Ross Minor with Engineering (IOE)?

bearcats
Tue, 27 May 2014 09:07:56 +0000

@thestudmuffin‌ I disagree with you on certain topics

“If you don’t come in to investment banking as an analyst (i.e. right out of college), then you realistically don’t have a great chance at working for a reputable hedge fund. This is a massive generalization and there are tons of exceptions which I could get into, but HFs recruit top analysts out of top banking programs. If you come into banking as an associate (which you would do after you got an MBA), then your chances of exiting to hedge funds are incredibly limited.”

I don’t understand why students think that the hedge fund world only consist of long/short equity and event driven, when they are only a small part of the hedge fund universe. I am guessing that’s because that’s the most publicized areas of the hedge fund universe, given that they are things that the general mass can understand. These are spaces that as you said, hire only out of IBD (actually that’s not even true, these spaces also hire out of sell side research and long only research).

The way I see it, background hired from for each space (in order of likelihood)
Long/short equity - IBD, Research
Event Driven - IBD (mostly M&A)
Fundamental Credit - Research/IBD
Quantitative Credit - Trading, Research
Convertible Arbitrage - Trading
Structured Credit - Trading/Research
Volatility Arbitrage - Trading, Quant Research
Statistical Arbitrage - Quant Research, random Phd programs
Fixed Income/Global Macro - Trading, Research
High Level Portfolio Analysis/Quant Research/Risk/Portfolio Construction - Math/Stats/Engineers out of school

“I’m not sure why this is spouted so much here. Engineering degrees will get you jobs within Engineering, while a BBA job will get you a job in marketing/consulting/finance/accounting. Sorry to say, but you’re not going to be recruited for banking jobs out of Engineering. There’s literally no incentive for an investment banking firm to hire an engineer who likely has a lower GPA and no finance background when they can hire a 3.8 Ross BBA who has the requisite knowledge to hit the ground running. It’s not that the background is hard to possess or IB is inherently difficult (quite the opposite actually), but 99/100 times the firm will choose the person with the business background.”

If your universe of high finance only includes investment banking, then what you say is true. However, investment banking isn’t even the best finance job you can get out of undergrad. In trading recruiting, engineering holds its own. Almost every BB trading arm that recruits Ross stays a second day and recruit engineering the next day. Their quant arms would exclusively interview engineering and not Ross. The top Chicago market making firms (DRW, CTC, Optiver, Getco) exclusively recruits at engineering and wouldn’t sniff Ross. The high frequency shops obviously only recruit CS majors. Long onlys and hedge funds recruit for their quantitative needs out of COE. These are all jobs that pay similar if not higher (high frequency can pay up to half a mil to a mil couple years out back in the hay days if you make it) than IBD out of school where you work a lot less hours. The trade off is obviously you don’t get the career flexibility afterwards. But point is, unless you are deadset on investment banking and corporate finance type of jobs within finance, I don’t think it’s much of a trade off, if at all, to do engineering instead. For me back then, I knew was more interested in the markets than the boring transactional stuff. Recruiting was fine out of COE. I had interviews at almost every BB for trading/quant research, every notable Chicago trading firm, and a few long onlys (blackrock, fidelity, capital group) and converted a fair number into offers. Btw I also did 3 investment banking interviews (the ones that had drops at the general LSA site) and got tacked onto their Ross interview schedule…even converted the RBS one into offer.

As I said, I agree with you that if banking is your goal, absolutely go to Ross. But I think when people say opportunities or versatility, they are referring to the range of possibilities.