The growing need for quants and other post-graduate engineers at hedge funds has altered the culture at many firms that formerly relied solely on traders to dictate their investment decisions. The new wave of tech-focused hedge fund employees has also created a bit of awkwardness in interviews and during the hiring process, at least for some.
A veteran engineer at Google who recently interviewed at a high-profile hedge fund said he was taken aback by a question that he hadn’t been asked in over a decade. They wanted to know his grade point average in college. “At this point in my career, with my resume, I was surprised they’d care,” he said. His assumption at the time was that the firm was just looking to keep him on his toes. Not so.
“They typically ask everyone, regardless of seniority, and believe that it is a strong indicator of success,” said Drew Froelich, founder of Strategic Growth, a New York headhunter that specializes in front-office asset management placements. Froelich said that clients including big quant funds will sometimes ask him to provide a candidate’s GPA during the submission process; other times candidates are asked to include it as part of their application.
People who have previously worked at hedge funds may not get surprised, but engineers who have worked in other industries or who have gone on to earn their PhD do. A host of computer science grads complained about the exact situation facing the Google engineer on a recent Reddit forum. One engineer with eight years of experience said they felt as if they were a lock for the job when, during an informal chat with the hedge fund’s chief technology officer, they were asked about their undergraduate GPA. The engineer answered honestly and explained why it wasn’t a sterling 4.0. “The next day the recruiter calls me and says it’s a no-go for the original full-time position I applied for. [The] CTO was concerned about my poor GPA,” they said. Somewhat oddly, the firm made the person an offer as a contractor instead, despite the hedge fund's admission that they use GPAs as a way to quantify a person's work ethic.
A PhD-level engineer added that they’d never been asked for their GPA until interviewing with hedge funds. “I thought this was pretty odd because my undergrad was about 5 years ago [and] the concept of ‘PhD GPA’ is kind of stupid since PhD students aren't sitting there taking classes all day,” they said. Other posts came from engineers who were equally unaware of the practice and suddenly found themselves nervous about applying to hedge funds.
A second buy-side headhunter said that hedge funds have always asked the question of prospective traders in an effort to trim down the long list of people who are interested in joining. The practice simply hasn’t stopped during the recent quant takeover. “It’s one of the questions I always ask up front,” he said. People who are new to the industry, particularly those with post-graduate degrees, can sometimes act as if it’s an insulting question, he said. “I’d rather them respond to me like that than with a client.”
In short, if you apply for any job at a hedge fund, be prepared to provide your GPA. They may not always ask for transcripts, “but keep in mind that if you are found to be dishonest in any part of your interactions, there will be a bad outcome,” Froelich said.
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