If you want to make the big bucks working for a hedge fund, you really need to make it to partner where you’ll gain a share of whatever profits the firm brings in. Outside of the upper ranks, hedge fund pay remains high, but a far cry away from the sort of figures that keep the Aston Martin and Ferrari retailers of London in business.
At least this is the conclusion from new figures from real-time salary data provider Emolument.com. These figures have, we should admit, been reported elsewhere, but the figures of £8k for 2014 bonuses featured on Bloomberg are incorrect.
Actually, bonuses for directors in hedge funds were around £85k on average, it suggests, up from £40k in 2013, but still a long way off 2012 numbers, which came in at £135k. Total compensation this year was a non-too-shabby £175k median, which is still a big drop from the £265k paid out two years ago.
What can you get for £85k? Well, a three-bed holiday home in Cornwall, a modest deposit for a two-bed flat in Clapham or a parking space in Mayfair in the heart of London’s hedge fund industry. Presumably, you’d be more likely to be parking a 2012 Golf than a brand-spanking new Aston Martin.
For the sake of comparing apples with apples, it’s worth pointing to what Emolument suggests is the median package for a director working for an investment bank in London. Base salaries of £150k were combined with a £120k bonus this year, it says, or a total package of £270k.
Private equity juniors increasingly toiling for benefit of their highly paid bosses
Investment banking or asset management: which pays the most?
Where in the world do senior investment bankers earn more? It’s not where you think