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I've been pretty set in my mind for several months that I was going to apply to business school this fall. I recently had a meeting with an investment professional at a well known value hedge fund and he strongly advised against pursuing an MBA. He said that their firm doesn't assign any value to the MBA. This isn't a super-quant fund looking for Ph.Ds in hard sciences, it's a fundamental research intensive shop.
To give context to our discussion I told him my goal was to learn public securities investing in the short term with the goal of becoming a portfolio manager. This discussion surprised me, and got me wondering if this view is shared by other similar HFs. Any ideas?
No personal experience, but I have a friend who had a PM interested in hiring MBA summer interns. The fund was a spinout from a gigantic one. That said, my friend did not have an MBA and would probably have been thought of as weird if he left to get one.
I think it would help break into hedge funds, but probably doesn't help much for advancing if you're already in the industry. _________________
I've been looking into this a bit also. From what I can tell, some hedge funds care about the MBA and others don't. However, a lot of big mutual fund companies like Fidelity and Capital Group recruit MBAs pretty heavily. If your MBA can land you a job at one of these places, then I think that kind of top flight equity research experience would be pretty valued by a hedge fund (even if your MBA wasn't). Just my thoughts though. No direct evidence to back it up.
Btw, I am looking to get into buyside equity research post MBA. Applying this fall.
I agree with that analysis of hedge funds and MBAs, however, an MBA from Finance centric schools are perhaps and exception to this. An MBA from say Wharton, Columbia, NYU, Chicago, MIT or London Business School, would be useful at a hedge fund. In fact LBS has a full on research center dedicated to HFs - check out the BNP paribas Hedge fund research center at LBS.
I think it would help break into hedge funds, but probably doesn't help much for advancing if you're already in the industry.
I think this is exactly right. I think an MBA will help you break into the HF industry in the following ways:
1) Pass the initial screen. A lot of smaller HF shops literally have nobody in human resources. The PM's will go through the resumes, and they can use the MBA as an initial screen.
2) Alumni connections. I think this industry takes a little bit more networking than others. Setting up informational interviews with alumni is a good way to learn about day-to-day activities and various investment styles. Also, since a lot of HF jobs aren't advertised, it's a good way to learn about job openings. It's not uncommon for an information interview to turn into a job interview.
3) Part-time internships during school. Some smaller shops offer PT internships, where you basically look at a company and give an in-depth report. In a sense, the shop is outsourcing some of their research. Some pay and some don't, but regardless, it's a great way to get your foot in the door.
Obviously you don't need an MBA to work at a HF, especially if you have a great background. But an MBA can certainly be a big help.
Throwing my 2 cents in, I currently work at a macroeconomic hedge fund (approx $9bn AUM). Of the 250 people within the fund, there are 3 with a MBA. The schools represented are Harvard, UChicago and MIT.
As an employee, my perspective is that hedge funds value relevant experience. The higher compensation is due in part because they do not want to waste money and, more importantly, time training someone new to the post.
Keep in mind this is for a macro fund. (Interestingly, the number of former collegiate athletes = 30-ish).
I recently read an article in the nytimes, I think, that touched upon this. The bottom line I got was that getting an MBA is somewhat frowned upon if your pre-MBA work was in financial services. However, it's not if you didn't work in financial svcs previously and are looking for a career switch.
I am not so sure about that. Financial Services is such a big business, you can be miles away from what you want to do while working for the right name. I know my move has worked fine and been seen sensible, and there are a good few others I know who have done similar. It is really something you need to consider on your own case - how much sense does the MBA make? _________________