Hedge fund vs asset management salary review 2013

I N D U S TRY INSIGH TS

H EDG E F U ND V S . AS S ET MAN AG EMEN T S A L ARY R EV I EW 2013

HE D GE FU ND V S . A S S ET M A N AG EMEN T S A L A RY R E V I E W 2 0 1 3 The Selby Jennings Fund Management team provides leading financial recruitment solutions for Hedge Funds and Asset Managers across Europe. We provide quarterly salary reviews across the industry providing an insight into recent market changes and movements. This quarter, as requested by our clients, we have investigated the difference in compensation between Equity and Fixed Income for Front Office portfolio management. We surveyed a cross section of over 1600 professionals and split them into two categories, which separated Asset Managers from those in Hedge Funds.

Overall, within the Equities sector we found that professionals with less than 5 years’ experience were paid similar total compensations across both Hedge Funds and Asset Managers. However, this is not consistent within the Fixed Income sector, as Asset Managers are being paid noticeably less than those in Hedge Funds.

We believe this change in the market is due to Fixed Income being the most appealing space at the moment, and therefore creating a high demand for analysts to specialise in this field. Additionally, we found that more people got bonuses in Hedge Funds than Asset Managers across both Asset classes at this level.

At the 5-10 year mark, there were some strong similarities in base salaries across both Hedge Funds and Asset Managers, although the likelihood of not receiving a bonus was higher within Equities than Fixed Income. Clients believe this was down to the poor fund performance within Equity Funds over the past year.

At the 10+ year mark we saw that Equities paid higher for Asset Managers than within Fixed Income. Firstly, Equities is an asset class that is not performing particularly well, and as a result large traditional Asset Managers are looking for successful senior candidates whose knowledge and experience in the Equity Markets is invaluable for creating positive performing track records. Therefore, this increased demand for experienced Fund Managers in Equities has led to an increase in salary levels for such candidates. Secondly, these higher senior level salaries are a reflection of the markets back in 2008. Salaries were then pushed up due to the stability within the Equities space and investors showed preference for Cash Equities over Fixed Income.

However, when looking at Fixed Income we found that Hedge Funds are paying the highest total compensations, which mimic the steep increase in Fixed Income hiring over the past year. We have seen a huge amount of senior movements within this space and in particular we have seen strong portfolio managers moving to Hedge Funds.These movements enable them to take more risk and branch out into more illiquid or stressed products.

EQUITY

Asset Managers

Average Base

Range in Base

Average Bonus

No Bonus

Less than 5 Years

(£ K) 72

(£ K) 40 - 145

(£ K) 42

(%) 7.40

5 to less than 10 Years

88

50 - 140

68

19.30

10+ Years

124

75 - 200

114

10.50

Average Base

Range in Base

Average Bonus

No Bonus

Less than 5 Years

(£ K) 71

(£ K) 40 - 140

(£ K) 56

(%) 13.90

5 to Less than 10 Years

103

60 - 165

107

14.50

10+ Years

133

50 - 250

138

25.00

Asset Managers

Average Base

Range in Base

Average Bonus

No Bonus

Less than 5 Years

(£ K) 55

(£ K) 37 - 80

(£ K) 15

(%) 20.00

5 to less than 10 Years

77

45 - 115

52

9.00

10+ Years

119

70 - 240

89

10.00

Average Base

Range in Base

Average Bonus

No Bonus

Less than 5 Years

(£ K) 85

(£ K) 45 - 130

(£ K) 58

(%) 3.00

5 to less than 10 Years

111

50 - 200

116

1.20

10+ Years

161

85 - 330

212

0.00

Hedge Fund

FIXED INCOME

Hedge Fund

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