Hedge Fund Analysts’ Salaries Soar

Mark Malyszko of Institutional Investor says that pay at hedge funds is through

the roof:

A senior analyst with three to four years experience at an investment bank

can earn an average $1 million – $1.5 million at a hedge fund, compared with

an average across various sectors of $800,000-$850,000 at a Wall Street firm…

A senior hedge fund analyst with three to six years of investing experience

in the distressed debt sector can receive up to $2 million a year.

I have a feeling this is not going to last. Right now, everybody agrees that

there are too many hedge funds. As a result, they’re all chasing analysts in

a desperate search for ideas and alpha. But most of the smaller funds will fail

– not because they implode, but rather just because they can’t provide

the risk-adjusted returns that investors are looking for, and what investors

they do have will withdraw their funds. When that happens, hedge-fund salaries

are likely to come back down.

For the time being, however, this seems like a once-in-a-lifetime opportunity

to make a vast amount of money quickly. As blogger Under

the Counter says,

Would you rather work at a bureaucratic bank with over draconian compliance

issues pulling down 800k, or a freewheeling shop where they give you the ball

and pay you twice as much?

That is a no-brainer.

Especially if you know you can always return to the bank if and when things

don’t work out at the fund.

This entry was posted in hedge funds, pay. Bookmark the permalink.