Fund of Funds and Asset Modeling at Insurance company

baseball546789's picture
Rank: Chimp | 15

Wrote a lot of stuff and a lot of questions but this is one of the hardest decisions i've ever had to make. If anyone can answer any of these questions of give any insight I would appreciate it very much. Objective: To pick the job that is going to put me in the best position in two years if I decide to look for a new job.

I am trying to decide between two positions. One of the positions is a Research Associate at a Fund of Hedge Funds. The other position an Actuarial Assistant in the Asset Modeling Group (Part of the Asset Liability Management Department) at a big life insurance company. I posted some highlights of the job descriptions below.

What I am really concerned about is which is going to provide me with a better potential future. Which position is going to leave me in a better place after two years? In two years, I would like to either work at a Hedge Fund or pursue a MBA or MFE to become a quant. I love investments and I do not have much investing experience, so another one of my goals is to learn about investing so I can become a successful investor on my own and possible start my own HF or company.

So yeah it may seem that I am very unsure of where exactly I want to go two years from now but I want the best options, the best experience to set me off in the right direction if I decide to pursue a more prestigious investing career.

My concerns about going with the ALM position is that I won't gain as many networking contacts as I would at the FoF. Also, my concern is that I would miss out on learning about Hedge Funds and investing strategies at the FoF. Also, will the fact that the ALM job is at an insurance company negatively affect my resume?

At the FoF's am I actually going to gain the knowledge required to invest?

How much would meeting HF managers actually help my future career path?

Actuarial Assistant **********

The Asset Modeling Group's main focus is the accurate projection of cash flows and income statements for the company's general account assets under various interest rate scenarios for the purposes of statutory and GAAP based financial reporting. The department is currently in the middle of a re-engineering process, so the student would have the opportunity to be a part of a team that is building a quicker, more efficient, and more accurate asset modeling production process.

Principal Responsibilities:
* Review assigned asset sector(s), such as Public Corporate Bonds, over many interest rate scenarios and be able to explain any projection results by using analytical tools.
* Review the modeled data at various rollup levels to ensure its completeness and accuracy.
* Reconcile analytics from the modeling process, such as duration, weighted average life, book yield, etc. with other sources.
* Use SQL queries to trace issues and do ad hoc analysis of the asset modeling data that resides on our servers.
* Become quickly acclimated with asset classes, product features, financial terminologies, and production processes.
* Learn and use Kamakura Risk Manager modeling software for test runs and various projects.
* Partner closely with IT to help on different business aspects of the re-engineering project.
* Complete ad hoc assignments.

Qualifications:
* Pre-ASA or equivalent experience
* Excellent organizational, mathematical, and analytical abilities
* Strong verbal and written communication skills
* Must work well with teams and be a quick learner
* Knowledge of financial products and features such as fixed income securities, structured products, and derivatives is a plus
* VBA, SQL, Matlab and other programming knowledge is a plus

Research Associate ********

Candidate will function as part of the Research team which is responsible for hedge fund manager identification, due diligence, monitoring, and portfolio construction for approximately $9.4bln in assets. Hedge fund strategies supported by the team include long/short equity, event- driven, convertible arbitrage, specialist credit, relative value, FX, global macro and alternate strategies.

The position will have a quantitative as well qualitative focus and will primarily involve the following -
* Preparation of written research reports and quantitative analytics on individual hedge fund managers
* Analysis and screening of the hedge fund manager universe
* Market research on various hedge fund strategies
* Maintenance of manager data in various databases

Required Skill Set
* Strong writing skills
* Strong Microsoft Excel and PowerPoint skills
* General knowledge of finance and capital markets
* Good knowledge of Bloomberg and Microsoft Access is preferred

Comments (18)

May 10, 2011

Comment withdrawn... others have made wise comments. heed their words.

"The American father is never seen in London. He passes his life entirely in Wall Street and communicates with his family once a month by means of a telegram in cipher." - Oscar Wilde

May 10, 2011

Does researching hedge fund managers actually give me valuable experience? Is it going to teach me to invest and prepare me for a good job on wall street? or is it only going to prepare me for another FoF job or investment management job?

May 10, 2011

Can you post more info about the ER position? Do you know exactly what sector you'll be covering?

What do you want to do for exit op?

May 10, 2011

I want to either work at a Hedge Fund, get and MFE and get a quant job on wall street. The other option is to avoid grad school and get a quality job on wall street such as a trader. Those are my main exit op considerations.

May 10, 2011
baseball546789:

I want to either work at a Hedge Fund, get and MFE and get a quant job on wall street. The other option is to avoid grad school and get a quality job on wall street such as a trader. Those are my main exit op considerations.

comment withdrawn

"The American father is never seen in London. He passes his life entirely in Wall Street and communicates with his family once a month by means of a telegram in cipher." - Oscar Wilde

May 10, 2011

If you want to go the MFE route, the ALM job makes more sense. The "real finance" comment is ridiculous. Keeping a database of HF managers isn't real finance, more like glorified PWM. However, there's a chance you could network into an actual HF, particularly if you spend some time on portfolio construction. The skills in the ALM job are much closer to "real finance," but you'll be further removed from a networking perspective. Your call.

edit: Basically, if you want to do something quant, the FoF isn't going to do you any favors. However you probably won't be able to go straight from ALM to a HF without an MFE or sell-side experience.

