How to Get Into Global Macro Hedge Fund

1) What is the path to getting into a global macro fund?
- What BB S&T desks would be the best starting points?
- Or would banking -> PE -> global macro be feasible at all?

2) Besides Moore Cap / Paulson & Co, what is a list of the best ones?

3) Can anyone explain what are their top global macro strategies right now?

4) What are their most common interview questions?

Sorry for the basic questions but this would be very helpful!

Thanks!

Comments (107)

 
May 14, 2010 - 9:57pm

2226416:
Doesn't Paulson & Co follow an event driven strategy?

Paulson has several funds. Their largest fund is event driven. Paulson is kind of like Tudor in that it has branched out into a lot of different strategies. Tudor is global macro, but it also has a PE/VC fund.

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
 
Best Response
May 14, 2010 - 9:55pm
  1. Trading and research are the most common paths. IBD has almost zero chance of getting Global Macro. IBD is better for risk arbitrage, L/S equities, distressed debt investing, and value investing styles.

  2. Moore, Soros, Tudor, Brevan Howard, Clarium, and Caxton Associates are the biggest/most well known, although there are a lot of mid size firms.

  3. Global Macro is the strategy....not sure what you are asking (a firm could be long or short equities, bonds, commodities, and currencies using a variety of instruments.)

Do a search on the hedge fund forum.

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
  • 3
 
May 14, 2010 - 10:46pm

bcsisbad:
Thanks! Which trading desks would be most relevant to get into these funds?

For global macro the best desks are FX and rates because they are the most macro products. Commodities and emerging markets are also good choices.

Search the hedge fund forum and do specific searches on these products to learn more. There are a lot of good contributions.

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
 
May 14, 2010 - 11:06pm

No idea. I assume you would find that out once you are on a S&T desk and start looking.

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
 
May 16, 2010 - 6:51am

as for 3) i think OP wants to know what within global macro (e.g. for l/s, some do pairs trades, some just do bottom-up stock picking l and s)

i want to know if any prop traders go to moorecap etc... of course, there ain't the same sort of prestige, but if you're trained well, if your p/l is great, and if you do a lot of reading outside of work and are passionate about an area of economics (after all, they have very good hours), then i don't see how they would necessarily be any worse off in the interviews

 
May 16, 2010 - 8:18am

I work at a fairly large global macro group in a diversified hedge fund. we don't take that many sell-side traders (not because we dont need them, but simply because we don't need that many of them- its not like we're actually making markets), most of our people are research and come from 1. other hedge funds/asset management and 2. research at banks/various other entities (e.g. world bank, imf, even have a couple guys from various think tanks). 3. good grad programs.There is no right path. But if I was in charge I'd prefer people from research at a BB.

word of advice- you're basically researching career paths into global macro and chose to use glib comments on wsoasis from people quoting "Wall Street". Not the most credible source for research (whether of not he is right). there are better ways (just one example- going on linkedin and paging through the resumes of people working at GM funds)

 
May 16, 2010 - 9:36am

regarding infos on strategy, thinking and the work itself i would recommend The Invisible Hands: Hedge Funds Off the Record by Steven Drobny.

Im a student so I cant really speak how usefull it is but it definetely is an interesting read that explained a lot to me.

 
May 16, 2010 - 2:41pm

Seigniorage is dead on. If you want more info on this, bondarb also works at a global macro fund, if you track through his past posts I'm sure he's covered everything you've asked. Most of the guys I know at macro funds have the sort of backgrounds seignorage describes. I don't know anyone in macro who doesn't have some sort of econ degree.

 
May 17, 2010 - 10:19pm

I work in a portfolio management group that is made up entirely of former sell-side traders...in fact i am the only risk-taker in the group who has never been a market-maker...so that is definitely a path sometimes. But as i have posted many times before people come from everywhere...ive worked with PMs who were previously research people, previously central bank officials, have been life-long buy-sde traders, and many other things. Research is a very popular path to get hired where i work as analyst but rarely leads to being a PM....sometimes they will give analysts small balance sheet within their niche but almost none have the broad product knowledge to really be macro portfolio managers. For eg the New Zealand Economist will be allowed to put on a small position and get paid if his/her call on kiwi interest rates pans out but will never be allowed to trade other markets or get big enuff to make alot of money (relative to what is considered alot in this world at least).

