Transitioning to buy-side from sell-side
Looking for some perspectives on moving from sell-side to buy-side.
Some background:
Worked as equity strategist (director level making mid six-figures) for two years at independent equity research boutique in NYC (highly profitable and recognized for equity strategy and quantitative research). Published portfolio strategy + quantitative research and also marketed to institutional clients. Prior to that worked as research associate at same firm for six years. That's been my career after graduating full-time MBA program at top five school, so all-in-all eight years of financial services experience. Prior to that I was an engineer for five years after graduating from top-10 public U.S. university with BSc in engineering. I don't have CFA but should get CAIA this September.
As strategist I loved the research but got fed up with the grind from publishing and marketing. I yearned to do serious research and actually put capital to work. So I quit strategist job about a year ago (two years into the job) to start an investment business trading futures for private gain (couldn't trade stocks due to wife working in investment banking). So over the course of the last year the P/L has been up and down and ultimately not looking like viable way to make a living; also wife and I want to have a family in the next year or so. So now I'm looking to get back to the grind but targeting buy-side (don't want to go back to sell-side). I'm targeting equity strategist/investment strategist roles at long-only fund, pension fund, family office, SWF, hedge fund, private wealth, etc.
My questions/concerns:
Do I commit more time to reaching out to headhunters or should I target the companies directly (employees, HR, alums)? I'm already having a hard time getting headhunters to follow-up. How should I approach the job search here?
As I mentioned I don't have CFA. How much does this hurt me? I should have CAIA this September, although I feel like CAIA doesn't quite stack up to CFA from a reputational standpoint.
Was opening an investment business a negative in the eyes of potential employer? I've actually learned a lot and even have a better pulse on the market than I did as a strategist. Should I highlight this experience over that of working as strategist?
I rose through the ranks at my old firm somewhat fast (director level after six years) but my cumulative financial services experience is only about eight years. I'm a bit worried that's not enough for most director-level positions (in terms of looking to make similar compensation I was making before). I'm also worried that having worked at independent firm as opposed to bulge bracket will hurt me. Are these legit concerns?
Thanks everyone! I can provide additional details if necessary, of course.
My perspective as somebody with a similar level of experience (so YMMV):
General commentary: needless to say the hiring market is poor right now due to COVID, the market sell off, and ongoing structural pressure on the industry. There is also an exodus of people from the sell-side (both voluntary and otherwise) which creates a lot of competition.
You should have a pretty extensive contact list from your former SS job, have you reached out to clients you knew from that? I would say that's your best bet to land something.
I would reach out to both headhunters. Given your experience, the more respected headhunters should return your emails and provide advice. The mediocre/crappy ones (which are the vast majority) probably won't return your email though.
CFA: don't think it makes much difference given your level of experience, more a differentiator for junior hires. Realistically it would take you 2 years to complete it anyways, so not helpful in your current situation.
Is opening your own fund a negative? Not necessarily, it has pros/cons. The biggest con is firms might wonder if you will jump ship again if you get bored, frustrated, whatever.
Director level position: I think your experience qualifies you for one if it's a like-for-like hire (i.e. somebody looking to hire a director-level strategist). If the role is not LfL, i.e. they're hiring a research analyst, then you are likely to take a step back in terms of title and compensation. Not the end of the world though.
Thanks! That was very helpful.
In order -
I would start targeting firms or asset owners you are interested in, and start networking directly with them. Alumni is always a great start - also pound the pavement of your former contacts (as others have mentioned) which should expand the pool. The big part of this is crafting the 'back in the game' speech, so to speak. Illustrate you still have relevant ideas - have kept up with things - and that you took advantage of your opportunity to do something different and interesting.
With your experience, and an MBA in hand + CAIA, you should be OK to pass the CFA sniff test. Your worst case is probably a firm saying that you should pursue it once you are in or a strategist role that errs on the side of 'marketing' vs. strategy or churning out research.
I would not highlight it over top of it, but simply be prepared to prove out how it will make you a better investment professional.
You should really focus on tailoring your experience, knowledge base and prior life to whomever you are talking to as well as really dial in on what you are trying to do and/or accomplish. If I were to be critical of your CV as I know it - there's some potential of 'skittishness' as you jump from engineering, to rising fast in a strategist role... to trading futures... clearly you are someone who is very bright, looking for challenges and/or things that keep you interested. It's going to come down to what you want, the opportunity set for growth and the needs of the asset owners. At smaller owners - you may end up being way more involved in a variety of things vs. larger ones with more structured roles. Something to consider.
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