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Opalesque Industry Update - In its just-released "13th Annual Compensation Survey for Hedge Fund Managers with Assets Over $1 Billion," Infovest21 found that the Chief Executive Officer is the highest paid position at $3 million. The Chief Investment Officer received the second top paying compensation package at $2.2 million. Meanwhile, four positions have an average total compensation of $1 million to $1.9 million - Chief Operating Officer, General Counsel, Director of Sales & Marketing, and Portfolio Manager at $1.9 million, $1.1 million, $1.0 million and $1.0 million respectively. Five positions have total compensation between $500,000 and $999,999 - Head Trader, Senior Analyst, Chief Financial Officer, Director of Investor Relations, and Mid Level Analyst. Three positions have total compensation in the $300,000 to $499,000 range - Compliance Director, Client Services, and Director of Operations. Three positions had total compensation below $300,000 - Junior Analyst, Controller and Fund Accountant. 2014 vs 2013 Comparison In comparing 2014 results with those from the 2013 survey, the results generally reflect lower compensation for investment and financial positions while some of the back office positons had higher levels than 2013. Top management positions had mixed results. For top management, Chief Executive Officer and Chief Operating Officer saw higher levels of total compensation in 2014. In the investment category, Chief Investment Officer, Portfolio Manager, Senior Analyst and Junior Analyst had a lower total compensation in 2014 than 2013. Lois Peltz, president of Infovest21, observed, "A possible explanation for their drop in compensation is performance. A wide performance dispersion existed among the surveyed managers. Year-to-date-performance through the end of October ranged from -3% to a high of 24%. The mean return was 5.5%. About 73% of the managers said they are above their high water mark and earning their performance fee." In the financial category, Chief Financial Officer, Controller and Fund Accountant all had lower total compensation in 2014 than 2013. In the sales and marketing category, the results were mixed as Director of Sales and Marketing dropped but Client Services increased from 2013. Back office positions e.g. Compliance Director, Director of Operations and Head Trader, saw a general increase. Assets under management have a definite impact on compensation results. Those funds that had over $5 billion in assets had higher compensation than those below $5 billion in all positions except Chief Financial Officer. Profile The profile of the average hedge fund manager who responded to the survey had average assets of $3.6 billion and, has been in existence for 17 years. Methodology The survey was conducted during September, October and November by phone or email. The results are based on data from 15 separate hedge fund management firms, all with assets over $1 billion. In calculating the statistics throughout the survey, only respondents who provided concrete compensation data with dollar figures were included. Twenty executive and back office positions were included: Top management Chief Executive Officer Chief Investment Officer Chief Financial Officer Chief Operating Officer Chief Risk Officer Investment Portfolio Manager Senior Analyst Mid-Level Analyst Junior Analyst Director of Research Sales and Marketing Director of Sales and Marketing Director of Investor Relations Client Services Legal/Compliance General Counsel Compliance Director/Manager Financial Controller Fund Accountant Operations Director of Operations Trading Head Trader Other IT Separate surveys were conducted and results analyzed for those managers with assets over $1 billion and those with assets under $1 billion. Similar compensation results will soon be released for funds of funds. Press Release
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Industry Updates
Hedge Fund Manager Compensation Survey: CEO tops compensation survey at $3M, CIO at $2.2M
Monday, December 08, 2014
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