Why do hedge funds suddenly want to hire private equity professionals?
It used to be like coffee and tea, or Marmite and jam - you were either a hedge fund person or a private equity person. You weren't both, unless you were some kind of aberration. Now, however, the HF/PE demarcation has been blurred: one super-senior headhunter in London informs us that two of his hedge fund clients are trying to poach from private equity funds.
"It might not be a new trend, but it is historically unusual and there are two instances of it," he discloses, speaking entirely off the record. "These are hedge funds which are looking for equity portfolio managers and analysts to invest in publicly listed equities. However, they have a more private equity-style of investing."
What is a 'private equity style of investing'? "My clients are taking very large stakes in publicly listed companies and are planning to hold them for a long period of time," the headhunter says. "They need people with a private equity skill-set - who can tear a company apart and really get to grips with what's going on under the bonnet before they invest."
This sounds like good news for private equity professionals, who now have two popular buy-side careers to choose from. It's bad news, though, for equities traders from banks, who've slipped off the hiring radar as far as hedge funds are concerned: "Hedge funds aren't really interested in hiring from banks," says the headhunter. "They'd much rather hire from each other - or private equity."