If you’re an equity strategist in an investment bank now, you’ll be considerably better off if you base your analysis on bottom-up quantitative techniques than top-down analysis based on macro factors or the geopolitical landscape. You’ll also be far better off if you’re working in New York than the City of London.
So says a new salary and bonus survey from recruitment firm Octavius Finance. As quant strategists have gained in popularity, Octavius says their average total compensation is anything from 30% to 50% higher than bottom up strategists’ in New York and anything from 39% to 66% higher than bottom up strategists’ pay in London.
Thanks in part to the declining pound, strategists (quant or not) are also now paid a lot more in dollar terms in NYC. The average analyst-level quant strategist in NYC is now paid around 45% more than in London. Similarly, the average MD-level top-down macro strategist is nearly 30% better remunerated in London.
Octavius says senior macro strategists are also paid more in New York because they have a higher level of client interaction and will often oversee what their quant colleagues are up to. Nonetheless, NY MD-level quant strategists still earn more – mostly thanks to higher salaries, averaging $450k vs. $350k for their macro colleagues.
The pay discrepancy between quants and macro strategists could rise further in future. Octavius notes that banks are staffing-up quant functions and that talent is limited. In the UK, the also note that demand for equity macro strategists has been reduced by MiFID II.
As Brexit approaches and the pound falls more against the dollar, pay for strategists in London is also likely to decline further compared to pay for strategists in New York. If you work in the area, you may want to position yourself accordingly.