A strong desire to succeed drives many financial professionals to start their own hedge funds. However, during down economic times, getting a start-up off the ground is difficult, and venture capital may be non-existent. Established hedge funds are taking advantage of tough market conditions to scoop up talented individuals who would otherwise be entrepreneurs.
Filling Management Positions
The Wall Street Journal reports that major hedge funds including Marshall Wallace, Millennium Management, BlueCrest Capital Management and CQS are hiring prospective entrepreneurs as managers. Growing firms are seeking out ambitious financial professionals to fill roles as portfolio managers or senior level leaders. Advancing one’s career through a management position is becoming more attractive given the market barriers for entrepreneurs. The average financial size of new hedge funds in 2012 was over $100 million, which is giving new companies pause.
Impact on Employment Prospects
The competitiveness of the hedge fund industry is growing fiercer as the pace of new companies starts to dwindle. Senior positions are being fought over by internal and external applicants who are increasingly more qualified. Though established firms continue to build on their assets and deliver favorable returns, the labor pool is outpacing lucrative job opportunities. Those candidates that are able to distinguish themselves through achievement and entrepreneurial potential are sure to catch the eye of hiring managers.
If one wants to enter the hedge fund industry, they need to have certain characteristics and technical skills. According to Forbes, many firms employ mathematicians and number crunchers that can sift through a large volume of data with a short turnaround time. The ability to withstand high pressure is essential, and having a network of connections greatly enhances job prospects. The 2013 global economy is hindering start-ups, which is making job prospects scarce.
2013 Industry Trends
Deutsche Bank reports that, in July of 2013, the global median hedge fund performance was up to 4.85 percent. The hedge fund industry is watching the U.S. labor market and monetary policy closely, and each variable is weighing heavily on the global economy. German federal elections in September of 2013 will also impact the industry. The markets continue to recover from the financial difficulties of 2008. As recovery continues to gain momentum, job prospects will improve for financial professionals. For now, those interested in starting their own company may be inclined to wait for better economic conditions.
Entrepreneurs exhibit the drive and competitive spirit hedge funds look for in job candidates. Tough market conditions for start-ups are driving potential business owners to look for upward mobility at established firms.