If you’re a recent graduate working 80 hours a week in an investment banking division for £66k ($81k) a year, you’re doing it wrong. If you got your job after going through investment banks’ convoluted recruitment process, more fool you. There are easier paths. But you’ll need to be exceptionally good with numbers.
For all the complaints that investment banks don’t value their quants, hedge funds seem pretty attuned to their importance. Bloomberg reports that funds are offering top computer science graduates from top schools pay packages of $300k in year one. Hedge funds want top students’ data analysis skills so badly they’re running competitions to attract them: Citadel’s offering a $100k cash prize to the student who wins its “datathon” data championship. It’s held 18 qualifying rounds at universities across the U.S., Britain and Ireland already and there are more to come.
These being computer science rather than finance graduates, however, the money isn’t the big draw. Rarefied data scientists are more interested in the opportunity to work on interesting products in a pseudo-academic environment, where academic-style papers are published and you get to work in teams with other students. Hence Man Group has got the Oxford-Man research unit at Oxford University and hedge fund Two Sigma is starting a partnership with Cornell.
Not everyone can be a top data scientist with a top hedge fund, but those who make it probably won’t have to kill themselves in the style of junior investment bankers. A separate study found that 44% of hedge fund employees work between 40 and 49 hours a week and that 29% work between 50 and 59 hours a week. Hardly anyone works 60 hours plus.
Separately, Financial News has caught up with Bruno Iksil – the man who claims he’s being wrongly accused of generating the $6.2bn loss at J.P. Morgan in 2012. Iksil’s finance career is in tatters, he’s had 80% of the $6m-$7m in compensation he earned each year at J.P. Morgan clawed back, and faces the prospect of an enforcement action from the U.S. Federal Reserve. The latter threat excepted, life doesn’t sound too bad. Since leaving J.P. Morgan, Iksil’s been living outside Paris where we’re told he, “runs, cycles or swims each day. He plays card games with his kids and helps with their homework.”
Why senior bankers want to work in transaction banking: In 2016, banks made $209bn from transaction banking, compared with the $172bn made by their trading arms, and $77bn in M&A. (Financial Times)
The future Deutsche Bank now looks more like HSBC than Credit Suisse or Goldman Sachs (WSJ)
Deutsche Bank has raised more than 20 billion euros in new capital since 2010 but has a market value of only 26 billion euros. (BreakingViews)
People from the markets division are running Deutsche’s new combined investment banking and markets business. (Bloomberg)
Hedge funds are buying bank stocks, especially European bank stocks. (Reuters)
Barclays has got an apprenticeship degree too. (CityAm)
There’s a new investment bank operating out of Mauritus. (International Adviser)
It’s a great time to work in high yield. (Axios)