If I was creating the perfect macro PM I would start him on the money market desk at a sell-side bond dealership..i think interest rates are the building blocks for all the markets and they also in my opinion require the most specialized knowledge. Once you really understand the mechanics of the rates markets it makes everything else much easier. Unfortunately this type of job no longer has any "prestige" so its a rare path nowadays.

 
May 17, 2010 - 10:21pm

Also in regards to strategies...any hedge fund that is as big as Moore, Tudor, Soros, etc is going to have many many different strategies. Putting over 10bn dollars to work is really difficult if ur not using all the markets..almost all these funds have equities, credit, and even PE/VC along with the more "traditional" macro products of rates, FX, and commodities.

 
May 19, 2010 - 4:26pm

Hi guys, this post is very helful.

My goal is to get a job at a macro hedge fund and I wanted to get some advice on my upcoming career move - if that move will help me get the macro hedge fund job.

Background: Currently working for a small asset management firm (research and portfolio mangement). Previously, have 1 year associate level experience at a BB IBD and I have an MBA from a top-7 business school. Total post MBA experience of only 2 years.

I am planning to take a research job in the BB equity strategy group and was wondering if this move will help me in macro hedge fund job search - I believe that curently I am missing substantial macro research experience and this BB experience might help

Any advice/suggestions are welcome - is this move a good move

Thanks in advance

 
May 20, 2010 - 7:57pm

bb_research:
anyone?

I suggest re-posting your question as its own forum topic.

"Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA."
 
Feb 5, 2014 - 4:04am

global macro funds (Originally Posted: 01/01/2011)

it seems like the top macro funds (tudor, moore, Caxton, soros, etc) tend to hire PM's more than junior people (please correct me if i'm wrong). for those who with knowledge of these types of funds, any advice on how to get in as a junior person?

it seems like prop trading or another hedge fund is the most common way (though this then becomes circular). are larger funds that seem to hire more junior people (like Citadel, DE Shaw, Bridgewater) a better target? what about s&t at a bank?

any insight would be appreciated. thanks

 
Feb 5, 2014 - 4:05am

PMs make up a small percentage of the employees at large macro funds...for eg doing quick math in my head at my firm we have about 1 PM for every 15 "other employees". However, the other front-office guys (research analysts, execution traders, etc) are not very "junior" in most cases. Where i work our research guys are generally on par with a head of research-type on the sell-side and their teams tend to have alot of experience. The execution guys usually traded on the sell-side for some time or came up through operations within the firm. We only have 1 or 2 people who i would call "junior" in our whole office (outside of ops) and although I am not 100% sure i think they got there in part through family relationships.

 
Feb 5, 2014 - 4:08am

I became a CMT. It will help in both aspects of your networking and experience.

www.mta.org

PM if you have any questions abut the program.

Please don't make me talk to you like an asshole...
 
Feb 5, 2014 - 4:10am

Thanks guys for the response. Two follow up questions:

a) Several "macro" funds like Citadel, DE Shaw, BWater, AQR, etc (as originally mentioned) do hire junior people (undergrads, MFE's, PhD's, experienced hires with 1-3 yrs relevant experience, etc) for their investment teams. Based on your comment though, Bondarb, would you say this is less true for the more classic global macro players? (To be more specific, when I say junior people, I mostly mean those with 1-3 yrs of relevant experience)

As a followup to that, it also seems that a lot of smaller (though very legit) macro funds do hire smart "junior" people with some relevant experience so they can mold them. I was under the impression a larger fund would be a better "training ground," but again, it seems that these larger funds tend to hire people who already know how to make money... Would you agree/disagree with that assessment?

b) Would a sell side macro oriented desk (let's say FX) be a good stepping stone? Not so much for positions as execution traders, but rather as someone on the investment team (i.e. research analyst or junior pm or whatever title is typically used). Seems to me as an outsider that such an experience on a sell side desk is valuable in the sense of learning the specifics of the instruments traded and getting an intuition for certain markets, but may not provide training for developing a view on global themes or a thorough understanding across asset classes (as opposed to a prop desk which presumably develop those skills). For anyone who may be on the "inside" please correct my impression if it is incorrect.

