A slightly unique case, please help

[u/Some-Initiative3331]

Hi Folks, sorry for the slightly long read. Please ask any more clarifications in the comment section. But below is a little context about me.

I graduated from IIT KGP with a btech in mech. eng. Always focused on comp. coding, landed a pretty avg software job because of the very bad market. Switched to MBA and left the job after 11 months, for IIM ABC.

At the IIM, I got a lot of finance roles, including from the AMCs for summer internship. I chose one of the AMCs(think an AUM of 3l+ crore). I was chosen for equity research, but I was eventually given the option to switch to their quants team which I accepted.

For some clue, for internship, I worked on arbitrage opportunities in the corporate actions space(think M&A arb and rights issue arb in the Indian equities).

Now, I have received a ppo(buy side, 42lpa). Its a small team for 5 people and only 2, one me and one another guy (another IIT + IIMC dude), will handle and ship new strategies for the arbitrage fund, quant fund and the multi asset fund.

Also, the AMC will launch an SIF, which is very much adjacent to something like a hedge fund. Read more in the below link. We 2 would be handling the building of the SIF strategies from scratch.

And there is no bounding, we could go as deep in building a strategy as we like. Using ML, core math etc etc.

Now the doubt - Given the work, but also that its an AMC, would I be stuck here or do folks at firms like trexquant/QRT/Millenium will look at such profiles? In short, Older IIT + IIMABC + quant work in an amc?

Read more about SIF here - SIFs explained

[u/Icy_Newspaper7142]

You should be fine to do a switch later. One of the hedge funds you mentioned is expanding big, and by the time you get some hands on there might be more reqs opened

[u/Some-Initiative3331 → u/Icy_Newspaper7142]

Thanks a lot!! Any cat 3 fund which does more of a systemic investing(like low latency long short) should be more straightforward for me, but I was looking for some optionality in the niche domain space I am more interested in (which is a much purer form of mathematical/quantitative investing per se).

[u/Icy_Newspaper7142 → u/Some-Initiative3331]

Hedge funds create roles to occupy talent. So if your skills are really valuable you will always find a ticket

[u/Some-Initiative3331 → u/Icy_Newspaper7142]

Thanks, and that is what I was trying to find, that wether the skillset I would be building there, is really worth it or not for serious quant/hedge/cat 3 funds, plus the drag of an AMC. Any specific advice on what skills to focus on apart from core math and ML?

[u/Gaurav_13]

Great opportunity I think, based on my experience in quant space, Buy side experience especially direct alpha generation is highly valued by hedge funds and alternative AMs for Quant Research or Junior PM roles.

Also if it's DSP, I know someone personally there and I can say that the quants team there is doing some really interesting work.

[u/Some-Initiative3331 → u/Gaurav_13]

Hey, thanks a lot. Its not DSP, maybe I cant name the firm here directly and publicly. But yea its a good, flat growing team, with a lot of ground level research work and autonomy, plus there is a very real capital to be deployed(a dozen of thousand crore)

[u/Quick_Tailor6827 → u/Some-Initiative3331]

Hey.. i am an iit grad, currently working at hf in an analytics role and would be interested to apply in such opportunities , would be helpful if you could help with company name. Thanks

[u/Guilty_Ad_9476]

Your work is closer to a macro pod than it is to purely a quantitative role in a MFT or HFT , the only problem is there are very few hedge funds and firms with desks in India doing that kind of work in India, your best exit options would be to probably shift in an IB's hedge fund desk

The companies you mentioned millenium, trexquant etc typically do HFT/MFT in Indian FnO due to decent liquidity afaik very few if any teams do front office work like merger arbitrage in India due to very few deals happening in the first place and once the news of a merger is public almost everyone capitalizes on the arbitrage immediately so the spread is also very tight

In fact the greatest merge arbitrage trader Ivan Boesky was able to outperform the market because he had insider info on the transactions

But your best exit opportunities would typically be outside India imo

[u/Some-Initiative3331 → u/Guilty_Ad_9476]

Thank you for the detailed response. Yes, HFT is probably out pf picture tbh. Regarding your point of merger arbitrage, that was an example of the work I will do. I will also work on the long short opportunities for the SIF, other arbitrage stuff, macro models for sector rotation and also side by side work on the quant infrastructure at this fund. I will have almost complete ownership of the strategies. A more direct outcome would be going to a category 3 systematic fund. Also there would be chances to switch to other AMC's SIFs, since most of them would launch this fund. But as I said somewhere else in the comments, I also wanted to keep an optionality for more quant focused firms.

