Officially Out of the HF Business

Mr. Pink Money's picture
Rank: King Kong | 1,044

Might as well make it official and say I have left the HF business to pursue other interests on good terms and performance numbers. We all go through a period of self-reflection (usually annually around bonus season) and after several cycles I've decided now was a good time for me to exit. I'm not getting any younger.

I probably top ticked the market when I actually decided to walk away and while it's extremely tempting to get back into the game during this volatility I remind myself I have other long-term personal investments & goals to work on. I would not forgive myself if I didn't pursue them no matter how financially lucrative buyside is.

Please feel free to remove my hedge fund status here lol since I will now be a part of the peanut gallery looking in.

It has been a fun journey and love investing. I'll invest again at some point - but under a different investment vehicle vs. a HF structure. I've enjoyed sharing my experiences under this handle over the years and will continue to do so when I have time (as well as myself on other platforms).

----Mod Note (Andy): the following is pulled from a comment inside the thread

Kenny_Powers_CFA:

Some prompts if you feel like it:
a) Best single piece of advice you've received
i) About investing?
ii) About career/work generally?
iii) About life generally?

b) Best trade you've ever had and why it was the best/how you knew it was a gonna be a winner?

c) Biggest (investing) mistake you've ever made and what went wrong?

Best Investing Advice:

Understand the value add the customer gets from using the product. Economic moats aren't built by companies. They're built by customers feverishly digging to protect something very important to them. This is how I've found many multi-year compounders (I hate that term btw).

Best Career Advice:

Get really good at recognizing and finding talented people who get shit done. It's just as important as being a great investor. It should be your mission to be the best talent evaluator in the room. It will help you in your recruiting, networking, and investing.

Best Career Politics Advice:

Your first 100 days are a big deal. A lot of positive and negative attributes are cemented during this period as colleagues try to figure out what you're about. Any seemingly small action become a big deal. You'll only be known for a few things so make them count.

Bonus Career Advice:

You'll learn the most in fast growing or failing organization.

Best Life Advice:

Life isn't a neat progression. It's a step function with sudden changes. Stay humble when you're on top (it can go away fast), but never forget things can improve greatly no matter how bad things look.

Best Trade:

Not throwing out names but you can probably get a sense of what they are...Best investments have been in tech sector where I capitalized on the market not properly pricing in extraordinary network effect / scale businesses that customers loved and/or viewed as mission critical. On the flip side, my best shorts came from this space as well. I know I have a winner when a big competitor tries to copy them (hammers the stock) but upon deep due diligence learn customers are not only switching [edit: switching to the upstart from legacy ways or are not embracing the big co. offering] but the company is still taking market/wallet share in key areas. When the noise clears up, you get some massive stock appreciation.

Biggest Mistake:

Plenty to discuss but primary is selling winners way too soon. I don't mind losing money if I understand the drivers and anticipated them as a risk factor when getting into a position. It's the surprises (that I should have known) that are not acceptable. Losing money more often than not comes from not really understanding the business in the first place. Finally, there are occasions when people more senior than you are committed to a certain position and it clouds your objectivity. Huge mistake have come from in-bound pitches able you from 'smart' investors.

Comments (45)

Jan 18, 2016

What kind of long-term personal & investment goals do you have that you still haven't reach them? Did you make up these goals when you were in college or did they come during the time you were working?

Jan 18, 2016
Name Of Profit:

What kind of long-term personal & investment goals do you have that you still haven't reach them? Did you make up these goals when you were in college or did they come during the time you were working?

They wouldn't make sense in a vacuum and not knowing my background. You'd either think I'm crazy or want to come along for the ride. Being a career PM running LP money was never a long-term goal.

Jan 19, 2016
Mr. Pink Money:

They wouldn't make sense in a vacuum and not knowing my background. You'd either think I'm crazy or want to come along for the ride. Being a career PM running LP money was never a long-term goal.

I'm going to interpret this as you want to spend the next year living in a brothel in Tijuana. And YES, I definitely want to come along for the ride.

