I'm currently a junior PM at an EM hedge fund that isn't having the best year. I have an offer from a sellside trading desk to run credit portfolio trading. I've been in a quant macro career path but I don't think EM is going to do great in this environment so I'm worried about job security. The new gig is a career shift but it's a pay bump and a bonus guarantee. Two questions for anyone who has a view: (1) how interesting is running credit portfolio trading going to be vs buyside EM? (2) how worried would you be about an experienced hire sellside offer getting pulled during your noncompete of 3-6 months?
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Unfortunately I don’t know how interesting that position would be. I would say a few things:
1) it is interesting that the sellside offer is actually a bump. If that is the case you are probably underpaid in your role. HFs generally pay a premium (partially due to the structure of the firm).
2) across almost all industries the job market is pretty rough right now. I am actually a bit surprised that sellside is hiring, mostly because of the uncertainty (and they have a diverse set of businesses, where some, I.e. M&A, are being hit pretty hard). I have found the HFs (the ones that are doing well) are actually the main people hiring in this environment. That being said I would compare your current job security and future expected value to your new offer. If your fund isn’t doing well there is a chance this isn’t going to work out anyway. Normally the sell side is more stable, but I can’t give you a prediction with any confidence, it will all depend on how this shutdown plays out.
So to summarize: 1) you are probably underpaid, 2) new job offer is probably more stable but the environment is so risky right now you should diff that to how you think your fund will do. Wish I could provide more help.
Thanks for your thoughts. This environment definitely makes these decisions more tricky. Any thoughts on whether a large sellside desk might rescind an experienced hire offer during a noncompete? I remember in 2008/2009 analyst offers were rescinded but I never heard about that with experienced hires.
Too much uncertainty to know if offer will be rescinded. If you are senior enough you can negotiate a guarantee (signing bonus type thing) to protect yourself in the case they do rescind the offer (and also making it less likely they’ll want to). At the senior levels this happens a fair bit (I have been offered payment during non compete and large bonus to show commitment to having me join - didn’t take it but that’s the type of thing).
It would be a it strange for them to offer you a job now, when uncertainty is the highest just to rescind. If you take the offer you are betting that: 1) the firm knows what is going on and trusts their financial health, 2) that things are at the height of uncertainty now and 3) unless things get materially worse companies will have priced in the impact to their business in a reasonable way to make hiring decisions. I don’t know anything about what firm your offer is from, so hard for me to say. But that’s how I would think through it.
Right - great points. It's a solid large bank so I think they account for the uncertainty, but I don't think uncertainty has peaked. I'll see if I can negotiate anything to take the edge off that risk. Thanks.
What do you mean by credit portfolio trading? portfolio trading in corporate bonds or CVA trading?
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