run capitalism" concept in PE / does it cause many fundamental work differences compared to PE in the USA?

1. I'm white and grew up in USA. So I face some cultural non-acceptance that a Chinese wouldn't face. (the irony, right? Unfair privilege in USA, but perhaps fair challenges in Asia)
2. Funny enough, the firm I worked at was China's leading SOE-privatization specialist. But the lack of acceptance of my non-Chinese self would have been the case even if we had been more private company focused. In fact, we started doing more private co. deals and the issue persisted. I think most PE funds in China don't touch SOEs anyway, so my own situation of non-acceptance as a foreigner would have been the case at any firm.

I'm also questioning your view of "state run capitalism" China's pretty capitalist. It's authoritarian capitalism with selected state intervention, but certainly pretty capitalist and free-for-all in nature

theyoungmarcus:

How do you suggest a HK ABC break into HK? I have proficient level cantonese (basic reading + writing) and currently doing a masters at Oxbridge and undergrad at a well regarded state school (especially in HK). Any hope for me in asset management / equity research?

Take as many language classes as you can and get tutoring while you're in school. That way when it comes time to interview, you hit the ground running. Try to get internships in HK or China. Do thesis work or other classwork that pertains to China and Asian economics/business. Come out here during spring break and try to crash the 'days on the job' where MBAs get to meet bankers. Tag along to other schools' sessions.

etx:

Thanks for doing this. 1. Is it possible to get a working visa without being sponsored? 2. Whats the likelihood of transitioning to IBD or a bigger PE fund if I started as a grad at a smaller shop? 3. Whats the pre-tax comp actually like

1. If you're from most developed world countries, you can stay here for 90 days without a visa, and then renew the visa by going across a border - usually to Macau, which does not need a visa either, but you could also go into China if you prefer and if you have a Chinese visa.

2. Moving to bigger shops is always harder if you're starting from a smaller or lesser-known shop.

3. comp is ok. I don't think it's ever as good as US, but yes, taxes are lower so it's ok I guess.

Quietus:

Hey, thanks for doing this AMA! Couple of questions from my end:

1. How do Hong Kong high finance firms view candidates from other parts of Asia (think Singapore, Malaysia, Philippines, Thailand)? Do these firms prefer to hire from the US/Europe?

2. On learning Mandarin, how long on average do you think it'd take to get to a conversational level? Personal goal of mine is to be able to converse a bit (reading, writing, and a business level vocabulary not necessary).

1. Asian candidates are preferred over US/EU candidates overall, as they are seen as having greater linguistic and cultural relevance.

2. 6 months of full time study to beginner level, 1 year to conversational

Hi Wolf, First things first - you need to get in to IBD, before you start planning more complex moves. I hate to bear tough news, but if you're from a second string school, you're not really on-target. So you'll have to proactively reach out to get into US IBD. You'll need to network like hell, reach out to alumni, and do 'days on the job' in NYC to break in to IBD. None of the schools you mentioned are target schools for IBD, but that doesn't mean you cannot do it - just means you'll have to work harder and out-play the competition. You should also know your finance down cold - start preparing now. If you can, grab an academic-year internship so that you can prove that you have the goods to get. Now there's no law saying you need to, or that you cannot just move to Asia after you graduate. In fact, as a non-US-citizen (my assumption), and a person from a rapidly growing Asian economy, you may actually find it easier to get into IBD in Hong Kong. In order to do so, you will want to use winter and spring breaks in Hong Kong hustling up a job. Once you're actually here on the ground, as an intern or fresh grad, it's easier to network around and find a role. As for the move from IBD to hedge funds - that's not so easy either. Usually one starts in equity research or trading and then move to HF, or if you're luck you might find a role as a junior PM right out of b-school and then moves up in the HF. The way to approach that process is totally different from IBD recruiting. However there's always an exception to the rule. One of my friends did do a summer in IBD, then made the move to HF, but his way in was to work as a student-PM in our MBA's public equity investment fund while on campus, and then he had a book of trades to show hedge funds in Asia when he came out right after b-school. Sounds like you have a lot of work ahead of you. Good luck! -M

