OK – so three hedge fund “titans” took home more than $1bn last year – with the top 25 earners, ranked by Alpha magazine, raking in more than $14bn, about the GDP of Jordan or Uraguay.
The survey put Jim Simons, of Renaissance Technologies, on earnings of $1.7bn, Ken Griffin, of Citadel Investment Group, on $1.4bn and Eddie Lampert, of ESL Investments, on $1.3bn. The previous year, two managers – Mr Simons and the septuagenarian oilman, T. Boone Pickens, of BP Capital Management – topped the $1bn mark.
But what about the mere mortals lower down the pile?
Well Alpha mag has a nifty little function that allows you to see the mean, median and range of base salary and bonus by firm type and job title.
So a junior portfolio manager has a mean salary of $152,744 plus a $492,819 bonus. A senior trader’s salary comes in at $182,019 with a $431,275 to boot.
A lowly junior analyst has a mean salary of $103,852 – but before we start feeling sorry for the poor mite, his bonus boosts that by an average $168,740, to reach a grand total for last year of $266,171.
Delving deeper, we can cut this by region, firm size and by years of experience. Base salaries in the US and UK for analysts are pretty similar at this level, coming in at an average $111,365 and $108,750. But the London-residents do better at bonus time – getting their hands on around $225,000 compared to their average counterpart stateside who has to make do with $175,734.
Only fair – London’s an expensive town, and it costs a lot to maintain a Mayfair lifestyle. For senior analysts, the differential’s even great with those in the UK taking home more than double in total than their US peers.
Looking at years of experience throws up a curiosity – analysts with between one and four years experience can expect an average base salary of $103,673 – with a bonus of $180,482. But for those who made it to the five to eight year bracket, life apparently gets tougher – with a larger salary of $124,500 but a smaller bonus at $96,667.
The pattern is the same for senior analysts, with total remuneration falling over time – thanks to a drop off in the performance-related part of the package.
The moral of the story – if you’re still an analyst after four years, then get out of the business. You’re not going to do well.