Chemical Engineering -> MBA -> HF
I was a top student at Berkeley in Chemical Engineering for undergrad and have worked as a Chemical Engineer for Boeing since. I am attending MIT Sloan (MBA with a Finance concentration) in the fall and want to break into HF afterward.
I am doing all of the things that have been suggested to me to prepare for the career hop. Reading publications and literature, learning how to evaluate and pitch a stock, etc.
I'm wondering if you guys have any other advice, specifically on networking, internships I should look for during the school year and the summer, where I should look for jobs/internships to start, and what classes to take. Basically, things that I can do to validate this move that can be shown on paper or a resume.
Is this jump even possible, from ChemE to HF?
Getting Into Hedge Fund After B-School
Getting into Hedge Funds straight out of B-School isn’t impossible but it is improbable. Most require at least some finance-related business first but there are things you can do to make yourself a more appealing candidate. One’s Bachelor’s Major doesn’t usually matter much. If you were able to get into B-School and got good grades there, that is what will determine your success more so than what you studied before.
Very few people break into the Hedge Fund world directly out of school, however. This has nothing to do with their undergrad but rather, is because most hedge funds require people who have a broad understanding and experience in finance already. Many choose to do banking or equity research for a few years first, and then transition to a hedge fund.
Watch this video about getting into a hedge fund from OneWire
You will want to do summer internships through B-School. Make the most of these and use them as an opportunity to network and become known. If you're able to find intern type work in the field during your school year as well, it can only help.
User @sonibubu Hedge Fund - Equity Hedge - Research Analyst offers their insight for getting into a hedge fund right out of school:
I'd say going to a HF will be difficult, but not impossible. But rather than shoot for IB or sell-side ER, try to buy-side AM after B-school. That's what I did, it's super competitive and extremely difficult if you don't have pre-MBA experience, but doable. Just to hedge, yeah interview sell-side ER. I don't know a lot of people who go from post-MBA associate to HF(analyst to HF is common), though I'm sure it's been done before. It's SUPER important that you get an ER (preferably buy-side) internship during your summer and yes work for free during the school year at any buy-side shop that will take you.Edit: Key point is it's always easier to go from buy-side to buy-side (been told this by multiple PMs and analysts at long/short HFs).
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First, congrats on getting into MIT Sloan! It's an awesome school. However, sorry to burst your bubble, but going into HF straight out of b-school without prior experience is not going to happen. I'm assuming you're interested in traditional long-short equity HF? If so, your best bet is to do banking or equity research for a few years and then transition to HF.
mbavsmfin,
Thanks for your reply. I am painfully aware that I am going to need to get some experience. I was thinking about doing some unpaid interships during the school year at some HFs around Cambridge? With the ultimate goal of getting an internship during the summer for an HF in a more formal capacity.
Do you think that I can get enough experience during my two years there to make up for the lack thereof befor Bschool?
I'd say going to a HF will be difficult, but not impossible. But rather than shoot for IB or sell-side ER, try to buy-side AM after B-school. That's what I did, it's super competitive and extremely difficult if you don't have pre-MBA experience, but doable. Just to hedge, yeah interview sell-side ER. I don't know a lot of people who go from post-MBA associate to HF (analyst to HF is common), though I'm sure it's been done before.
It's SUPER important that you get an ER (preferably buy-side) internship during your summer and yes work for free during the school year at any buy-side shop that will take you.
Edit: Key point is it's always easier to go from buy-side to buy-side (been told this by multiple PMs and analysts at long/short HFs).
Congrats on MIT and welcome to WSO. Consider doing IB associate position or ER analyst and then transition to HF. That's the most common route.
Thank you all for the kind words and thoughtful comments. I will begin to search for some internships and opportunities during my schooling that fit into the categories that you all have suggested. I am a quick and eager learner, so I am hoping that I can cultivate skills and network quickly.
I have heard that recruiting for the buy side is less formal than for the sell side. Is this your experience as well? I have no problem getting myself out there, so I guess that will be a good quality in this instance.
you're obviously good with numbers..why not look at prop trading places like optiver/imc or whatever??
Trading is not a great career. You do an MBA precisely so you can do something more interesting such as buyside research. A lot of traders at top prop shops want to do a top MBA so they can make this transition.
Going to a long/short equity hedge fund that does fundamental investing with your background, even with an unpaid internship or two, will be pretty tough without some connections.
However, going to a hedge fund that does quantitative investing or more derivatives focus might be much more in your ballpark.
This is anecdotal so take it as you will, but I know quant-focused engineering grad students at MIT (including ChemE) who have gone straight to HFs without experience other than internships. Your background is a bit different but it certainly seems doable. If you're in Boston, interning at Weiss AM seems to have placed well. For summers, you might want to go elsewhere but they are somewhat unique in offering semester-long internships if you want to get your feet wet. They should be recruiting on campus.
I'm guessing these people went to quant hedge funds, NOT fundamental ones. So yeah, Weiss AM is a hybrid quant/fundamental fund that recruits a lot of harvard and MIT students. You also have large funds such as convexity (fixed income investing), bracebridge (run by andrei shleifer's wife), high vista (multistrategy run by former harvard profs), andrew lo's quant fund (forgot the name), FDO partners, as well as harvard management and MIT endowment. At all these places your quant background will be an asset since they all have quant roles. For long-only mutual funds such as fidelity, wellington, state street, putnam, etc., it will be very tough even though they recruit at Sloan. You will basically be competing with your classmates who had substantive experience in banking, equity research, private equity, and those funds give very few offers to begin with. Long-short equity or special situations hedge funds are even tougher and they pretty much hire on an ad hoc basis.
mbavsmfin, you pass on a lot subjective judgments like they're fact. Buyside research may be more interesting to you than trading; that's just an individual preference, and certainly not a common one.
Trading is still very much a great career. It is one of the most dynamic, difficult, and lucrative roles in all of finance. Furthermore, at a junior level, the titles of "researcher"/"junior trader"/"assistant PM"/"investment associate" entail largely the same job functions; it's just different nomenclature across funds.
OP, you can definitely go straight to a HF from Sloan. There's a tremendous network of Sloanies in HFs. Feel free to PM me, and I can point you to some resources.
Thank you all for your responses. I am happy that I posed this question to people with much more experience than I. I am heartened by the things that you all have suggested and will take your advice, look at the places that you have mentioned and try to prepare myself the best way that I can.
The recurring theme that I keep hearing is that networking for HFs is so crucial, so if I can just bolster my background, using the suggestions above, I think that I will have a decent shot.
Any more advice is always welcome.
Thanks, again
Also,
I have heard that taking the CFA exams are a good way to bolster your background. Is this something that is common in the HF arena? Are there any other certifications that I should be looking into?
Thanks
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