Thanks guys

 
Feb 5, 2014 - 4:09am

I think your are missing the point Penny. In all reality it truely doesn't matter what desk your on, or which firm you started at, or your background (IB,HF, Prop Firm). The name of the game is results. Nobody will hand you shit. No matter where you go....if you leave that place known as the #1 guy everything else will fall into place. I know I make it sound simple but that is the nature of the beast.

Please don't make me talk to you like an asshole...
 
Feb 5, 2014 - 4:12am

For the MBB question, you could potentially network your way into a global macro fund. I think you'd have to go get your MBA and/or CFA to show them that you really want to change career path and get into investing.

Other than that I'm not sure of a clear defined path to global macro. Google some firms and see if they have investment professional bios. I don't think ER would be good. Trading is probably your best bet.

-- "Those who say don't know, and those who know don't say."
 
Feb 5, 2014 - 4:14am

Generally, it seems most people in funds with that strategy have more of a trading background than research or banking.

I am permanently behind on PMs, it's not personal.

 
Feb 5, 2014 - 4:18am

//www.wallstreetoasis.com/forums/how-to-get-into-global-macro-hedge-fund

The short of it is, there's no single answer to that question. The original global macro funds were started by both people on the equity side (Soros/Robertson/Steinhardt) and people on the commodities side (Kovner/PTJ/Moore). A lot of the newer funds were started by people with BB prop experience in rates/fx/commodities.

 
Feb 5, 2014 - 4:20am

Bankers don't make it into macro funds then? I know there are always exceptions, but everything I've read and seen seems to indicate that IBD is an ill fit for macro strategy.

I am permanently behind on PMs, it's not personal.

 
Feb 5, 2014 - 4:24am

Global Macro Hedge Fund Entry (Originally Posted: 03/04/2012)

What desks at a BB would offer the best preparation for someone looking to get into/set up a Global Macro hedge fund?

A bit optimistic but may as well dream!

Thanks

 
Feb 5, 2014 - 4:25am

No set path. Look at rates (esp. at JP) and FX trading. Economic research (which JP is also good at) is another option.

To be honest, I have not heard of many JP to hedge fund transitions; the ones I've read about are GS of course, and Citi, CS, DB, MS to a lesser extent. They may well exist, I just might be out of the loop.

 
Feb 5, 2014 - 4:31am

How to get into Global Macro Hedge Fund in Asia? Any good names? (Originally Posted: 08/15/2012)

Folks,

Global macro hedge fund is a mystery in Asia. I would be very grateful if you could point me to the right direction as to how to get there.

About myself:
4-year sell-side experience in Asia Equity Strategy in 2nd-tier broker not BB
1-year (currently) experience in Asia consumer in reputable long-only fund
Qualifications: CFA, FRM, CAIA
Going to do a Phd in economics starting from Sept (takes three year to complete)
Located in Beijing

Cheers
HH

 
Feb 5, 2014 - 4:33am

HH:
ER in reputable long-only fund
Qualifications: CFA, FRM, CAIA
Going to do a Phd in economics starting from Sept (takes three year to complete)

Q

  1. What kind of Phd gets done in 3 years?
  2. How on earth do you know in advance how long it will take you? If you're just guessing , 3 years is a terrible guess.
 
Feb 5, 2014 - 4:37am

Big shops are Dymon, Fortress (SG), Brevan. That's really it. There is also Counterpoint and Complus (much smaller). Not a ton of Macro in Asia... Some of the big globals might have an office with a few traders but that's really it. Macro by far much much bigger in London and NYC.

I used to do Asia-Pacific PE (kind of like FoF). Now I do something else but happy to try and answer questions on that stuff.
 