Good thing you speak Canto then. If you had no language skills, even S&T would be hard to get. For S&T the challenge is it's a shrinking field. My buddy was hired at a BB in a 26 person team 10 years ago, and he's now one of 4 guys left. 4 guys on the whole desk, and they are looking to cut. So you're joining an industry sub-sector where groups have gone thru 85% headcount reductions and will likely cut more. You're voluntarily joining a sub-sector that is being made near-irrelevant by technology and that's not a trend that's going to get better. An algorithm will be able to do your job, and even if you're amazing at sales, then you still now have to upload your recommendations to a centralized system that the buy-siders pick ideas from, and hold you accountable for your recommendations. My buddy advises 100% of the people who information-interview with him NOT to go into S&T. Because we're in 2018 not 1988.

That said, if you still want, then hustle your way into the desks by cold calling and cold-emailing them investment recommendations, with details and nuance and hope you score a hit.

I have a similar question to fathippo.

Are there any recruiters in HK that you would recommend for IB/PE/VC/HF recruiting?

If you have any tips from your experience moving to HK, that would be very much appreciated as well.

Thanks

fathippo:

Want to pick your brain about people with a background in finance transitioning to HK. Grew up in HK but did school in Canada and currently working in ER in Canada at a midmarket bank.

Considering moving to HK for the next step of my career. How hard would it be to secure a job before moving over or is it better to just quit my job, relocate and then find a job? What's the job market like for people with NA finance experience and fluent in cantonese / conversational in mandarin? Hoping to ideally transition to a BB.

You mentioned that you are trying to transition back to US but struggling, so would it be better to just avoid HK and stay put in Canada / try to move to the US instead?

On whether to stay in NA vs moving to Asia - it's hard to advise, because it's a personal life decision. I personally feel NA to be a boring f-ing place (outside of NYC) to live, and Asia is super exciting. But comp wise you'll almost certainly do better in NA.

You've got Cantonese so that's helpful, but with only middling levels of Mandarin you're going to be less desirable than mainland Chinese candidates, and will always be at a disadvantage. And that trend is accelerating not diminishing. All things being equal, an employer is much more interested in the Mandarin native than you.

For you, I'd try to apply long distance, line up some informational interviews from your school alumni, and then invest 2 weeks here trying to meet people in person. That will give you a better read.

I would not recommend someone quit a solid gig to move to Asia. Especially not at an early point in your career. BUT if you happen to be laid off, or somehow have a lot of time, you could come over here and network and see how you get on.

clubbing, bars, easy to meet up (finance workload permitting) with friends for lunches and dinners given how compact the city is. Hiking and beaches galore. Summer time cruises and beach parties on chartered yachts, which are quite affordable even on a junior salary. Weekend getaway to Philippines, Vietnam, China, Japan, Korea. It's awesome if you love travel and different Asian cultures. It's a VERY active life out here if you seize it

DeepLearning:

Know many hedge fund guys out there? Lot of the bigger hedge funds have offices in Hong Kong that I could have a shot of getting into. Seems like it would be a cool experience to live in HK for a couple years. Not sure if it's a good idea career wise though.

I know some HFs. i'm not in that space though. Seems like HFs have a more mix of foreigners, as opposed to locals.

calzyf16:

how would you compare the BBs in HK (specifically Goldman, MS, JPM), in terms of salary and comp, culture both in and out of the workplace, dealflow, strengths in certain products/industries? Thanks a million for doing this AMA

Typically HK pays less than US, but has lower taxes. Beyond that, it's too group specific to draw broad conclusions. There's plenty of well-paid ibankers in HK, as well as Wall Street. Culture - too group specific as well. Overall, Asian banking is more genteel than in USA. You can't be a total roaring, stapler-throwing, abusive psychopath in HK and not get HR giving you a call and requesting you tone it down. But that's not to say everyone in banking in HK is nice, it just means they can't openly act out at much.

allinbanking:

How does PE recruiting work in HK?

