Sunday, March 30, 2008

Buy side/sell side joke

Passed on to me by a friend on the buy-side (if an investment banker ever asks you to tell him a joke in the job interview, this may a a great one for him ;-))) ):

"What is the difference between a buy-side and a sell-side trader?"
"One says "f*** you" and hangs up the phone - the other hangs up the phone and then says "f*** u"

hehehe :-).


Vik said...

Hi Angie,

Great blog! I came across it recently and found your posts very informative. Given what I read about your interships and professional goals, I am hoping you can answer a couple of my questions on LBS.

I currently work as an analyst at a hedge fund in New York and my post-MBA goal is to work at a hedge fund in London.

I am debating admissions offers from LBS, Columbia, and Chicago and am leaning towards LBS as it feels like the right fit. Hopefully, I am also able to get a scholarship from LBS to help with the costs of London!

But, before I make my final decision, I am trying to do additional research on hedge fund career opportunities after LBS. In particular, I was hoping you could give me some insight into the success of LBS students at getting jobs at hedge funds in London, whether LBS has a network of alumni working in the hedge fund industry, and any thoughts you might have on LBS’ reputation among the London hedge fund community.

Thanks for your help! By the way, the joke you just posted was pretty funny. : )

angie said...

Hi Vik, good question. I will be honest with you. It's great that you work as a HF analyst in NY already, so probably you wouldn't have a big problem switching anyway. I wonder why you don't go for a Masters in Finance program instead, which is only 1 year, cheaper and more relevant, while in the MBA in the first year you will do a lot of things you may not find useful. The key advantage of the MBA over the MiF for me was the internship, which is useful for a career changer, but I'm not sure if you would need an internship given your background, also it is not very common for hedge funds to take interns, they always prefer to hire full-time.

Now regarding school choice: it is only in the last 5-10 years probably that LBS attracts very good people for finance career (it used to be much more focused on training future managers in UK companies), so while you have a lot of alumni in investment banks (those who graduated in the last 5 years or so), I find the community of hedge fund alumni is quite small. If you look for only those working at the top hedge funds, I think the number would really only be 20 - 30 people. Because of this, hardly any hedge funds come on campus (as they do in Harvard and Wharton as far as I know), and you have to be proactive about it.

That said, the London Business School name is strong now and there are quite a few classmates who come from hedge funds or are going into hedge funds, but there is also a few more like me who had hedge fund offers but opted for investment banking offers for now to gain more general sell-side experience.

I only know that compared to Harvard or Wharton, LBS is definitely not as strong in hedge fund alumni and campus recruiting for HF. I don't know at all if Chicago or Columbia would be better. There are always people at hedge funds there I guess because there are zillions of hedge funds in the US, but the question really is how many go to Citadel, DE Shaw, Renaissance Capital, Eton Park, etc., so I don't know that for your schools.

The last point is the London issue, so this of course would be a great advantage of LBS, especially if you are not European/don't speak a European language apart from English. If you only speak English, then I think it would be very difficult for you to get a HF job in London appplying from the US, since you most likely wouldn't have an edge over any European business school student or London investment banker they might interview. So it would definitely be much easier from London, in terms of networking, interviewing etc.

So that's all I can say, check if you really need a 2-year MBA, given that you don't want to change careers, and then check if going to London is the most important to you - if you are American opportunities in New York may be better for you. Once you know that, I think choosing schools will come down to location mainly. I would think Chicago would provide you with the best finance education in the first year (because it is more flexible, while LBS you really do a lot of finance more in the 2nd year), which is important for interviews and internships, but LBS will make it much easier to find a job in London, and Columbia will be good for NY. Wish you good luck with your decision!

Vik said...

Hi Angie,

Thanks for the quick and thorough response!

I applied to the MBA rather than the MiF as I have a CFA and so I didn't think I would get much out of the MiF coursework. In fact, I am very interested in taking courses in Entrepreneurship, Organisational Behavior, Strategy, and International Managment. I think taking a few courses in these areas, in addition to courses in Finance, will help improve my investment skills as my investment style is fundamental value investing, where understanding the company, industry, and management team is as important as the valuation / financial aspects. Additionally, over the long term I want to start my own hedge fund one day so courses in Entrepreneurship and Leadership should be useful.

One more question for you - given the small number of LBS alumni in the hedge fund industry and the need to be proactive to find jobs in the field, what methods did you and your classmates use to source either full-time offers or internships.

Thanks again!

angie said...

Hi vik,

there are different sources:

- the CV book and investment management club CV book - though they usually don't recruit on campus, lots of them do go through the CVs and contact students with interesting profiles directly

- speaker events at the school. sometimes speakers from hedge funds come on campus and people network

- finance professors, who usually have very good contacts due to their friends from PhD programs who work in hedge funds now. if the professor likes you, he may recommend you to his friends

- proactive applications - at least the bigger funds like Citadel, DE Shaw etc. do have online application systems

- plus the alumni network, though small it does exist, and also personal contacts