Feb 5, 2014 - 4:41am

Brandon you are right. But you have to remember that Levinson has one of the biggest funds out here and very strong Fortress support, even though he is spinning out (but will still have some affiliation with them). The one thing about an Asia-centric macro strategy is that liquidity drops off quite a bit in a number of countries/instruments and the fx markets here are much much smaller than that of London/NYC flow-wise (not to mention others). Levinson's portfolio is also very equity heavy - I know this for a fact- he has a notable fundamental team on the ground here in Asia. His edge as he mentions is that he doesn't really sleep much and works something like an extra half day or more per week. He trades Asia, works out/does other stuff in the early/mid afternoon "lull", then Europe comes on and he covers a bit of the US as well.

I used to do Asia-Pacific PE (kind of like FoF). Now I do something else but happy to try and answer questions on that stuff.
 
Feb 5, 2014 - 4:47am

Breaking into a Global Macro Fund as a Non-Quant (Originally Posted: 08/29/2013)

Before I get shit blasted for not using the search function, i'm at work and search doesn't work.

I know that this has been discussed in the past but I thought its about time to open up another thread dedicated to it. What are some paths that Non-Quants take to global macro funds? The more I learn about Macro trading the more convinced I am that it is a 50/50 split between an art and a science (maybe even 60/40). So I ask what are some common paths for the Non-Quant to take to break in in this day and age or is there simply no room left for the non-quant since the space is so crowded...

 
Feb 5, 2014 - 4:52am

You don't need a quant background for discretionary macro. I would go as far as to say you only need to be numerate for quantitative macro. Louis Bacon majored in Eng Lit, Kovner in Pol Sci, Soros in Philosophy and PTJ claims that the summer courses he took in writing were far more beneficial for macro trading than his Econ degree - the list could go on forever.

Found those tags amusing, stay off ToS, that's retail bro...

 
Feb 5, 2014 - 4:55am

@ Macro, hahah i'll see what i can do, can't quite afford the bloomberg terminal justtt yet.

@mbavsmfin, partially agree but really disagree. Markets aren't static and quantitative finance holds so much "real" predictive power. Macro trading has a large qualitative/critical thinking component to it that I highly doubt any algorithim could ever replicate.

I guess why I started this discussion is because there is no direct path(s) to a macro fund. However, in the era we live in (obsessed with education) i guess i'm curious what are some of the most common paths. Macro trading is a very personal/individualistic endeavour and in my opinion there isn't any degree/specific education path but what are some of the most common paths in most recent times

either a stint in BB FICC or prop trading?

 
Feb 5, 2014 - 4:56am

What if you have economics background, and is assistant fund manager in global investment at a pension fund (70% invest in fund of funds, 30% invest directly but only in ETFs etc.).

What this be possible to get into global macro hedge fund?

 
Feb 5, 2014 - 4:58am

I don't think you need any kind of advanced quant degree to break into the macro world or excel there. To me it is really about finding people who are smart and disciplined enough to become knowledgable about the markets and trading but also creative enough to think about things differently and create unique trading ideas. Unorthodox backgrounds easily can become selling points if presented correctly.

 
Feb 5, 2014 - 5:00am

So many misconceptions on this website so stop repeating 1.

I know many non quant guys on macro desks at GS, MS, etc etc. Most of them only have a bachelors and it's non quant. To reiterate BondArb point, macro is probably one of the more discretionary trading roles out there so creativity, gut, knowing macro correlations and most importantly, knowing how to manage risk are all things looked for in macro traders.

 
Feb 5, 2014 - 5:01am

just want to touch upon another misconception that i wish i had known about earlier:

working on the sellside isnt a prereq for macro. there are many people running risk at macro funds who havent spent a day making markets and these days the guys who are jumping over to macro funds from the sell side are usually desk heads etc. i think the emerging trend, if there is one, is to report to a guy with a lot of street cred and hope they take u under their wing - start as a research/ strategist or ops guy for a well known pm or fund manager and take things from there. as for getting there, plz see bondarbs advice above (and old posts). you gotta be pretty fucking awesome...

