SS ER > MBA > LO
Hey everyone,
I currently work in sellside equity research at a BB. My goal is to work at a long only fund, and I plan to pursue an MBA since analyst roles tend to be post-MBA positions. I would matriculate with 4 yoe. While it is common for people in my position to avoid an MBA and exit to MM HFs, it isn't a path I'm particularly interested in.
While I understand it's extremely difficult to land at a top long only regardless of background, I was wondering how much more difficult it would be without buyside experience. Assume I managed to get into HBS/Wharton/Columbia. The firms I have in mind are First Eagle/Harris Associates/MFS/Capital Group.
Easier way to say this is: Likely when / if you get into H/S/W or CBS / Booth, you will compete with people who worked at Trowe / Fidelity / Capital Group pre-MBA for the spots you want to have. Your goal is totally reasonable, as long as you are laser-focused on checking all the boxes (stock competition, student fund, taking classes from hedge fund adjuncts, etc.) and wow them with your thinking / stock pitch.
If you get into CBS, needless to say, your second battle will be to get into the value investing program, opening up a whole secret club of funds that align with your philosophy.
That's really helpful, thank you.
Another thing I'm wondering - if someone were to get a much higher scholarshop from CBS vs. HBS, is there a case to be made for taking CBS?
This assumes I'm fortunate enough to even get into these programs, but in general the RC at HBS isn't too appealing (vs. exempting out of basic CBS courses and taking electives), being in NYC means I could intern at a fund during the semester, and CBS seems to have great (sometimes seemingly exclusive) presence at certain long only funds. Is there a case to be made, or is the Harvard brand too strong to pass up here?
You can't go wrong with either, but I personally pick CBS because I am a value investor.
Even if you don't get into value investing program, you can still take a lot of the value investing courses, which are not taught anywhere else in this country. Another underrated factor of a city school like CBS and HBS, but NYC is still a more finance town than Boston, is you get access to a lot of adjuncts who are full-time money managers but like to teach and source candidates in their classes (some name dropping: Joel Greenblatt teaches there, and John Griffin used to teach there and would hire the top performing student to work at Blue Ridge).
At the end, it's your call depends on where you get in. Also, I would start developing investing mindset now, don't wait for MBA to start. MBA starts in August and recruiting begins in October/November, even with your background in SS ER, can get a head start ingraining yourself with a long-term investor mindset, putting you ahead of majority of your competitions.
Any advice on developing an investing mindset? I've started a PA, follow the markets, prepare stock pitches (mostly for interview prep but I generally enjoy the process), read commentary from investors (Ruane, Cunniff & Goldfarb, Oakmark Funds), read the commonly recommended value investing books.
Does anything stand out in particular that I'm missing? I plan to apply for an MBA next year, so still a decent amount of time to work on this.
What you mentioned are all great activities, you should keep doing that.
One missing thing that you should put a huge emphasis on is to actually do a lot of fundamental analysis. Sell-side experience helps but spends too much time on too many things without focusing on key drivers. Long-term oriented investors want to ascertain the unit economics of the business, what's the industry value chain (who captures most of the gross margin), how does the business generate revenue, etc. Esp with places like Oakmark / Sequoia Fund, you will be a generalist, you should develop (if you are passionate about generalist) a general sense of the KPIs of all businesses so over time you'd understand what's a deserved sell off of a name versus an irrational sell-off which creates a buying opportunity.
Would international students at say CBS with sell side ER experience have a shot?
Yes, but your opportunity set will be more limited to the big brands - Fidelity, Trowe, Wellington, Putnam, MFS, Loomis, etc. Getting sponsored at a hedge fund I presume is an uphill battle, but I don't know any better.
Well, also election is coming up so you never know. Bottom line: I know nothing now.
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