How to become a PM at a Hedge Fund
Hello monkeys, I am a student at the University of Minnesota. I am trying to decide weather I should major in finance or econ to eventually work at a HF. I know its a non target but I want to know on the best way to get into a HF. First what do you think I should major in? Econ is what im leaning towards since theres a lot more math but do you think I should pick up a math minor? Another question I have is what do you think is the best way to get into a HF? I believe trying to get into AM firm is my best route to lateral in.
Thank you so much!
Bump
If I did have to add on my little knowledge would be equity research is also a good path to HF. With doing econ you won’t have the knowledge on financial reporting like finance majors. It all depends on what type of strategy of fund you want to join. Such as L/S finance major macro econ but both can work. You can never get to much math experience. Pick up what you can such as stats and calc to get comfortable. I never worked in a HF but from reading others this seems to be what I gathered.
HF and buyside world is quite diverse. Deciding on wanting to be a PM (but without any specificity as to what type of investing) this early is fine… but I would spend more time truly understanding the actual type of work and analysis that goes into the different investment roles as what skills you need is highly dependent on the strategy and that will dictate what path makes the most sense. Generally, I believe you can’t truly know what you want to do without first having any experience or knowledge of what the work is actually like, but its ok to start off with that general ambition and learn as you go.
Not to be annoying but people have asked these questions many times before, and there are tons more basic resources / websites that already cover this.
To be basic: anything fundamental you are best serviced by IB (and potentially PE as well for a lot of larger funds) with ER being a good option as well. Global macro is getting more quanty these days, but S&T on the right desks fits that path. And then quant path best served by those with more knowledge. Also straight into top LOs can be a fruitful career in itself or sometimes feed into HFs. Credit has its own paths as well- sometimes restructuring roles- but everything is nuanced the more niche you go. Econ is sort of a useless degree for these roles (coming from an Econ major here). Focus on knowing corporate finance really well as that is the language of fundamental research and it’s like trying to do math without knowing numbers if you don’t know it. Quant people can give their path in other threads.
Spend more time researching- not that you maybe haven’t already, but it’s a lot more nuanced than I can cover here. Most of your basic questions will already be answered in other threads with a little research, and once you understand the true work on a day to day basis at these firms, it will give a clearer understanding of why these paths exist and what skills you need to pick up to do the job properly. Outside of a handful of firms, HFs will not train you the basics, which is why the first 1-2 jobs set you up well and why HFs hire from those places.
Econ will defo help you UNDERSTAND things (for your own personal benefit) more quant-like than the average finance or accounting major, but the difference in math ability is inconsequential and laughable in the eyes of the real math guys. And that makes the difference also inconsequential from a recruiting standpoint, i.e., global macro or quant firms won't jump at you over a finance major because you 'know more math', because we are statistically insignificant and we're all only primed for fundamental analysis at the end of the day. We're tarred with the same brush, and recruiters don't care what people in our bucket (econ, finance, history etc) study because it's not skilled or technical anyway
Do keep that in mind
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