HF Vs. IB as a Junior Trader

I am currently a rising Senior and I have been presented with potential oppertunities at both a Hedge Fund with AUM > 5 Billion, and one of the top 3 US Banks. I am aware that I am leaving out a significant amount of details, but generally from a macro standpoint which will be the most lucrative either now or in the future? And which will provide better exit ops? I have heard from many people that leaving the sell-side for the buy-side is like going black in that you never go back, but from a long term view which would put me in the best position?

 
Best Response

I think this entire debate relies on your responsibilities, exposure, and progression as a "junior trader"

If it is as a trading assistant for an execution guy, then it could be cool, but don't think that it would necessarily lead to more lucrative career then starting with IB. Especiallly if this is a fund focused on equities, then the title "trader" gets less investment exposure than in macro, commodity, and some arb funds. Esentially, you would possibly be pigeonholing (somewhat) to execution only.

If it is more of an anlytical/discretionary role (which is pretty rare for an undergrad at a fund that large), then that is a great starting point to learn the investment side more quickly

I think that you either have to ask more questions or answer them here if you know them.

 

It would be a fundamental equity HF, or FI at the IB (interested and experienced with both). Ultimately Id like to trade for a few years and then hit B school and move over to the asset management side as an analyst at a HF.

I always hear how people leave IB's for hedge funds, yet I rarely hear of huge success stories that stem from people who have been trading at HF's w/o ever having Banking experience.

 

I think that top IB -> HF Analyst or top IB -> top MBA will both be be easier then doing those things from a trading role at a HF.

A fundamental Equity HF will likely be holding positions for a long time in very liquid markets - there won't be much for a brand new trader to learn that would help you in the long run. Buy side trading can be a great career, and is a specialized skill - but you won't get much relevant experience to the investment side (in equities at least).

THis is why you rarely see traders on equity desks move to HFs....most equity HFs will hire from ER or IB, becuase trading is not as valuable to equity funds.

And if you go from IB to HF, then an MBA won't definitely be necessary

 
Deechie914:
I am currently a rising Senior and I have been presented with potential oppertunities at both a Hedge Fund with AUM > 5 Billion, and one of the top 3 US Banks. I am aware that I am leaving out a significant amount of details, but generally from a macro standpoint which will be the most lucrative either now or in the future? And which will provide better exit ops? I have heard from many people that leaving the sell-side for the buy-side is like going black in that you never go back, but from a long term view which would put me in the best position?

Hum, OppOrtunities is a hard word to spell but I have never seen it spelled OppErtunities.

The one who does not fall, does not stand up
 

Wow, impressed you caught that considering you graduated from a school where SAT Verbal scores from the 25th - 75th percentile range from 460-560 on the critical reading section(must not have helped you too much then) . I scored higher then that in 7th grade. Too bad your spelling skills couldnt get you inot a legitimate university, or even give you enough sense to choose a real major.


And wannabe, yes I meant as a trader for an IB, sorry if I wasnt clear. Thanks for your help.

 
Deechie914:
Wow, impressed you caught that considering you graduated from a school where SAT Verbal scores from the 25th - 75th percentile range from 460-560 on the critical reading section(must not have helped you too much then) . I scored higher then that in 7th grade. Too bad your spelling skills couldnt get you inot a legitimate university, or even give you enough sense to choose a real major.

And wannabe, yes I meant as a trader for an IB, sorry if I wasnt clear. Thanks for your help.

While the first comment may have been a little out of line, it generally doesn't do you any good to talk about how great your verbal skills were in seventh grade. Plus you made two mistakes while knocking his school/being cocky about yourself...

 
Deechie914:
Wow, impressed you caught that considering you graduated from a school where SAT Verbal scores from the 25th - 75th percentile range from 460-560 on the critical reading section(must not have helped you too much then) . I scored higher then that in 7th grade. Too bad your spelling skills couldnt get you inot a legitimate university, or even give you enough sense to choose a real major.

Doesn't matter which one you take. If you go in acting like this towards everybody, the traders at both firms are going to hate you.

 
Deechie914:
Wow, impressed you caught that considering you graduated from a school where SAT Verbal scores from the 25th - 75th percentile range from 460-560 on the critical reading section(must not have helped you too much then) . I scored higher then that in 7th grade. Too bad your spelling skills couldnt get you inot a legitimate university, or even give you enough sense to choose a real major.

And wannabe, yes I meant as a trader for an IB, sorry if I wasnt clear. Thanks for your help.

haha wtf? really? did you just go there? You are a pathetic joke. I could run circles around you mentally and physically.

The one who does not fall, does not stand up
 

So many of the posts in this thread are so unnecessary.

OP, I think rule of thumb is that unless the HF is a top tier fund, and you have been given indication that you will be given opportunities that you wouldnt find at a BB, the smart route is the BB as it opens more doors.

However, noone can make this choice for you, and you are the only judge of how good you think you are.

 

"His is why you rarely see traders on equity desks move to HFs....most equity HFs will hire from ER or IB, becuase trading is not as valuable to equity funds. "

This is why college sophomores should not be allowed to speak about things they have no idea about. Traders at hedge funds should not be confused with analysts at hedge funds or portfolio managers.

You see traders on equity desks move to execution traders on the buyside all the time. The next step is going from buyside execution trader to buyside Junior PM/Full PM. A PM has the unstanding of market dynamics that a trader has but also the analytical skillset of an analyst.Most IB guys would not transition well into a buyside PM role or if they do they first must learn the trading facets in addition to the fundamental facets.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 

Reread my post..i was talking about moving into research roles at a HF

WHAT ARE YOU TALKING ABOUT??? NOBODY GOES FROM BUYSIDE EXECUTION TRADER TO PM AT AN EQUITY FUND

I have never seen this done in my life. Where do you come up with this? equity traders rarely become HF analysts - they become execution guys

i dont know why dome little cranky kid gets respect because he has 2000 posts. Congrats you are a forum god....that doesnt mean you are an expert on anything

 

YOU ARE A FIRST YEAR ANALYST ON THE SELL SIDE!?? this explains everything - what experience do you have to say that I am wrong? Are you a PM? have your fellow desk mates become PM's?

It looks like you got very defensive (probably because you are in equities, and want to become a PM) There is nothing wrong with that - and I'm not saying that it can't be done, and I'm not knocking equities...AT ALL

But to say that an execution role at a HF is better for PM than starting on a sell-side desk is just wrong. And to say that moving as a trader on an equity desk to HF to be in an analytical role is easier/better then coming from ER or IB is ALSO WRONG

if you want to have a reasonable mature debate, then by all means - but you keep blasting my posts, without any kind of point of your own!

 

I have 2000 posts because I have been posting on the site since 2007.

I was not really attacking you per se but if you read a lot of the threads I am on there are a lot of really uninformed people. I am sorry for singling you out and accusing you of being a college sophomore... I use the term college sophmore to refer to anyone that doesnt know what they are talking about. I will give you credit where it due after reading these posts you understand whats going on just really a different view.

So lets clear some things up...

First of all regarding my experience I am in reality more like 3rd year analyst but I switched from a prop role over to the sell side. Not like I just started a month ago.

What I was saying was that a IB/ER guy does not have the experience in the markets with understanding how to manage risk that a trader does. There is a reason ER guys are in ER, its a great building block but you do not transition from ER to PM. There needs to be some sort of stepping stone that gets you experience with the execution and managing risk.

I did not say it was better to start as a buyside execution guy for experience as a PM. Most buyside execution guys indeed started on equity desks on the sell side.

I did not say it was better to start in equity than ER/IB to move into an analytical role.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 

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