I have a friend who worked three years at a global investment bank (with huge presence in HK) to lateral to another investment bank because he told me there aren’t many PE firms and the 2 year IB 2 year PE path isn’t that common there.

Headhunters, online submissions from efinancialcareers.com.hk, or networking with friends who are in PE. There's no schedule, and the process a much less structured than in US.

allinbanking:

I have a friend who worked three years at a global investment bank (with huge presence in HK) to lateral to another investment bank because he told me there aren’t many PE firms and the 2 year IB 2 year PE path isn’t that common there.

Well there are a fair few PE firms focused on China, or focused regionally Pan-Asia. I don't think your friend is accurate. That said, the process is definitely less structured than in USA. One has to hustle.

coorslight3pm:

Thanks for the AMA! Just a question about the timing of lateraling back. If my goal is eventually to work in HK or mainland China in buyside, and I'm about to start my 2 year IB stint with a top BB, should I: 1) finish 2 year and internally transfer to BB's HK office and do IB associate, then hopefully recruit out to buyside 2) finish 2 year and move to PE in US, then come back after 1 or 2 years into PE stint 3) recruit for buyside opportunities in HK directly when doing analyst stint through friends or contacts

All 3 are fine choices. 1- if an internal transfer is possible, this buys you a soft cushiony landing and time to interview around in HK 2- if you can land a US PE gig, that's a great way of launching a PE career 3- always good to have your feelers out and try to find some good roles.

So - do all 3.

OMG, this again? Sorry, but, I'm going to need to make a posting about "stop obsessing about windows to jump to the buyside." [and subsequently I did make such a posting]

Everyone always has some "rule" they'be heard of. Let me list a few gems:

"You can only leave IB and jump after your second analyst year." "You have to leave before you make VP." "You have to go to b-school." "You can't recruit right after b-school." "You can't come from consulting." "You can't jump when you're MD." "It's a regular cycle, and I'm so off-cycle that I'm screwed." "You can only leave IB and go to PE on Good Friday on a leap year."

I'm going to go postal. Where's my M16? Who spreads these stories?

I've seen people come in as analysts, from family offices with zero IBD experience. I've seen people transfer in at every level - analyst, associate, VP, director, MD/partners who bought into the franchise. I've seen consultants come aboard, i-bankers, a couple of lawyers, and couple of folks from TAS at bg-4s.

One guy, who started as analyst but is now MD at the region's top fund, came in from a corporate banking trainee program from S*ttygroup (ok I'll grant that's a truly rare move but still, proves a point).

I can't take the WSO people fretting, scaring each other, and drumming up bullsh*t rumors about the PE industry.

Here's what you need to know. It takes solid finance knowledge, personal relationships, some domain expertise, and friends in the industry to get you in. That's why I think W/S/H keep getting people over to PE - because alumni hire alumni and their buddies.

But all these nutty rules people recite like gospel, and then godforbid plan their motherf-cking careers around..... are you kidding me? Stay in ibanking, learn your sh*t, learn to model in your sleep, pick up your industry and know it cold, build your rolodex, then call up your buddy from your analyst class who is working at Firm XYZ to hire your ass and refer you around.

Jesus, "I can't make a move from IB to PE because it's not a full moon on a leap year."

The door is always open for a good candidate who knows his sh*t, has hustle, chutzpah, and a friend who can refer him.

B-school is awesome BTW. Why dont' you want to go? The opportunity cost and money? If so, go to INSEAD and cut it to a year, or do the San Fran weekend programs of Berkeley or Wharton. MBA gives you street cred you don't deserve but should gladly accept. And it will give you 2 year or amazing memories. If you can't / won't afford it, that's cool.

