Hedge fund bonuses, once stereotypically viewed as the fast-track to the Sunday Times Rich List, are said to have have tumbled by 94% to a mere £85k average this year. Not enough to start pulses racing among investment bankers and certainly not up there with the Paul Tudor Jones and Alan Howards of this world.
However, while pay surveys suggest an era of belt-tightening among hedge funds, the accounts of London-based firms demonstrate that big pay packets remain. Make it to partner in a prominent London hedge fund and you’re almost guaranteed to make seven figures, or at least so suggest the latest accounts of a selected group of hedge funds.
Having analysed these accounts, we've displayed our findings in the table below.
BlueBay Asset Management: the highest paying hedge fund in the UK
At partner-level, the highest paying hedge fund in London during 2013 was BlueBay Asset Management. BlueBay paid an average of $7.3m to each of its 25 partners – an uplift of $900k per head on 2012.
Capula Investment Management, the fixed income focused hedge fund set up by former JPMorgan prop trader Yan Huo, slashed pay for its partners in 2013, but still paid an average of $5.8m to each one during the year.
These figures apply solely to partners, whom - as we’ve mentioned previously - receive a proportion of the fund's profits and are therefore the best paid. However, for rank and file staff, most hedge funds have also remained generous.
Accounts for Arrowgrass Capital Management suggest an average payout for its employees of $564.1k for 2013, while Capula has kept pay high at $425.6k for the rank and file.
The biggest drop was at Brevan Howard. Partner pay fell from an average of $8.8m in 2012 to $2.17m last year, while pay per head for its employees slumped to $255.4k, down from $577k in 2012.
The current state of salaries, bank by bank
Morgan Stanley’s London pay is half that of Goldman Sachs’
Expansionary hedge fund ramps up headcount and pay even as profits dive