Jan 18, 2016

Best wishes to you, man. Thank you for all the advice and knowledge you've imparted to us younger monkeys over the last several years.

Jan 18, 2016

Best wishes, spent lots of time reviewing your old posts

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Jan 18, 2016

Good luck.

Jan 18, 2016

Best of luck.

Jan 18, 2016

Good luck.

I'm guessing you're the anonymous poster from a few days ago. Going to bum it for a few months, travel and relax?

Jan 18, 2016

maybe, but mr. pink money, if i recall correctly, focuses on special sit. longs, not macro. don't see why he would have made an anonymous post and also changed his investing focus for the anonymous post.

Jan 18, 2016

Actually I'm someone else on here.

I did quit though seems like a bunch of folks are leaving. 3 other HF guys I know all quit this past friday to just go and live life

    • 1
Jan 18, 2016
Dingdong08:

Good luck.

I'm guessing you're the anonymous poster from a few days ago. Going to bum it for a few months, travel and relax?

Not me.

No relaxing for me. Ready to work on the next thing.

    • 1
Jan 18, 2016

Good luck, thanks for all your posts!

Jan 18, 2016

Congrats on a successful career. Good luck!

Learn More

814 questions across 165 hedge funds. 10+ Sample Pitches (Short and Long) with Template Files. The WSO Hedge Fund Interview Prep Course has everything you'll ever need to land the most coveted jobs on the buyside. Learn more.

Jan 19, 2016

Plan on working on a startup, Pink Monkey?

Jan 19, 2016

Some prompts if you feel like it:
a) Best single piece of advice you've received
i) About investing?
ii) About career/work generally?
iii) About life generally?

b) Best trade you've ever had and why it was the best/how you knew it was a gonna be a winner?

c) Biggest (investing) mistake you've ever made and what went wrong?

    • 2
Best Response
Jan 18, 2016
Kenny_Powers_CFA:

Some prompts if you feel like it:a) Best single piece of advice you've receivedi) About investing?ii) About career/work generally?iii) About life generally?

b) Best trade you've ever had and why it was the best/how you knew it was a gonna be a winner?

c) Biggest (investing) mistake you've ever made and what went wrong?

Best Investing Advice: Understand the value add the customer gets from using the product. Economic moats aren't built by companies. They're built by customers feverishly digging to protect something very important to them. This is how I've found many multi-year compounders (I hate that term btw).

Best Career Advice: Get really good at recognizing and finding talented people who get shit done. It's just as important as being a great investor. It should be your mission to be the best talent evaluator in the room. It will help you in your recruiting, networking, and investing.

Best Career Politics Advice: Your first 100 days are a big deal. A lot of positive and negative attributes are cemented during this period as colleagues try to figure out what you're about. Any seemingly small action become a big deal. You'll only be known for a few things so make them count.

Bonus Career Advice: You'll learn the most in fast growing or failing organization.

Best Life Advice: Life isn't a neat progression. It's a step function with sudden changes. Stay humble when you're on top (it can go away fast), but never forget things can improve greatly no matter how bad things look.

Best Trade: Not throwing out names but you can probably get a sense of what they are...Best investments have been in tech sector where I capitalized on the market not properly pricing in extraordinary network effect / scale businesses that customers loved and/or viewed as mission critical. On the flip side, my best shorts came from this space as well. I know I have a winner when a big competitor tries to copy them (hammers the stock) but upon deep due diligence learn customers are not only switching [edit: switching to the upstart from legacy ways or are not embracing the big co. offering] but the company is still taking market/wallet share in key areas. When the noise clears up, you get some massive stock appreciation.

Biggest Mistake: Plenty to discuss but primary is selling winners way too soon. I don't mind losing money if I understand the drivers and anticipated them as a risk factor when getting into a position. It's the surprises (that I should have known) that are not acceptable. Losing money more often than not comes from not really understanding the business in the first place. Finally, there are occasions when people more senior than you are committed to a certain position and it clouds your objectivity. Huge mistake have come from in-bound pitches able you from 'smart' investors.

    • 17
Jan 21, 2016

First, congrats on your success, tremendous value you added to the WSO community, and best of luck in your future endeavors.

