Pay in fund management has traditionally lagged that of investment banking, but the gap is closing as sell-side bonus payments are clamped down upon by regulators. Fund managers have always been more cautious with what they pay their staff and have implemented bonus deferrals and required portfolio managers to invest their variable compensation into their own funds in order to mitigate risks.
However, while banking pay has been going down, fund managers have seen their wallets grow. In 2014, an investment professional working on equities in a U.S. mutual fund could expect total compensation of $570k, according to figures from Greenwich Associates and Johnson Associates. Those working on fixed income portfolios, meanwhile, can still bring in $350k, it suggests.
While banking pay has been going down, fund managers have seen their wallets grow
In the UK, starting salaries in asset management come in at around £35-40k ($55-62k), according to figures provided by PwC. Junior portfolio managers, meanwhile, earn £50-60k in base salaries with a 20-30% bonus. The more senior you get, portfolio management positions tend to pay £130k, plus a bonus of 100%, suggests PwC.
If you make it to head of the investment team, you can get a £170k bonus, with a typical bonus of 150-200% of salary.