May 10, 2011

@fof's all you do is due diligence on hf managers and strategies. you don't put money to work, instead look at who can put the money to work at a risk adjusted basis. doesn't really prepare you for realy finance work, but you will learn a lot about money management, specifically hedge funds

May 10, 2011

I mean real finance by sell side and buy side....im not sure if fof's fall into oeither one

May 10, 2011

FoFs are buy-side, but they invest in HFs which is a far cry from direct investing.

May 10, 2011

Thanks for all of the responses and comments they are all very helpful. Any comments or thoughts on the specifics of the work in ALM (Asset Modeling) that I would be doing and how that relates (or doesn't) to investing / trading / hedge funds?

May 10, 2011

That position looks like a lot of interest-rate modeling, something you'll often see demanded of quants whether at banks or on the buyside. I hear this is a good book on the subject but it's not exactly introductory: http://www.amazon.com/Interest-Rate-Risk-Modeling-... I would just search though it and see how much that kind of stuff interests you.

May 10, 2011

YO i think you are getting bad advice here. I would take the insurance company job. Insurance cos are on the buyside and this sounds like legit, quantitative experience. Don't be a whore to telling people you work at a hedge fund who the hell cares what matters is what experience is going to help you reach your goal and I would choose the insurance company. However, you prob are young and not in the know of things so I can see where you're coming from and am not insulting you for thinking FoF would be decent; which it is too don't get me wrong.

May 10, 2011

I got into fund research and selection.

And to be honest, it bores the hell out of me.

Yes, you'll sit down with plenty of fund managers and analysts. Having gone through whatever education and qualification you are bound to you will probably know more about valuation methods and processes than 90% of the twits you interview. The problem is that you get pigeonholed doing this and will, if you spend too long there, never get any closer to doing any kind of real analysis. Stock models? You will see a thousand shitty stock models and know you could make far better ones, yet never have the chance. Your view about anything relating to the market is usually irrelevant. It's a job where you are clever and drink and eat with people and do fuck all generally.

So the question is: What do you want to do with your life? Do you want to get an OK salary, do fuck all and eat and drink with people? Or do you want to build models of stuff?

If the latter, go for the insurance job. If there's something that means you can't pick it, go for the FOF one but exit as soon as you can.

I hate my life but have become too lazy to change it and doing so is tough at this point anyway. Feels bad man.

Edit: "or is it only going to prepare me for another FoF job" - Yes.

May 10, 2011
SpiderMonkeyOhYes:

So the question is: What do you want to do with your life? Do you want to get an OK salary, do fuck all and eat and drink with people? Or do you want to build models of stuff?

Neither? Both sound horrible.

"The American father is never seen in London. He passes his life entirely in Wall Street and communicates with his family once a month by means of a telegram in cipher." - Oscar Wilde

May 10, 2011

here's why the insurance job is better, you'll be doing quant fixed-income analysis brother. You would be an idiot not to take it, actually....

The Asset Modeling Group's main focus is the accurate projection of cash flows and income statements for the company's general account assets under various interest rate scenarios for the purposes of statutory and GAAP based financial reporting. The department is currently in the middle of a re-engineering process, so the student would have the opportunity to be a part of a team that is building a quicker, more efficient, and more accurate asset modeling production process.

* Review assigned asset sector(s), such as Public Corporate Bonds, over many interest rate scenarios and be able to explain any projection results by using analytical tools.
* Review the modeled data at various rollup levels to ensure its completeness and accuracy.
* Reconcile analytics from the modeling process, such as duration, weighted average life, book yield, etc. with other sources.
* Use SQL queries to trace issues and do ad hoc analysis of the asset modeling data that resides on our servers.
* Become quickly acclimated with asset classes, product features, financial terminologies, and production processes.
* Learn and use Kamakura Risk Manager modeling software for test runs and various projects.

* Excellent organizational, mathematical, and analytical abilities
* Knowledge of financial products and features such as fixed income securities, structured products, and derivatives is a plus
* VBA, SQL, Matlab and other programming knowledge is a plus

May 10, 2011

Hey, there's a lot to say for modelling. You can figure out how things work and craft something to predict the world. If you are awesome you can tell everyone. Respectable work that.

May 11, 2011
SpiderMonkeyOhYes:

Hey, there's a lot to say for modelling. You can figure out how things work and craft something to predict the world. If you are awesome you can tell everyone. Respectable work that.

n00b

"The American father is never seen in London. He passes his life entirely in Wall Street and communicates with his family once a month by means of a telegram in cipher." - Oscar Wilde

May 10, 2011
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