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Buyside -> Private Wealth Management

I’ve got an offer for a PM role at a PWM firm. I curently work at a hedge fund as an APM. The comp is roughly the same after some negotiating. They don’t expect me to do any of the sales, just the IPS and allocations and some meeting with clients. The firm is tiny ($200M AUM) but I’d be one of two people actually managing money and they’ve given me this whole verbal “you’ll be a partner in a few years and we’re going to kill it, etc.”

I’m considering making the leap for the work-life balance improvement but wondering about your thoughts on one of my biggest worries which is if I make this switch I may never be able to come back into the buyside. What are your thoughts? I have 6 years buyside experience (straight out of school) and fear if I take this risk with this firm, I’m basically in Wealth Management forever. True/False?

A) I can’t stand it when RIAs call themselves PMs. I assume this is what your prospective job is? You wouldn’t be a PM. PMs have products attached to them…

B)ut I digress. Yes, going into wealth management will dampen your buyside opportunities.

C)onversely, if the wealth management firm grows to a multi billion dollar firm and you’re in line to get equity, you could make way more money than many on the buyside.

Sweep the Leg wrote:

A) I can’t stand it when RIAs call themselves PMs. I assume this is what your prospective job is? You wouldn’t be a PM. PMs have products attached to them…

B)ut I digress. Yes, going into wealth management will dampen your buyside opportunities.

C)onversely, if the wealth management firm grows to a multi billion dollar firm and you’re in line to get equity, you could make way more money than many on the buyside.

TBH, not sure what the distinction is here, but I’ll tell you what the role entails and you tell me which one it is?
I’d be responsible for taking chunks/whole HNW inverstor portfolios and allocating them to different asset classes including equity, fixed income, alternatives (PE, HF’s, RE, etc.) I’d be fully responsible for monitoring and rebalancing these portfolios. Effectively allocating these to other managers inside these funds. To me, PM is a fair title for this job as you’re managing a portfolio of assets, just as you are when you’re on the buyside, just that the assets are different.

FWIW, these are also called PM jobs where I live because you need to be registered as a PM to conduct this business.

^That’s an analyst (maybe something even fancier like Director of Research at a bigger shop) for a financial advisory practice. Not close to what an actual PM does. For a $200mm shop, that’s really an assistant to the rainmaker. You’ll be crunching numbers while your boss plays golf with clients.

Doesn’t mean it’s not a good gig with a lot of upside. Just bothers me when advisors get an over-inflated sense of ego. 

Sweep the Leg wrote:

^That’s an analyst (maybe something even fancier like Director of Research at a bigger shop) for a financial advisory practice. Not close to what an actual PM does. For a $200mm shop, that’s really an assistant to the rainmaker. You’ll be crunching numbers while your boss plays golf with clients.

Doesn’t mean it’s not a good gig with a lot of upside. Just bothers me when advisors get an over-inflated sense of ego. 

Not sure it’s something you should be bothered by. I work a traditional PM role at a hedge fund currently and I’d call that role a PM as well because it’s literally in the job description (managing a portfolio of assets). Anyway, this question was more about having difficulty crossing that line the other way if I decide I’m not happy in WM.

imaginethat wrote:

Sweep the Leg wrote:

^That’s an analyst (maybe something even fancier like Director of Research at a bigger shop) for a financial advisory practice. Not close to what an actual PM does. For a $200mm shop, that’s really an assistant to the rainmaker. You’ll be crunching numbers while your boss plays golf with clients.

Doesn’t mean it’s not a good gig with a lot of upside. Just bothers me when advisors get an over-inflated sense of ego. 

Not sure it’s something you should be bothered by. I work a traditional PM role at a hedge fund currently and I’d call that role a PM as well because it’s literally in the job description (managing a portfolio of assets). Anyway, this question was more about having difficulty crossing that line the other way if I decide I’m not happy in WM.

Pretty sure people are bothered by inconsequential stuff all the time. That’s why they’re pet peeves and not actual issues. But, I appreciate your thoughts and considerations. Yes, a PM at a hedge fund has a product to sell. You’re not a PM if you have no composite, aren’t GIPS compliant, and/or don’t have a product listed in one of the major databases. Creating a portfolio of mutual funds and ETFs for private clients is what financial advisors do. There’s no shame in it and good money to be made. But they’re a far cry from what a PM does. Your own title of this post makes that clear. Wealth management (financial advising) isn’t buyside. PMs are. 

Anyway, your question has been answered. Yes, going into financial advising, even as an analyst, will make it tougher to go back to the buyside. And, while it’s just a pet peeve of mine, real PMs really don’t like it when advisors call themselves portfolio managers, so consider that when writing future resumes. 

I have to agree with STL on this one.  Having words in a title that don’t match the function is just title inflation, not a new concept.

Sweep the Leg wrote:

Yes, a PM at a hedge fund has a product to sell. You’re not a PM if you have no composite, aren’t GIPS compliant, and/or don’t have a product listed in one of the major databases.  Creating a portfolio of mutual funds and ETFs for private clients is what financial advisors do.

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