BB Alternative Investments vs BB S&T for HF exit ops

Hi everyone,

I have 2 exploding offers from 2 different BBs, one in the Alternative Investment arm and one in S&T. For the Alternative Investments one, I would be working in one of their direct investments group (not FOF), while for the S&T will be rotational.

Could you please help me choose between these offers? Which offer would give me better exit ops to HF, career/salary progression, entry to business school (if I ever decide to do so), prestige, etc? I appreciate all your answers.

This is my first post, so I'm sorry if I posted this on the wrong subforum.

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Comments (7)

Mar 25, 2012 - 4:41pm

I think the alternative investments position would be more interesting. Aside from the 'prestige/exit opps' things don't you have a natural inclination? I mean presumably you must have at least come across as interested in investing to get the offer and if it was genuine it could be an amazing opportunity.

For me it would be a no brainer.

Mar 25, 2012 - 5:17pm

Thanks for answering! Well, yes, investing has its usual "buy-side" appeal to me, but one thing that I like from S&T is the opportunity to run your own book (ie, have your own PnL), which means your career/salary/bonus progression will be less hierarchical and more performance-based (correct me if I'm wrong).

Aside from that, it seems that WSO members unanimously agree that S&T is the best for HF exit ops (I have been searching/reading through old posts in the past few hours or so).

So, I would like to hear more opinions about this, assuming that I don't have natural inclination... Please keep the comments coming!

Best Response
Mar 25, 2012 - 5:39pm

This is a no-brainer unless you were specifically hired into a trading role in S&T and have a SPECIFIC interest in trading (distinct from investing). If not, alternative investments 100%. I should let you know that the VAST, VAST majority of roles in S&T are sales roles, which are NOT the same as trading, not even close (in terms of what you said about a PnL, etc).

Sales roles, even at the best BB, and I say this without being cavalier, are on a different level from any type of fundamental role (investments, investment banking, etc), and tend to be dead-end positions in terms of trying to transition to the type of role Ben Graham would be proud of (if this is in fact what you're interested in doing). That is not the same as me saying sales roles are bad - it's just that they are a completely different career path and don't let the common thread that 'they are within finance' fool you.

It would be EXTREMELY UNCOMMON to transition to a position at a hedge fund, and impossible to transition to a private equity firm from a junior sales role. A trading role would allow you to get into a hedge fund, but not private equity. An alternative investments role, depending on what you are doing, could get you into a hedge fund, and also, again depending on what you are doing, leave open the door to private equity (but it will be uphill unless your 'alternative investment' is private equity. most PE firms recruit exclusively investment bankers and the odd management consultant).

Sales jobs typically beget other sales jobs, marketing positions, etc. You might get hired by KKR to help coordinate their fundraising prospectus and marketing tour for their latest PE/credit/real estate/etc fund, but you will not be the guy/girl who has anything to do with how that money is spent.

So, in summary, my advice would be to 100% confirm that if you accept S&T you will be doing TRADING and not SALES, and if not, it is a no-brainer to accept alternative investments, based on your stated preference. I would also be interested to understand what specific 'alternative investments' you will be working on, because the implications for a high yield credit vs. private equity vs. real estate vs. distressed illiquid assets may materially affect the advice you are seeking.

Mar 25, 2012 - 6:39pm

"Thanks for answering! Well, yes, investing has its usual "buy-side" appeal to me, but one thing that I like from S&T is the opportunity to run your own book (ie, have your own PnL), which means your career/salary/bonus progression will be less hierarchical and more performance-based (correct me if I'm wrong).

Aside from that, it seems that WSO members unanimously agree that S&T is the best for HF exit ops (I have been searching/reading through old posts in the past few hours or so)."

If it is solely for these two reasons then I think you shouldn't go for S&T. I think the appeal of being 'performance based' on a theoretical level and in practice are very different - your bonus and to a lesser extent progression will largely be determined by market conditions regardless.

I think that if the consensus that S&T is best for HF exit ops it is outdated and comes with significant caveats. Post volcker I would challenge the assertion, maybe there was some truth in it three years ago, my understanding is not so much today. Also it completely depends on the fund; fx trader to global macro maybe, but there are a vast number of funds where the skills just wouldn't be applicable. In long/short fundamental, activists, special situations etc. you will be vastly better off from an investing background than a trading one. In a lot of funds the traders aren't trading in a 'taking positions' sense but in an execution sense, hence these jobs are much less sexy. Certainly there are enough funds out there where an investing background wouldn't hurt you relative to trading that this shouldn't effect your decision.

Also for business school I think the investing (depending on the exact role) give you an edge over S&T.

Finally also I completely agree with the above, your choice sounds like it is between a guaranteed investment role and a 40% shot at being a trader given your post mentions it is a rotational scheme.

If you could provide further details on the strategy that would allow for better advice.

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Mar 26, 2012 - 2:32am

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