Second, I had a question about your best life advice, which I found quite poignant. Do you think this advice applies equally to finance professionals as well? It seems like those who were fortunate enough to get the right name brands on their resumes early on after college (i.e., BB banking, PE, etc.) seem to continue on this smooth trajectory due to the credibility that those earlier firms gave them. In contrast, those who did not get on the right track post-college have a much harder time making it in finance. Have you seen people in the former group implode for various reasons and those from the latter achieve a lot of success in finance despite being late bloomers?

Jan 22, 2016
Mr. Pink Money:

Best Investing Advice: Understand the value add the customer gets from using the product. Economic moats aren't built by companies. They're built by customers feverishly digging to protect something very important to them. This is how I've found many multi-year compounders (I hate that term btw).

This is very interesting, could you kindly elaborate on this point more, preferably as a theory and provide an example?

Thanks, and I wish you good fortunes in your future endeavors.

Jan 19, 2016

Good Luck. Enjoyed all your previous posts on the HF world.

Jan 19, 2016

Congrats man - thanks for all of the time you've spent giving advice on here over the years. Really appreciate it. Best of luck.

Jan 19, 2016

Congrats - reflect on your triumphs and failures, but don't dwell on them. You're in a good place, which is more than I can say for many of my colleagues.

    • 1
Jan 14, 2017

delete

Jan 19, 2016

Best of luck on this next season of life!

Jan 19, 2016

Seems that you're a person who's well aware and in control of what he wants. Congrats and have a good one!

Would also appreciate if you had the time to answer at what @Kenny_Powers_CFA asked.

Cheers

Colourful TV, colourless Life.

Jan 20, 2016

Thank you for your contribution; best of luck brother.
Welcome to the dark side (non buy-side)

Jan 20, 2016

Glad to hear you blasted your way out of there and got away with the diamonds. Congrats.

Jan 20, 2016

best of luck! I just want to say that we truly appreciate all of the wisdom you've shared over the years. If you ever need anything feel free to reach out to me over LinkedIn or e-mail.

Thank you!
Patrick

Jan 20, 2016

how long did you hold investments for..? mind if i PM you..?

alpha currency trader wanna-be

Jan 18, 2016
watersign:

how long did you hold investments for..? mind if i PM you..?

Range: 6 months to 4+ years. Depended on the catalyst and thesis. Most investments are looked at with 2 to 3 year holding periods in mind.

Jan 22, 2016

Best wishes you your move and enjoy it!

Jan 18, 2016

As someone trying to figure out my plans, I'm curious as to what you're going to get up to?

Jan 22, 2016
throw_away123:

As someone trying to figure out my plans, I'm curious as to what you're going to get up to?

Yes, what's next ?

Jan 18, 2016
throw_away123:

As someone trying to figure out my plans, I'm curious as to what you're going to get up to?

Not sure if my plans will help you but I have a simple structure that helped me get where I am. Work on something that:

  1. I love and where the process of getting better sucks.
  2. Will leverage my current strengths and make them stronger.
  3. Will improve the weaknesses/holes in my skills portfolio.
  4. I'm afraid to do but my future self will thank me for trying.
  5. Expands my network of interesting, positive people.
  6. I think is important.
  7. Allows me to pay it forward.

I'm not concerned about failing as long as I do something that follows the above criteria. For those concerned about not being able to break back into HFs if they leave, your analytical skills don't magically disappear when you leave the profession. Frankly, if you're good, people will try to reel you back in.

Jan 25, 2016

Congratulations Mr. Pink, and best of luck and continued success to you.

Metal. Music. Life. www.headofmetal.com

Jan 29, 2016

Good time to get out. Top ticked the market because this year will be BRUTAL.

Feb 5, 2016

Good job - Don't rush into anything for the next few months, but don't be idle either. Pursue new experiences with a purpose, especially the ones that make you uncomfortable. Best of luck!

Feb 21, 2016

best wishes and good luck with the upcoming endeavours.

Sep 25, 2017
Comment

I am NOT in denial!

Sep 27, 2017