If you want to work for a hedge fund, you'll need to do your time in banking. Yes, some hedge funds (Man Group, Bridgewater, Winton Capital Management) train juniors straight out of college, but most still pick them out of investment banks’ analyst programs.
Except, that is, Point72 Asset Management. The hedge fund, which is – strictly speaking – an 850-person strong family office now that it simply manages Steve Cohen’s own assets and doesn’t accept anything from external investors, started its own training academy in August.
Eight weeks into the 12-15 month-long course, Business Insider took a look around.
Among the trainees, it found Brian Mulvihill. Brian previously spent a year as an analyst on the industrials team at UBS. He tells BI that the training program at Point72 is more interesting, less gruelling, and more focused than the training program in an investment bank.
He wanted to move into to the buy-side anyway, so why bother waiting to apply to Point72?
Mulvihill adds that you’re encouraged to have your own opinions at the fund, whereas in banks it's more about the consensus. And the lifestyle there is ‘better’ – even though you spend weekends cramming for exams.
There are a few downsides. Only 12 of 400 applicants to Point 72’s program were accepted. There's no guarantee you'll actually get a job at Point72 when the Academy's over. And in a throwback to the micro-climate at SAC Capital, they don’t turn the heating up - preferring to keep students cold and awake.
Separately, senior bankers with relationship responsibilities should take note of KCG's memo dismissing four of its most senior staff in Europe. It is, "not efficient to have multiple senior coverage people speaking to a client every day" as it "often detracts from the overall client experience", writes Phil Allison, CEO of KCG Europe. The implication seems to be that the firm's relationship managers have been overdoing it. Instead of specialist salespeople, Allison suggests the firm will have one point of contact in future: "by selling the entire firm we can create more interesting and higher value roles, and deepen client relationships".
Two Hats At Morgan Stanley (Bloomberg)
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Why leveraged ETFs are an inherently risky strategy that is more akin to “gambling than investing.”
The middle classes have a secret bias towards the rich.
Quote of the Day:
“We had to channel the wall, put plaster in, run the tank through the plaster, and then refinish the wall,” investment banker who has build up an impressive art collection explains the plastic army tank above his bedroom door.