What does hedge mean
What does it mean when we say someone is Detail Oriented?
You can call it "detail oriented" or "attention to detail". The central idea is same. During my internships the senior bankers continuously emphasized that one has to be detail oriented. This literally meant that you do not loose the sight of the big picture while at the same time not miss a piece of information that is relevant and material.
I would like to outline what I mean by detail oriented. I invite you all to contribute (per your understanding) what you mean by "detail oriented".
You can include examples or interpretations or may be synopsys of a specific action you took in a specific situation and this action reflected how detail oriented you were.
1) Cosmetics - Fonts and their sizes are consistent throughout the document. Alignments, Colors, free space. even comma, semi colon and full stop etc.
2) Drill down - You do consistently drill down (double click) on a specific title/point and identify errors/counterexamples/mistakes/inconsistencies/special cases/sub-points deserving more attention etc. Say Level 1 => Level 2 => Level 3. This may be hierarchical or constituents.
3) You do not fail to consider the "WHO" part and the incentives/disincentives/skills part. e.g. who has the best skills/incentives and information to make a particular decision. If the fund's life is going to end soon then the PE firm may not be able to invest into our target.
4) You make sure you read and factor in the information provided by footnotes in 10K.
5) In identifying the comparable companies you typically look at the size, sector, sub-sector, goals/mission, geography, strategy, risks. But you also look at the capital structure (e.g.
debt levels) to see if that is applicable, relevant and material in that particular case.
6) You do not fail to test the reverse argument. e.g. If a company converts a fixed cost into a variable cost then that is considered a desirable thing (by and large) especially in credit analysis. But there may be a situation in which converting a variable cost into a one-time fixed cost may be desirable too (sometimes).
7) You make sure you find out about the credit-worthiness of the "TARGET's" main customers and their debt levels as well. High debt levels in these customers may lead to liquidity or worse solvency issues.
8) You typically make sure you are factoring in the target's key industry trends, impending regulatory changes, key industry level issues, public perception issues, LOCAL socio-political issues. But you also do not fail to consider issues and trends from other industries which affect target's industry. e.g. Refi-cliff and its impact on a number of non-financial industries.
9) You do not ignore the organizational maturity as a factor. What the target has achieved in the last 3 years may be simply because of the maturity of the organization and not mainly because of the smartness of management.
10) You do not fail to ask - What is the most obvious thing I am missing here. What is the writing on the wall that I might have ignored.
Some of these may be simplistic or product of my very limited experience.
But please feel free to correct me/criticize me. And do not forget to add new stuff - explaining your view of what constitutes detail orientation.
(The target is investment banking/private equity /LBO /Mezz investments.)Source: www.wallstreetoasis.com