All Posts By

Kelvin Jiang, CFA

How to Short a Stock: 4 Ways to Develop Short Ideas

By | Investment Process | No Comments

Pokemon Go’s popularity exploded like a firestorm. The mobile hit leapfrogged Twitter in active users in just days after launch, and Nintendo’s stock price has risen 57% since. Expectations of further monetizing Nintendo characters are high. But let’s think about the reverse – could Nintendo be a prime example of how to short a stock?

Are the lofty expectations for Nintendo realistic, or is there irrational exuberance?

Pokemon Go is certainly not the first mobile game with high expectations, and it won’t be the last either. In 2013, a Japanese game developer called Gungho Entertainment released Dungeons and Dragons, wich monopolized mobile usage among Japanese teenagers. Gungho’s stock skyrocketed 2100% in just 5 months.

But as the game waned, Gungho’s stock price has dropped 80% since. And before Dungeons and Dragons, there was Farmville. A similar story played out with its developer Zynga.

Each case is different. Whether history would repeat itself in Pokemon Go is up for debate. But irrational exuberance is certainly one of the central themes in developing a short stock pitch.

Good advice on how to short a stock is notoriously difficult to find. There are a plethora of volumes written on finding undervalued investments to go long. But what would make a good short stock idea? Is identifying unrealistic hype simply enough?

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The Difference Between Working at a Mutual Fund vs. Hedge Fund

By | Career Insights | No Comments

Today we continue the conversation with our investment industry veteran, who began telling us the story of investment banking to the buy side. In Part 2 here, we’ll talk about what it’s like to work at a mutual fund vs. hedge fund. Working at a mutual fund vs. hedge fund has a lot of similarities on the surface. After all, it’s all about investing!

However, as we dig deeper into the comparison, we’ll see that there’s are significant differences in the lifestyle, nature of work, compensation structure, and career trajectory. Some of the answers might surprise you.

Without further ado, let’s get right down to it and continue our conversation. If you haven’t read the first half of the conversation, I recommend you start with Part 1 here.

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Insider Advice on Investment Banking to Hedge Fund

By | Career Insights | No Comments

When I recruited for the buy side as an investment banking analyst, I thought it would be fairly easy. After all, everybody said that investment banking was the best career path to a hedge fund. After going through the process, however, I can say from experience that there’s no easy way to the buy side. Not even for investment banking to hedge fund.

Today, we speak to an industry veteran who has done it all: engineering, investment banking, family office, hedge fund, and mutual fund. Very few people have this level of insight on how to get to the buy side by making multiple career transitions.

Needless to say, a lot of networking and career planning was involved. We’ll talk go over this person’s career in detail: networking, recruiters, nature of work, the difference between investment banking and hedge fund, and whether it was worth it.

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The Complete Guide to Developing a Stock Pitch

By | Investment Process | 3 Comments

I’ve written over 30,000 words detailing what it’s like to have an investing career. I’ve laid out the step-by-step process to get a hedge fund job for both experienced professionals and MBAs. What’s the one key takeaway from these guides? Having a killer stock pitch is what matters the most.

Making a strong stock pitch is the way to get your foot in the investment industry. It’s how you can become a professional investor.

Let’s go into the stock pitching process in detail.

This is a deep dive into analyzing and pitching stocks. We’ll go over how to screen for stocks, develop an investment thesis, analyze the company and industry, value the business, and assess the catalysts and risks.

A lot is taught on investing theories and frameworks in school. But little is said about how investment analysts actually pitch a stock.

If you’ve ever taken a finance class, you’ve probably left wondering: how do I actually put together a stock pitch the way professional investors do?

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Do I have the right background for hedge funds?

By | Career Insights | No Comments

Self-confidence can be elusive, especially when you are trying to break into investing, one of the toughest careers to get into. Give yourself credit, though. Just making that career decision alone speaks volumes about you. Remember the moment that you put your foot down on having a hedge fund career? That was already a major vote of confidence in yourself. Yet, why do so many of us doubt ourselves as we dive deeper into the hedge fund job search? Why do we have constant insecurities about whether we have the right background for hedge funds?

This self-doubt is pervasive. It affects everybody who has ever thought about making a transition to asset management. I mean everybody, from the ex-Goldman Harvard Business School grads to the liberal arts college seniors.

The self-doubt comes in an alphabet soup of “if only” thoughts…

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