I'm currently working at a well-known multi-strategy hedge fund. Although my fund is fundamental driven (event driven, merge arb, distressed credit, convert arb etc), I'm doing quant work which covers risk model, pricing, portfolio optimization, macro, performance analysis. In addition, my team is doing a lot of ad-hoc projects for portfolio managers when they want have some quantitative measure or ideas.
My goal was to become a quant PM but 3 years at current fund changed me a lot. I'm not longer a firm believer of EMH and lose interest in signals/time series/statistics. In contrast, I begin to like and pay attention to merge deals, restructuring plan, bankruptcy and stock catalysts, since PM always brief us before big deals coming in as well as closing/exit. While I don't involve in the deal making process, I always enjoy doing some side studies by reading interesting articles/analysis.
I know fundamental hedge funds doing those "fancy" strategies are really hot. Even banker and't guarantee a job there. But if assume I get in one of elite finance school (Wharton/Booth/CBS):
1. Do you think I have chance to break in?
2. If not directly after MBA, how about first doing ? (equity research, high yield research)
3. If not directly after MBA, how about first doing banking? (lev fin, m&a, but I know the quote from WSO that associate is for people who want to have long term banking career)
4. Should I decide a specific strategy in advance (or at least asset class)?
5. How could I use one year before MBA to maximize my chance?
Here is my personal analysis:
- Worked in big name hedge fund and had exposure to real deals. Could "polish" my resume to more fundamental related
- Have one year before MBA to really build investment skills by using company resource (study past deals, ask analysts etc)
- Fast learner (no finance background at all before current job, 1 month GMAT 750, 2 week CFA1, 1 month CFA 2)
- No banking/investing/PE/Operation/Industry experience
- Absolutely no modeling experience (unless CFA counts)
- Not native English speaker (as you can see in writing)
- Fundamental PM may have prejudice toward quant/technology background people
- Asian background. Depends on whether company has plan to expand to Asia. I want to go back to Asia in long run but also want to train in US. I'm fairly well connected in Asia via family (not those super rich or government official tho)
About specific strategies, here are my preference and thinking:
- Distressed Credit
I'm most interested in distressed credit partly because its complexity and hybrid characteristic. I think it really exposes analysts to the REAL business instead of focus on shallow indicator like earnings multiples. It is also one of most inefficient market so long term.
Also, I really think distressed credit has a huge potential in emerging market even though in US credit cycle already passed its peak (or bottom depends on your prospective)
I know it is probably the most difficult area to break in so I'm thinking maybe I can try to work as HY research analyst in big AM house like state street/fidelity, which are pretty standard as post MBA job. Not sure if it is feasible to switch to distressed after HY experience
- Merge Arb
To me, merge arb is probably the most " " like strategy among all even driven/special situation types. It requires more market sense in addition to fundamental analysis. So it could be a fit for me but not sure if I'm their typical recruits
I like its flexibility of expressing views via many different ways. Also I'm pretty /Convertibles. But this is pretty niche market and I doubt many funds hire MBA students for that.
- Event driven/Long Short
I kind of dislike pure fundamental equity strategies due to its popularity and market efficiency. But this is the area that hire most people