A survey published by Rothstein Kass, a leading professional advisory firm servicing the alternative investment community, finds nearly half (48 percent) of the 400 Hedge Fund Managers polled believe this will be a difficult year, with four in ten (40 percent) predicting the U.S. could enter a double-dip recession.
At the same time, hiring in the hedge fund sector is on the rise, especially for marketing, customer service and compliance officers in light of regulatory developments, the need for greater transparency and enhanced reporting requirements.
Uptick in hiring
“We’ve see quite an uptick in hiring in the past eight weeks,” said Bob Olman, President and CEO of Alpha Search Advisory Partners, an executive search and advisor firm focused on alternative investments, primarily hedge funds, who adds there’s a push for the big to get bigger.
Much of this is due to the fact that over the past few years, the hedge fund industry has become institutionalized as firms invested in their infrastructure to deal with the increased scrutiny being imposed by new legislation.
Two guys and a Bloomberg
“Years ago, a hedge fund meant two guys and a Bloomberg,” explained Olman in an interview with eFinancialCareers. “With the regulatory changes, it’s nothing like that any more. You have compliance officers and accounting officers and businesses have grown exponentially on a human capital perspective, on a technological perspective, as well as on an operational, marketing and customer service perspective. We see all that continuing.”
As for those areas in which hedge funds are hiring besides compliance, marketing, investor relations and client services seem to be receiving significant attention.
“There has been an enormous push from investor due diligence for transparency of assets in the portfolio, in the exposure and in the investment process that has resulted in hedge fund marketing departments to double in size,” notes Olman. “But as they have increased hiring, they have also raised the bar in terms of what they require in the talent they are considering.”
New position of Product Specialist
For example, for the relatively new position of Product Specialist or Manager, firms are requiring you to be a subject matter expert in the investment strategy that the firm deploys, such as an asset class manager. You need to be able to answer deep granular questions regarding investments in the portfolio, the investment process, how they apply and how to mitigate risk.
“This role did not exist two years ago,” said Olman. “Back then you had marketers who were sales people. Some may have been a little more proficient in their investment chops than others, but for the most part they were marketers, road warriors. You had investor relations to respond to investor inquiries and provide the monthly reports. If any investor had a detailed question regarding the fund, the portfolio manager would have to answer it. Today, firms want them to focus on managing the portfolio, producing performance and generating alpha. The Product Specialist will deal with the investors and clients.”
Looking into the analyst pool
Olman says that in order to find candidates for this role, they’re looking into the analyst pool and putting them in the marketing and investor relations teams as Product Managers.
"This is a new development that has seen a steep growth,” adds Olman, increasing from one in 60 firms to one in 20. “It offers an opportunity for investment professionals who have communication skills, who like to face off with clients, a new place to be.”