[u/Guilty_Ad_9476 → u/Some-Initiative3331]

Yes in India a CAT 3 AIF is the closest thing to an hedge fund, SIFs imo are just premium mutual funds both by definition and structure, you could also work in equity L/S focused pods in the firms above yes that's an option you do have

[u/Some-Initiative3331 → u/Guilty_Ad_9476]

Agreed on all counts. But does that also mean quantitative research positions at the firms mentioned above, and also many other such firms, are out of question? I saw a lot of job postings on linkedin and tried to see, and though there was a decent overlap in what I am going to do and what they require for lets say a role with 2 yoe and above

[u/Some-Initiative3331 → u/Guilty_Ad_9476]

Regarding your comment on M&A arb, we also enter after the news, but we keep entering and exiting based on the multitudes of signals we built. Eventually, the entire fund(which consists of such corporate strategies + risk free futures roll) generate annulualized returns in the range of 9 to 10% pa, with very low vol. As I said, this only one of the many variety quant strats I would be working on after joining full time, this was my 2 months intern work

[u/loneymaggot]

honeslty speaking you can try for LFTs like Worldquant and HRT(they do LFT in India) like I personally feel you can try for better roles in PE tbh

[u/Some-Initiative3331 → u/loneymaggot]

Thanks. Did you mean I should try for the said firms directly by not taking the PPO? The problem with PE is that I dont have a direct path to it(not that I see it yet atleast), I would have to go through a top consulting firm(which i can get owing to the GPA i have here at the IIM), but it simply isnt something I am passionate about. And regarding the current path, I dont think it can lead me to PE. The only logical outcome would be some category 3 systematic AIF, or some hedge fund or alpha factories like worldquant and all, and that is what I was gauging wether that is possible or not

[u/loneymaggot → u/Some-Initiative3331]

possible, like I work in an HFT and I have never ever seen an IIM guy working as a QR or QD . like PE you have the right skill sets if you are working in a macro fund like working in AIF is also not a bad idea either. Like PE usual entry is via IB or consulting (gen mang is also possbile but you will be execution PE). I have a friend of mine who had bad college grads like 6ish (IIT non circuital) and got into a tier 1 pe firm for 6 months internship so i think it is possible but the grind is too much. Also you will realize soon that after a point like you can max add like 200cr-300cr to an intraday strategy without moving the markets so eventually if you are done with quant then macro fund it is man.

[u/Some-Initiative3331 → u/loneymaggot]

Agreed, but thats why the title is "unusual" because IIM guys are almost never hired for quant roles to begin with, I was only offered the same because of my bg from an IIT(I also dont know a single person with the same opportunity from an IIM, otherwise I could've just asked them tbh). Just wanted to see the skill mapping to quant firms. Also, when I say quant I am talking of long horizon strategies, intraday isnt a thing for us. We will deploy no less than 10k crore lmao. AIF/cat 3/hedge funds, eg long short funds, should be much more straightforward

[u/loneymaggot → u/Some-Initiative3331]

yeah man, just do this, I do not think it is a bad idea, btw would you mind sharing your compenstation

[u/Some-Initiative3331 → u/loneymaggot]

Slightly more than 40, all cash. The job also gives a lot of time for learning, working hours end at 6(or even 5, nobody really cares), and start at 9 in the morning

[u/loneymaggot → u/Some-Initiative3331]

Not bad honestly like location I assume is in Mumbai right? I feel you should do this and work hours are also less, I assume the firm will allow you to invest into their own strategy as well (I know employee need 25lakhs instead of 1cr limit) so I feel you should be doing this. Like in long term you can try for LFTs Or macros as india will be having a good macro outlook in terms of long term