Single vs. multi-managers

Hi everyone - would be great to get an update on how one would consider the opportunity at the more traditional L/S managers vs. the larger platforms. The forum has articulated well the pros/cons in the past (e.g. longer horizon and stability and the SMs vs. more transparency of PNL and faster promotion to PM at the MMs), but seems like there has been a shift of talent and capital to the MMs over the past few years. For someone looking to move to the public markets, any updates on those pros and cons and whether the relative attractiveness of career, comp, trajectory has changed between those two?

 
Most Helpful

Single Manager Pros
- More job stability
- Potentially greater salary
- Longer-term investment time horizon, but depends on the firm's/PM's investment style
- Better work / life balance (of course depends on the firm)
- Less stress in general

Single Manager Cons
- Less access to sellside research
- Less pay during good years
- No brand name

Multi-Manager Pros
- Amazing access to research, management teams and conferences
- Well known brand name firm
- High payouts during good years
- Develop good relationships with execs/IR at company's you cover
- Can become a PM / manage a book very quicky if you perform well

Multi-Manager Cons
- Little job security (have a bad year and whole team can get let go)
- Market neutral model (debatable whether a con, but depends on your investment philosphy)
- Investment style becomes very repetitive
- Short term, quarterly investment style
- Very stressful, earnings seasons are brutal

Here are some more resources about multi-managers from my perspective:
- The Basics of Working at a MM HF
- Life at a MM HF

 

End of day people do MM for $ plus control at PM level. At analyst level, probably $ and path to a carveout or book.

The other points a mixed bag... Brand not a blanket advantage for MM in terms of personal reputation building bc 12 different books in your sector all being run differently with diffferent quality process etc. Having been analyst at Citadel/Sac by itself doesn’t say much. And because there are 12 industrials books or whatever being ‘the industrials PM at Citadel’ doesn’t mean something to a company the way being ‘the industrials PM’ at viking does. Having been Plotkin’s analyst at Sac or jack woodruff’s at surveyor does say a lot, but unless working for one of few famous PMs or becoming one, brand of large SM tells you more, good or bad.

Sellside access and management relationships similarly mixed bag. Any resource that is just $, the big MM will index well. But because of team stacking, corporate and analyst access for any given book worse than a big SM. Will bank get your platform some meeting with every company at every conference because you pay so much? 100%. Will it be ‘the Hf meeting’ where it’s all MM guys and your platform has two or three seats (and p72 has 2, and baly has 1, etc) so you have to get notes internally if you don’t have one of two biggest books in sector? Yes.

 

It's hard to have a "style" when you have not practitioned professionaly. You have no clue what the menu of styles are, the asset classes, nor the tools required to pursue a style. Asking a 24 year old kid to determine his style is stupid. Go work for someone you admire that has a good track record. Whether he trades long/short, buy and hold, or whatever, what matters is learning from someone good early in your career. You can then start to adjust and develop your own style.

 

I agree with OP that the multi-managers have become less relatively unattractive as they’ve gained assets, as alt data has grown in importance and as there has been some better talent going there. As someone who’s been at both and recently moved back to single manager, I’d pick single manager every time - the longer time horizon allows me to do deeper research, take bigger bets and I think a generalist model is more attractive and better for my career than the narrow focus required at junior levels at MMs. MMs are probably better products for the their LPs but for an analyst I like SMs and the historical reasons people prefer SMs are still largely true. Most important thing though is to be on a winning team in either model - otherwise you’re gonna have a bad time

 

Et voluptas illum voluptatibus iusto aliquam eveniet ipsam soluta. Fugit et laboriosam consequatur omnis accusantium voluptatem quos id. Laborum nesciunt et eveniet non quas nisi repellendus occaecati. Est numquam voluptatem distinctio excepturi voluptas vel.

Saepe et dolor dolorem a quasi minus exercitationem ad. Aut repudiandae consequuntur sit qui commodi corrupti tempora. Quisquam et doloremque dolorum voluptas.

Career Advancement Opportunities

March 2024 Hedge Fund

  • Point72 98.9%
  • D.E. Shaw 97.9%
  • Magnetar Capital 96.8%
  • Citadel Investment Group 95.8%
  • AQR Capital Management 94.7%

Overall Employee Satisfaction

March 2024 Hedge Fund

  • Magnetar Capital 98.9%
  • D.E. Shaw 97.8%
  • Blackstone Group 96.8%
  • Two Sigma Investments 95.7%
  • Citadel Investment Group 94.6%

Professional Growth Opportunities

March 2024 Hedge Fund

  • AQR Capital Management 99.0%
  • Point72 97.9%
  • D.E. Shaw 96.9%
  • Citadel Investment Group 95.8%
  • Magnetar Capital 94.8%

Total Avg Compensation

March 2024 Hedge Fund

  • Portfolio Manager (9) $1,648
  • Vice President (23) $474
  • Director/MD (12) $423
  • NA (6) $322
  • 3rd+ Year Associate (24) $287
  • Manager (4) $282
  • Engineer/Quant (71) $274
  • 2nd Year Associate (30) $251
  • 1st Year Associate (73) $190
  • Analysts (225) $179
  • Intern/Summer Associate (22) $131
  • Junior Trader (5) $102
  • Intern/Summer Analyst (249) $85
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Betsy Massar's picture
Betsy Massar
99.0
3
Secyh62's picture
Secyh62
99.0
4
BankonBanking's picture
BankonBanking
99.0
5
DrApeman's picture
DrApeman
98.9
6
CompBanker's picture
CompBanker
98.9
7
dosk17's picture
dosk17
98.9
8
GameTheory's picture
GameTheory
98.9
9
kanon's picture
kanon
98.9
10
Jamoldo's picture
Jamoldo
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”