But again, you don't HAVE to have an MBA to get a PE job, esp if you're already in IBD. MBAs are for people like me who had little luck breaking into finance after undergrad and needed a second bite at the apple.

CrimsonBulldogTiger:

buyside is something that's on everyone's minds

CrimsonBulldogTiger:

...

For real? Seriously, it shouldn't be something you obsess about.
Stop it.

CrimsonBulldogTiger:

... (and given I'm already an associate I feel like my time is running out)

It's not. See my rant above, and learn to be patient FFS.

CrimsonBulldogTiger:

... by the fact that a lot of buyside stints in Asia are "2 and out" - and requires you to get an MBA

Who makes this shit up? Seriously, I've never even heard of this, much less experienced it. When you little scamps get together, you're worse than a sewing circle.

CrimsonBulldogTiger:

In addition, there are also worries of progression where you can't progress unless your Principal leaves etc. (heard in many cases you jump from a large fund to a mid-market one and then to a smaller one for progression)

dude, waiting for people to leave is true in EVERY job. I can't make senior barista until Chelsea leaves. Better push her down a flight of stairs or put roofies in her pumpkin spice Halloween holiday special latte.

CrimsonBulldogTiger:

From that perspective, buyside really doesn't look that appealing (especially given that I have no desire to get an MBA)

is the scene in Singapore and HK any different? (I would assume not)

Singapore and HK are VERY different. Sing is SE Asia focused, and so it helps if you speak a Bahasa, or maybe Thai/Viet. But really, it's Bahasa. Some gwai-los do ok.
Actually there's a larger number of whities over in Sing PE than there are in HK these days.

in HK it's all Mandarin.
If you aren't mainland Chinese, you're out of luck. HK has totally localized. Even HK people (Honkies!) aren't wanted.

You need to be dyed-in-the-wool mainland Chinese, who grew up in split pants (and if you don't know what split pants are, you're already dinged from working in HK PE. )

Ultimately, are you mainland Chinese? Are you Korean? Or are you SE Asian? That determines where you should work (or at least, where it's easier for you to find work as an attractive candidate).

Cash Equivalent:

I am an undergrad at a non-target US school but I have 8 months of middle market M&A experience and bilingual proficiency in Mandarin from having lived in Taiwan for 2 years. Are there any firms I should look into aside from BB? Any other thoughts about a US kid breaking into HK IBD/PE scene?

It should be possible. HK is very open to hires from people who aren't from HK. In fact, the whole island is a mix of people who are from elsewhere, so being from the US won't hurt your chances. My only concern is whether or not you're Chinese. My experience as a Chinese-speaking non-Chinese is that it's really difficult out here as a non-Chinese to get on to IBD or PE deals in mainland China. So, while I don't think being from the US is a hinderance, I'm not sure how easy it will be if you're not actually Chinese, but the fluency in Chinese certainly is helpful.

RosewoodGrand:

Given the amount of wealth in HK. Are there a lot of family offices that do direct investments? Are family offices a common option for people breaking into buyside?

Yes, it can be a good way to break into the buy side. And in HK there's a lot of family offices, and they mostly do private deals. There's a lot of variance in the family offices tho, so choose carefully. A lot of them are just like in-house pets to sniff at deals that come in. It's better to get into a fund if you can, but I do know that's difficult to do.

byan1232:

Thanks for all the helpful information, a question from my end: Just finished IB training at a BB as a 2nd year analyst (transferred from another group before). If I am willing to start as a 1st year analyst in HK, how are my chances of getting an IBD job? I am fluent in spoken Mandarin / intermediate in written/reading. Moving for family reasons.

Sounds like a pretty decent background. You've got a shot. I don't know how easy or difficult it might be, but talk to the HH and check efinancialcareers and see. Are you Chinese though? Because my experience as a Chinese-speaking non-Chinese is that it's really difficult out here.