A hedge fund is a private investment fund offered only to specific qualified investors who could either be wealthy individuals or large organizations. Their primary aim is to reduce the instability and improve financial safety for the fund investor. These funds are used as a safeguard measure in volatile market conditions. Some of the various job positions in hedge fund work are hedge fund managers, hedge fund administrators, research analysts, and risk managers. These jobs are similar to those found in other investment banking related fiends.
Hedge funds differ from other funds as they are exempt from the general regulations that apply to other mutual funds. The amount of money associated with hedge funds is usually very high and can range from $250,000 to over $1 million. A number of investment strategies are used by hedge funds and they all possess various risks and return factors.
Description
Professionals working in the hedge fund line of work must possess extensive knowledge on the current market trends and conditions, working of funds, laws and regulations related to funds and should have a knack for finding out investment opportunities that are available in the market. Forecasting of market trends is another task carried out by hedge fund work professionals as it is a necessary element in the smooth transaction of funds. A risk manager has to make sure that the risks in a fund are minimized or eliminated, while a hedge fund manager has to take important decisions related to trading. They also decide the investment strategy to be used by the fund. A basic level research analyst take part in research and analysis and formulate strategies for trading.
Skills and Requirements
For most professionals looking to work in the field of hedge funds, a minimum of 3 years of experience in business accounting is essential as hedge fund work is considered to be a step up from other fields of accounting. A hedge fund analyst should possess a bachelor's degree in accounting while a hedge fund manager or risk manager should have a master's in business administration degree with specialization in finance and accounting related subjects. They should be proficient is using software applications such as MS Excel, MS Outlook and Tally as they help in conducting their work in a more efficient manner.
Hedge fund professionals should possess strong written and communication skills. Those working in managerial positions should also possess good organizational and leadership skills. For freshers who have graduated from college, entry level jobs in this sector are a viable opportunity to pursue a strong career in the field of hedge fund work.
Work Conditions
Most hedge fund professionals work in an office based environment and work between 50 and 60 hours in a week. They have to often work for long hours at a stretch and have to deal with stressful working environment when market conditions are not favorable. Long hours of staring at computers screens and remaining seated can lead to eye sight and back related conditions. Overall, those working in the hedge fund industry have to deal with a large amount of stress and pressure on a daily basis.
Earnings and Benefits
The average salaries earned across this line of work may greatly vary from position to position. Owing to the highly money sensitive nature of work, hedge fund managers earn around $300,000 on an average while some top level managers are known to earn as high as $4 billion. Hedge fund associates and analysts are paid around $75,000 to $115,000, which is significantly higher than those working in similar positions in other finance related fields. They also avail benefits such as health insurance plans, pension plans and paid leaves as additional perks for their profile.
Hedge fund work is a lucrative line of work, where one can chalk out a successful career. For those who possess a flair for accounting and investment fund related work, this is the right career which can reap benefits.