 
Feb 5, 2014 - 5:04am

How to start at Global Macro hedge fund? (Originally Posted: 05/14/2015)

Firstly, just wanted to thank this site and the people on it for the incredible quality of content, I can't tell you how useful all this information has been in narrowing down my career options. So thank you.

As some of you may remember, I'm a student studying a quantitative degree at a top UK university who's extremely interested in working at a Global Macro hedge fund sometime in the future. Now, I've posted on this board a couple of times asking broad questions relating to this topic and always received thorough answers to my queries and one of the major recurring theme's that came back in those responses, as well as from other forums, is the idea that prop at BB's is dead, which was formally the best place to learn the skill set required for a GM trader/portfolio manager, and that today the ideal place to start a career in this industry is directly at a GM fund.

Now what I wanted to ask today was,

1) How does one get a seat at one of these funds straight out of university? Considering hedge funds are illustriously secretive and pretty small so are unlikely to have some large HR department to deal with graduate applications; plus I've never seen a advertised position for graduates out there. Please also take into account I don't have some large set of contacts I can ask for assistance, and the response 'network' doesn't help as I clearly don't have anyone to network with.

2) What sort of role do graduates tend to take and what are the time-frames for progression? (Roughly, I know that there is no set process and it depends on the fund). Clearly they don't just let some ambitious kid walk into the fund and take the reins of a book; so do they tend to start in a back office role or as a 'trading assistant', to fetch coffee and learn from an experienced trader, or do they take a more analytic role where they research a specific market/country/sector? If anyone has actually done what I'm hoping to do, or better yet is currently doing it, I'd love to hear your experiences.

Once again, thank you in advance for any responses and if anyone feels responding directly might compromise their position please PM me instead.

Cause who wants to be in the 99%?
 
Feb 5, 2014 - 5:06am

Thanks, I've seen it before but that comment by brotherbear is pretty epic!!

Cause who wants to be in the 99%?
 
Feb 5, 2014 - 5:10am

i know a couple guys who recently went from BB rates trading (govie desk, swaps desk, vol desk) to some of the larger global macro funds, whose names you would know. The bank prop desks used to be the more natural route, but since most of those don't exist anymore, the market making desks of the big banks are the "easiest" route in.

Very few people will get the chance to actually take risk on the BB risk taking desks, and since those desks don't really interview that many people, its always a crapshoot. There are only a few hundred people in the real risk taking BB seats at any given time, which really is not that large when you think about how many people want to get in the door.

 
Feb 5, 2014 - 5:17am

Path to Global Macro/Event-Driven HF (Originally Posted: 12/24/2009)

Whats the most common path towards working in a HF style similar to Soros or Paulson where make large, well researched, Macro bets?

S&T (Particularly what products) = Commodities, FX, Rates
IBD

 
Feb 5, 2014 - 5:21am

Also this is directed at Bonbarb. I read your posts that alot of Global Macro people come from FI S&T, but i was wondering if those Macro shops tended to be shorter term trades vs. the longer term trading style of Paulson/Soros?

"Successful investing is anticipating the anticipations of others."
John Maynard Keynes

 
Feb 5, 2014 - 5:22am

Also curious, do most people come from a spot/forwards or a derivs/vol background (or is it a healthy mix)?

Jack: They’re all former investment bankers who were laid off from that economic crisis that Nancy Pelosi caused. They have zero real world skills, but God they work hard. -30 Rock
 
Feb 5, 2014 - 5:24am

4 paths to macro HF - which is optimal? (Originally Posted: 10/14/2011)

Does anyone know how these paths compare in terms of exits to macro hedge funds (please provide rationale and anecdotes if possible)? If you would also like to comment on compensation adjusted for lifestyle/hours should you fail to get the macro hedge fund exit, please feel free.

  1. AM at a large MF company
  2. BB trading (flow, of course)
  3. BB research
  4. Prop desk at a SWF

Assume all roles are in rates/fx. Thanks.

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