Three In $1M HF Comp Club

Date: Thursday, November 29, 2007
Author: Hedge Fund Daily

Who holds the best paid position at a hedge fund? It’s the director of sales and marketing, who, according to Infovest21’s latest executive compensation survey of hedge funds, earns an average of $1.3 million, even as it earns among the lowest base salaries. The two other members of the million-dollar comp club are the CEO, who takes home on average $1.1 million and the chief financial officer, with $1 million. The next tier—earning tops in base salary and bonus—are the head of trading and the CIO, pocketing an average of $800,000 and $900,000. In other tiers:

The director of research and chief operating officer fall in the $700,000-$800,000 range.
Portfolio managers and assistant portfolio managers saw a total pay package of between $470,000 and $600,000.
The lowest pay packages went to senior analyst, general counsel, chief administrative officer, chief risk officer, mid analyst, director of investor relations and junior analysts, with $200,000-$400,000.
The highly compensated director of sales and marketing has a base pay falling between $150,00 to $200,000, in good company with the chief risk officer, director of investor relations and chief administrative officer, among others.
The survey found that chief investment officers had the highest base salary of $253,000, while that of the CIO, CEO, research director and CFO, general counsel and chief operating officer also fell in the $200,000 and up range. Receiving the lowest base salaries of between $100,000 and $150,000 are assistant portfolio manager, senior analyst, mid analyst and junior analyst. According to Infovest21, the chief operating officer had the highest base-to-bonus ratio. Commenting on the research, John Breault of MJE Advisors, which sponsored the survey, said, “Compensation expectations were at an all time high for hedge fund professionals before the shock of subprime.” Breault noted that 2008 may be the first year since 2003 that year-over-year total compensation will decrease in many areas of financial services, making it “a great opportunity for alternative investment firms to recruit talent to bolster their infrastructure for their continuing institutionalization.”