There are plenty of good reasons to want to work for a hedge fund. It’s exciting, the hours aren’t as brutal as they are on the sell-side and the job comes with a host of sweet perks. Of course none of those are the real reason people chose to work for hedge funds. It’s the money. Hedge funders made bank last year.
Total mean compensation for investment professionals at hedge funds nearly surpassed $950,000 last year, up 18% over 2012 numbers, according to Institutional Investor’s Alpha.
Senior portfolio managers took home the biggest haul – an average of over $1.4 million – though junior portfolio managers saw the biggest increase in year-over-year compensation with an 81% jump to $887,000. The average senior PM saw a 27% increase in total comp.
But perhaps the biggest surprise in the report is how well non-investment hedge fund employees did. They earned an average of $575,000 last year, up 6% compared to 2012. Compliance and risk roles may not have the same cache, but the money is still there.
The financial windfall came during a decent but less-than-spectacular year for hedge funds, which returned an average of around 10% in 2013. That would be all well and good if the S&P didn’t climb 30% during the same period. Obviously most firms are hedging against risk, but that’s still a fairly wide disparity.
Investors don’t seem to mind all that much. The industry is on pace to attract as much as $171 billion in new investments in 2014, which could push total industry assets to a record $3 trillion by the end of the year.
Here’s a host of resume clichés particular to each line of business in banking that will severely hinder your chances of scoring an interview.
You might think the extraction of nearly 30% of the investment bank’s headcount would cause some upset within Barclays. Not at all. By the way, Barclays just cut seven people from its Scandinavian and continental European fixed-income teams.
Former Bank of America executive Sallie Krawcheck is launching a new index fund that invests in companies that boast strong gender diversity.
Former Morgan Stanley rainmaker Paul Taubman is starting his own advisory boutique. He’s already poached two senior bankers from his old employer – Robert Friedsam and James Murray.
KCG, the byproduct of the Knight Capital and Getco merger, suspect that a former technology executive who now works for rival company Clearpool Group may have stolen the trading firm’s computer code. Raymond Ross, chief technology officer at Clearpool, has denied any wrongdoing.
General Re, Berkshire Hathaway’s asset management unit, has promoted Bill Rotatori to chief executive officer. Rotatori is replacing Jerry Lynch, who will retire at the end of the year.
Halcyon Asset Management has hired former Benros Capital founder and ex-Goldman prop trader Daniele Benatoff as the new managing principle in charge of the U.S. firm’s push into Europe. Halcyon is currently recruiting a co-head to join Benatoff.
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Quote of the Day: "I would say that my job, when things are going well, there's nothing more fun and I can never imagine leaving it. When things are going badly, my sense of responsibility takes over, and I couldn't imagine leaving it," Goldman Sachs CEO Lloyd Blankfein squashing any retirement talk