Private equity is fast-becoming the destination of choice for anyone wanting to work in the financial sector. More people apply for jobs on the buy-side than anywhere else, junior investment bankers are jostling for places and now its appeal has increased for MBAs.
The number of MBAs listing private equity as their career choice has increased by 6% this year, according to analysis by Training the Street cited in Bloomberg. Despite the job cuts and diminished recruitment of MBAs, the appeal of large investment banks has also increased – both boutiques and bulge brackets – and MBAs are also keen on working for a start-up, it says.
Hedge funds, however, are now considered too much of a risky bet for MBAs carrying huge amounts of student debt. Private equity firms – by contrast – rarely fire people and are considered a safe option.
This chimes with this year’s London Business School MBA employment report – for the first time ever the same number of students from the school ended up in private equity as investment banking – despite the fact that PE offered £5k ($7.3k) less on average. Over time, of course, private equity can be much more lucrative. Pay can increase rapidly after a few years, particularly when carried interest comes into play.
Separately, mid-sized investment bank Jefferies always reports its quarterly results slightly before its larger U.S rivals and is therefore viewed as something of a bellwether for the industry.
If this is the case there’s reason for (some) optimism. Its fixed income business, which typically focuses on high yield bonds, was up sharply year on year and QoQ to $238.5m, equities were also up and investment banking revenues improved on a relative dismal first quarter.
Is it getting better? Not really. “You can’t say it’s all clear and the worst is over, but you can say there’s more stability and more natural client flow,” CEO Richard Handler told Bloomberg.
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Sanjay Valvani, the hedge fund manager accused of a $32m insider trading scheme, has been found dead in an apparent suicide (NY Post)
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