With the markets at a standstill again for the first time since 2010, hedge funds are giving traders the boot at unprecedented rates. The same environment that gives stability to the world of commercial banking causes hiring freezes and layoffs in the world of hedge funds.
Traders have an especially difficult problem finding new employment because of their unique situation. Their skill set is very unique and only do it in particular situations. Hedge fund traders cannot move into commercial banking; they are simply two different worlds. It is also a game of politics as well. If a hedge fund trader has been traded over too many funds too many times, then a new employer will look at him as a deserter and not give him a chance, no matter how good his record may be.
It is also quite difficult for trader to obtain any type of employment if he does not fit the specific profile. Hedge fund managers are looking for the perfect mix of aggression and experience, and they discern this perfect mix to be between the ages of 25 and 35. Any trader that is outside of this age range may have a tough time breaking in. Also, it is difficult to get a job in a hedge fund if you do not have an Ivy League education with millions of dollars managed under your belt. If you are lucky enough to get a job the first time and you are fired, it is very likely that you may have to move on.
Is there any hope for hedge fund consulting?
There is, however, hope for people who are looking for employment in the hedge fund market in a sideways economy. The same technology that is used for quant trading has been put to use for employment as well. Traders who love to set their prices, limits and signals and let computers do the work will be very familiar with this new technology.
Hedge Fund Consulting for Employment
Instead of stocks that are being put into an algorithm, hedge fund resumes are now receiving that treatment. There are now head hunting algorithms that help to match up traders who have been displaced with open positions in the market. For a hefty fee, a trader can now place his or her resume into this algorithm and simply wait for the results. As soon as hedge funds catch on to this as a more effective way to find the next trader, it is likely that the environment for hiring will change in the world of high finance.
This is certainly a new type of hedge fund consulting – one that actually helps people directly instead of focusing on the tools of the trade. There have already been some major hedge fund consulting firms who have bought into the technology, using it to find their most recent round of new hires. Could this be the wave of the hedge fund consulting future? Only time will tell, but the environment is certainly set for a change.Using Algorithms for Employment by Carlos Danger