Econ major to Macro HF

How possible is it to go from being an Econ major to S&T to a global macro hf, or straight to a macro HF? Would an Econ major not be quantitative enough? Also, are there still some macro HFS that are pure. discretionary? I've always been interested in trading committed, rates, and forex, and have to choose a major, and was planning on majoring in Econ, but am not sure now if I need to major in cs or applied math. Any advice? Thx

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Comments (15)

  • Intern in VC
Mar 29, 2021 - 7:05pm

Macro has become increasingly quantitative (even for discretionary) so I'd say Applied Math (focus on stats) & Econ double major with a minor in CS (focus on data analysis etc) is optimal - tbh might not even need the minor in CS but you need strong programming skills. Straight to HF is possible but will require more work to really stand out from your peers - ideally you're at a top target. Hope this helps.

  • Intern in VC
Mar 30, 2021 - 6:24am

Glad to have someone that works in the industry fielding their opinion. By 'more useful quant skills' what exactly are you referring to?

- Strong knowledge of stats (e.g. probability, estimation, regression, time series, etc) and strong programming skills (e.g. data analysis, prototyping, back-testing, real-time monitoring, etc)?

Cheers!

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Mar 30, 2021 - 8:31am

The issue is that the OP clearly thinks he is going to wow the firm with their macro or trading genius - that in reality takes years to develop even for the most capable traders in an institutional setting. The other issue with OP is that other posts say state school in Econ.  Clearly the wrong job for this person if they don't have the quantitative chops to already want to set themselves apart by taking up a quant major if this is their aspiring career path.

The reality is that you have a useful analytical toolkit or can build things that the more senior people don't want to until you develop and can move up over the course of years.  There is no such thing as a junior macro trader or analyst position practically because things are so scalable and it's not like l/s where someone can know the situation of that company better.

All the things that you mentioned can be useful - programming is also a necessity.  The better you are, the more efficient and useful you'll be.  These things are not the differentiators for the end job if you do really well but are a very necessary step to reach that point and later manage others with the skillset.

  • Intern in HF - Macro
Mar 30, 2021 - 12:47pm

I was supposed to major in econs, but changed to maths+stats instead. Probably one of the best decisions I've ever made. Macro/econs knowledge are certainly not trivial, but it is definitely easier to pick them up on your own compared to maths/stats. My interview was about 80% quanty 20% macro/econs, and I would not have passed the interview if it wasn't for my strong quantitative background.

  • Intern in HF - Macro
Mar 30, 2021 - 1:48pm

I divide "quanty" questions to two broad types - (maybe for a lack of a better word here) computational, and analytical. Computational questions are more like IQ-style closed-form-questions ish, i.e. What is the formula of R-squared, what is Markov Chain, how do you evaluate this summation, market-making problems etc. They somewhat have "right" answers to the questions, and you can almost always find the answers online on Wikipedia. Analytical questions are more about applications of theories in the real world. I.e how would you deal with outliers in regression, how would you determine if implied vol is cheap or expensive, how to hedge slope exposure of the yield curve etc, what suggests regime change etc. These types of questions don't necessarily have the '"right" answers, it is all about the way you approach them. Most of my friends and other candidates prefer computational style questions since it is only a matter of practice, but in my opinion you would want them to ask you analytical questions so you can differentiate yourself from others (I would even suggest to try to maneuver the interview to that direction). 

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