BB lev fin analyst looking to move to HF
I am 1st/2nd year analyst at a lev fin group in a mid-tier BB...if I am interested in transitioning to HF, what kind of fund would I be most suitable for?
I help structure a lot of leveraged loan and HY bond offerings for companies/sponsors (refi, LBO, etc). I do a lot of cash flow modeling and read CA/indentures.
Little about me:
I don't know a thing about equity. I am obviously quite familiar with credit stuff though.
I went to a top 5 engineering school and got my engineering degree there but decided to do banking.
What kind of funds should I be looking at? Also, what kind of salary should I expect? Do I have a chance to get into a mega HF?
Thanks guys.
distressed debt & special situations type funds are the ones who typically recruit people from a lev fin background.
CLO managers, MM debt firms, and mezz shops would certainly consider lev fin as well-the people at the fund I work for (which does what I mentioned plus some distressed) who have banking experience are pretty much evenly split credit trading, restructuring, and lev fin.
You're definitely going to have the best luck with credit funds. The large majority of post-banking hires at the huge "one-stop shop" debt funds are ex-lev fin or restructuring (oaktree, apollo, ares, goldentree, gso/blackstone, sankaty/bain, kkr, oak hill, etc), though those guys have a pretty standardized process and recruit around the same time the megafund pe shops (ie this past march for 1st years) so might be a bit late for that .
The big distressed-focused players also have a bit of a lev fin bias, as do smaller mezz and leveraged debt shops.
The big debt funds pay very competitively, ie all the ones i listed to the extent I know are six figure base with competitive bonus for post-banking associates. Smaller places you should definitely expect a pay cut from banking, though hours are substantially better than banking as well.
Fundamental equity is possible out of lev fin, but you have to do some work there outside of your job to get up to speed on the equity side of things or else you stand no chance in the interviews. It doesn't sound like you've done that, so your odds probably aren't too great on that side of things.
i have no idea what a "mega hf" is, so won't comment on your chances there.
Hey Kenny,
Is comp at a fund like yours similar to a traditional PE fund, pre-mba?
Probably lower on average, but good hours/lifestyle-I work at a smaller fund so it's more of an analog to MM PE where both culture and comp is more varied/lots of dependence on fund performance.
Kenny,
mind telling us what your hours are like?
I was going to create a thread about event-driven investing but that seems unnecessary now that we have this thread. Any thoughts on the best banking groups if I know I want to transition into that (aside from restructuring/lev fin).
Thanks, man.
I get in around 8:00-8:30 most days (sometimes earlier if there's a conference or earnings call, rarely later) and I'm usually in the office till 6:30-8:00 (sometimes later if there's a fire drill going on, for example we have a restructuring going on). I'm rarely in on the weekends unless there's a meltdown; however about 1/3rd of my work isn't super time-sensitive and I can defer it till the next day or the weekend if I need to get out of the office at a given time. All-in I'm pretty happy with my quality of work/amount of work/compensation balance.
We do stuff across the debt capital structure and from broadly-syndicated debt to lower-MM companies, plus synthetics and structured products, so there's a lot of variability depending on the composition of the portfolio at any given time. Dealing with a performing loan that's syndicated to a bunch of institutional investors with a large bank as the agent is very different than working through a default with a sub-50mm EBITDA company with a handful of lenders across the capital structure, so the amount of time we spend on each portfolio company varies a lot.
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