Hi.
I have been working at a large Quant hedge fund as a researcher for about 5 years. My next big target is to move into a Quant PM role. At my current shop this is basically impossible, since this is large fund with only a few PMs, who all have more than 15 years experience in the industry. Career growth for a researcher stalls after 4-5 years.
I wonder what's the best way for me to proceed. Over the last years I worked very closely with one of our PMs and could learn a lot about what this job entails. I got exposure to the full research cycle and would be able to set a strategy pod up myself at a new firm. However, I do not have a PnL stream which can be attributed directly to me and if I read job ads most roles require someone to already have several years experience trading a strategy with a certain realised sharpe.
What is the best way for me to move forward? Have some of you made the move from Quant to PM and could you tell me about your experience?
What is the interview process like for Quant PMs? Is it similar to Quant researchers, i.e. lot of technical questions and brainteasers plus question the strategies to intend yo run?
Thanks for your suggestions!
First of all, you want to decide if it's worth it. Being a PM is a very high risk proposition and the probability of failure is significant. I'd say that half-life for an average quant PM is 2.5 years, with 5 years being the point when you more or less reach a cruising altitude. For example, the strategies that you have - what do you think are the half-lifes of your alphas? What are the correlations and how mainstream is the stuff that you do? In short, what would you do if none of it works next year?
If you do decide that it's worth your time, the next step is to network aggressively. Don't look at the job ads, as most of these are posted by HHs who will be of no help (they, invariably, will want to place your into another research seat). Sooner or later you will find a few shops to talk to, especially if what you are offering is relatively uncommon.
Most of the interview is going to strategy-level discussions or discussing risk/infrastructure/process. Have a good development plan in mind, have a list of strategies with infrastructure requirements and deployment order, have ideas when stuff will work and when it will not etc. In short, have a battle plan and be ready to discuss it.As you get more senior, you should get fewer and fewer brain teasers or programming questions. My prior would be that if someone does ask you a programming question at a PM interview, avoid that shop.
Great advice, thanks a lot. May I ask how many years experience you had before moving from the sell side into a PM position? I assume you already had some strategies, with low correlation to traditional stuff from your sell side position? Good point about the networking. Really need to get up to speed here as I don't know enough people yet. Would you suggest to directly contact people in PM recruitment and see if they might want to grab a coffee?
Yes and no. A lot of stuff I used to do had to be tweaked to be more appropriate for the buy side.
Yes, it never hurts. This said, conditions for PM roles vary a lot (anything from base salaries to risk parameters) so be ready to kiss a lot of frogs before you find that once price.
From my (rather limited) understanding, you can also make the move if you have just a backtest. Although this obviously isn't as good as a real track record.
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