Hedge Fund Articles

For the most part, skills needed for employment at the hedge fund sector are similar to those required by major Wall Street firms, brokerage companies, banking and other financial institutions and asset management firms like mutual funds. The relationship between experiences acquired in Wall Street being applied to hedge fund management could best is explained from the examples of the growing numbers of traditional Wall Street money managers switching to Hedge fund management sector.

Many traditional long-only managers at investment banks have switched over to hedge fund management partly due to better pay offered by hedge funds. In addition, hedge fund managers also receive performance fees based on the profit generated by their funds. Mutual fund managers do not get incentive fees, they are strictly paid salary based on the size of their investment management portfolio, and consequently many of these managers continue to seek hedge fund employment opportunities.

What is Required for Hedge Fund Employment

Individuals seeking hedge fund employment must have an understanding of the financial markets, and how it functions. Most hedge fund jobs require relevant knowledge or experience in some aspects of business and or money management. Persons seeking hedge fund employment must in addition understand how hedge funds conduct their business, through the application of their trading strategies. Hedge funds differ from mutual funds solely on their ability to engage in short-selling techniques. For the most part hedge funds operate with limited regulatory oversight; currently the SEC proposed mandatory registration requirements for US based hedge funds.

Hedge fund administrative jobs deals largely with day-to-day administrative functions, including accounting and compliance issues. Most hedge fund jobs require a minimum of a bachelor's degree in business, finance or other related field. Advanced Masters Degrees in such areas as finance, business administration or other related field will obviously look good on your resume. Some Universities now offer hedge fund curriculum, making it possible for new graduates to get their degrees in Hedge Fund Management.

However individuals with significant years of experience working within the financial markets, as well as brokerage institutions and banks will find such experience very useful in securing hedge fund employment even if such persons do not have advanced degrees in finance and business management, or accounting.

The following job advertisement will give you an idea of what a typical hedge fund employment position entails. Notice the minimum qualification requirement as well as the experience needed for such positions.

Below is a typical job description for a hedge Accountant/Administrator.

• Provide oversight and assistance to ensure accurate and timely completion on the monthly financial statements of the Firm and its affiliates. Prepare a quarterly consolidation of the entities.
• Strengthen the Firms' internal policies and procedures involving all of the functional areas, such as incentive fee accounting, mgmt fee billing process, accounts payable, fixed assets, etc.
• Provide oversight on the annual budgeting process. Analyze quarterly budget to actual variances for all companies. Compute free cash flows and develop solutions to manage excess cash.
• Manage corporate relationships with banking institutions and other key service providers, such as auditors and tax preparers. Coordinate efforts for year-end audit and tax return preparation, including 1065 and 1120 filings.
• Provide assistance and oversight to the financial analyst in handling internal queries; managing special projects; and developing the quarterly reporting package which includes analyzing business growth, client profitability, product break-even analysis, expense ratios etc.
• Provide assistance periodically and at year-end to Fund Accounting Team to review financial statements.

Qualifications and skills needed for hedge fund employment [Accounting/Administrator]

• A minimum of 3-5 years business/accounting experience.
• Undergraduate degree in accounting. Candidate should be a Certified Public Accountant.
• Strong skills in Microsoft Excel, Microsoft PowerPoint and Microsoft Word.
• Strong written and oral communications skills.
• Strong organizational skills

Recent graduates are being employed in hedge fund sector in large numbers; such candidates are offered opportunities to gain a practical experience in the field to back up the theoretical skills and knowledge acquired in colleges and universities. Hedge fund management jobs offer these graduates above average salaries and competitive compensation packages. You should explore your chances of joining the fascinating field of hedge funds.

Paul Oranika Editor-in-Chief

Hedgeco.net Email:[email protected]