Bluecrest Capital Management is the hedge fund in which many prop traders from investment banks have found a happy new home as the Volcker Rule forced banks to cut back. The hedge fund has ramped up compensation costs for both partners and rank-and-file employees over the past year and has drastically increased headcount, even in the face of tumbling profits.
Bluecrest has just released its annual accounts for the 12 months to December 2013 on Companies House, which show an 11% reduction in pre-tax profits as poor performance in its flagship fund pushed fees down by 9.4% to $905.4m. However, this has not dampened the hedge fund’s appetite to hire.
Over the course of the year, its partnership increased to 155 people, up from 134 in 2012 and staff numbers swelled to 356, up from 250 in the prior year. Bluecrest’s expansionary tactics have allowed it to poach top traders from rival hedge funds like SAC Advisors as well as investment banks UBS, Morgan Stanley and Nomura throughout the course of 2013.
Not surprisingly, despite the dampened profits, Bluecrest has had to put its hand in its pocket as it increases employee numbers. Pay for its partners in the last year was $512.8m, up from $463.9m in 2012. This averages out at $3.3m per head, which is a slight decrease on the $3.4m average paid out in 2012.
Staff costs elsewhere increased by $40m on 2012, to $137.1m. Again though, this increase looks purely down to the rise in headcount, as average pay per head was $385.1k last year compared to $388.4k in 2012.
Bluecrest has continued its expansion throughout 2014 and headcount in London has increased by nearly 19% over the past 12 months.
Top researcher joins hedge fund Millennium Capital, leaves after 3 months
Brevan Howard: Gone Swiss?
Tudor Investment Corporation’s co-founder on how to be a great hedge fund trader