According to Greenwich Associates, the average salary of a hedge fund manager last year was $280,000. The average annual bonus was $900,000.
Who can expect a good bonus this year?
“It’s been a tricky year for most hedge fund strategies, and won’t be a bonanza year for bonuses. Obviously, the managers whose strategies have performed are the ones that will get the big bonuses. So, for fund of hedge funds managers, it’s not looking good,” says one London-based hedge fund recruiter.
So who has performed?
Performance to end October, year to date (CSFB/Tremont):
l –3.06% convertible arbitrage
l –1.62% managed futures
l 0.76% fixed-income arbitrage
l 4.19% multi-strategy
l 4.40% long/short equity
l 4.45% equity market neutral
l 6.04% event driven
l 6.40% global macro
l 11.8% emerging markets
Who needn’t worry?
According to media reports, UBS Investment Bank is set to reward staff at its new hedge fund unit, Dillon Read Capital, with a shared $1 billion in bonuses over the first three years. The unit has 120 staff, equating to around $2.78 million in bonuses each a year. It is hoped the high bonus pool will prevent staff from leaving to go to competing hedge funds.
Who will never need a bonus again?
Edward S Lampert, chief investment officer at hedge fund ESL Investments.