PWM vs. Hedge Fund
What is the difference between PWM and hedge fund? I understand that multiple investors pool their money into a hedge fund, but isn't that similar to what PWM does?
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PWM offer lots of different services (estate planning, loans, etc) and is designed specifically for a particular person's needs.
if that is the only difference, why is the general feeling that pwm is not as "prestigious" as hedge funds?
Not sure where to start on this one.... The two things are very, very different.
Dude are you doing any research on your own here, quick google searches could answer your question...
PWM at a bank often outsources the actual investment management, either to a bank's internal fund management business (Highbridge at JPM for an example) or to external managers. As an example, several of our investors were referred to us from a small PWM/private banking group that has a long-standing connection with a senior person here. The PWM groups themselves operate as more of a client servicer and asset allocator.
I was interviewing for PWM SA a while back at a top BB (JPM, MS, CS) and I asked the guy straight up what was more important, increasing the value of your current clients' portfolios or getting new clients...he said getting new clients.
Another guy said that PWM was considered to be the "bastard step child" of the firm. This was right after the guy before him said they were considered the quarterback of the firm (I had to hold in the lulz).
PWW sux.
PWM is what you make of it. I know a couple guys that have incomes and lifestyles that nearly anyone on this site would kill for and they work in PWM and come from a nontarget (gasp).
PWM-CFP
HF-CFA
That really covers it all.
so what happypants? there are people in every profession that have sick incomes and lifestyles
Is a summer analyst position within PWM as a softmore a good stepping stone to get into the private equity group within a bank or an outside/internal hedge fund?
For a sophomore it works fine. As far as getting a PE/HF job out of undergrad, that is usually very tough and most people (including myself) would advise you to do banking for a couple years. All in all, a PWM internship is good for a sophomore, but you should be looking for i-banking internships during the school year so you can land a SA gig at a BB once junior year (January/Feb) recruiting rolls around.
As a sophomore it will give you the experience and confidence to hopefully apply the following year for a SA in IB, or other internships that will get you closer to your goal (whatever that may be). Just be patient, build some skills and realize that your goal may not be something that is easily attainable as an undergrad. With the correct skills and experience built up it can be attainable in a few years out of undergrad though
well the best at any field are always gonna be making good money, but compare like to like, and the avg dude at a hf makes more than the avg dude at pwm and is likely smarter than the avg pwm guy(I should say chick tbh), which is why it gets its bad rep.
If you wanna mention the sick pwm guys then benchmark them againt soros, rogers, buffet etc... they don't hold up to well there.
Buffet's a hedge fund manager?
holy bump Batman. you have Google to know what Warren Buffett does, but the short answer is no.
Yeah, but the sample sizes are completely different. The "average guy" in a HF is one of far fewer than the "average guy" at a PWM shop.
I would also argue that the barriers to entry for PWM are so much more manageable than the ones to a HF. The guy I was referencing previously went to a school that I have never heard of before or since, had nothing special to bring to the table but was able to sell himself to a fair number of HNWIs early on and, after doing well for them, got good reviews with their friends and colleagues.
You can't really compare anyone to Soros and that ilk, I agree but as far as rationale expectations and goals, PWM doesn't always deserve the rap that it gets.
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