Morning Coffee: Unlikely candidate for the easiest, most prestigious job in finance. Burnt-out MDs encouraged to move on
Anecdotally, working for a hedge fund is not easy. Many hedge funds are nursing losses after betting that Hillary would win. Those that aren't are struggling to justify their existence in a world where ETFs and passively managed funds can generate comparable returns. Every year, hundreds of hedge funds close down. Every year, some hedge fund managers - like the infamous Greg Coffey - figure that a life spent deep in the viscera of the markets is too much like hard work.
In a new article, however, Business Insider suggests working in a hedge fund isn't really that bad after all. Drawing on figures from an Emolument survey, it argues that: 'Hedge fund managers are usually the clients of banks and so are more "flexible in their working arrangements, being in a less pressurised client-driven environment compared to their sell-side counterparts."' Hedge fund managers have the best work-life balance in the finance industry, says BI.
Or do they? As the chart below, from Emolument shows, it's fund managers on the whole rather than hedge fund managers in particular who have the easiest lot in finance according to Emolument. Within the fund management category, we suspect hedge fund managers are worst off. If you want an easy life in finance, work as an ETF portfolio manager. Whatever you do, don't work in M&A/Advisory or origination (ECM), whose horrors the data confirm to be very real.
Separately, Lucy Kellaway, the popular London-based Financial Times columnist, has announced her plan to quit journalism and embark upon a new career in teaching. She's set up, Now Teach, for 'people who dream of starting all over again and doing something new.' Now Teach is currently looking for ex-McKinsey consultants and bankers to teach mainly maths, science and languages in challenging secondary schools in London. No one in banking is likely to jump immediately, but Kellaway's proposition might seem a bit more appealing to washed out MDs once bonuses are paid early in 2017.
Hedge fund managers foolishly trying to hire 'young gods'. (PriceactionLab)
John Cryan, CEO of Deutsche Bank, on the bond markets: “The impact of buying up corporate bonds is that we see, in our bank, bond-trading volumes down something like three-quarters. And there has absolutely been no price discovery now in corporate bonds, so we don’t really know the price of credit, which is a dangerous situation.” (Bloomberg)
Jeremy Browne, Special Representative for the City to the EU: “The question for the EU is: Does it see the City of London as a European asset that it treasures and nurtures and wishes to develop for the wider interests of the people of Europe, or does it see the City of London as innately undermining the narrower interests of the European Union?” (Bloomberg)
Philip Hammond, Chancellor of the Exchequer: "I talked to major banks and financial institutions based in London on a regular basis and of course we provide them with reassurance - reassurance about the fact we will argue very strongly for maximum access for financial services during these negotiations." (Politics Home)
A whistleblowing case concerning Barclays' 2008 cash call is mysteriously being held in a private hearing. (Guardian)
Morgan Stanley wants to hire 800 more people in Baltimore by 2020. (Baltimore Sun)
The key skill in the coming machine economy will be human judgement. (Harvard Business Review)
'From 1983 to 2010 the number of American households worth at least $10 million grew to 350,000 from 66,000. In technical terms, such a situation is known as “elite overproduction.” Elite overproduction generally leads to more intra-elite competition that gradually undermines the spirit of cooperation.' (Evonomics)
Women are better than men at recognizing faces. Unless it happens to the faces of Transformers. (Motherboard)
Mizuho plans to keep hiring in the U.S. in 2017, but can you pronounce its name? (Business Insider)
“There is a joke going around here that if I’d have known how good Trump was going to be for Wall Street, I’d have campaigned for him,” said one Goldman Sachs executive. (Politico)