Asset management scene in Europe/MENA ex-UK

Hi, are there any reputable long onlys (equities or credit) in continental europe (France, Benelux, Switzerland)? Looking for concrete data points on salaries, hiring/recruitment, career progression.

 

Big gulf between Switzerland and the rest of continental Europe. 

From what I've seen Switzerland pay is broadly in line with what you'll get in the UK, which is only a small discount to the US. 

I strongly recommend against going into buyside in any of the other places you mention. Pay, especially after the government takes their massive share, is absolute peanuts. Netherlands has a cap on bonuses too. I'm in a front office role at a successful local fund, solid AUM and very good track record, and I take home like 4k per month after tax with 4 years xp. People here talk about low six figure salaries with wide eyes lol. You honestly feel like you're not even in finance. 

 

Speaking for the UK at least, it feels like salaries have not been adjusted for the weakness of the GBP in recent years. But in general the UK follows the US formula of paying high salaries to professionals while taxes are generally lower than on the continent. 

Salaries in the EU are materially lower again, I can't really think of any one reason for this but thinking out loud:

  • Tax systems are generally way more punitive and complicated, disincentivising high pay (while also creating incentives for all kinds of other weird perks like company cars etc)
  • Cultural reasons; people here generally believe in income equality and redistribution
  • Possibly some impact from the EU in that there's a wide gulf in development between countries; maybe this results in some kind of salary averaging across borders (i.e. a Danish bank can hire a Portuguese graduate etc)
 

Which AM's are strongest in EMEA equities?

How does European comp scale beyond grad level positions?

I suppose you work in AM in London - would an ex-BB IB analyst be an attractive profile? What is interviewing, recruiting like?

Is there geographic flexibilty? Ie can you work for an AM in another European country?

 

Which are some of the better Paris boutiques? Are there any larger names to look at in Paris (Amundi perhaps?) 

 
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I am a young(ish) senior PM in equities at a pension fund in Continental Europe, so I can give you an idea of what I've seen so far. I've worked only for one company in AM and used to work in London before, so I can't claim to have a full picture. But I have interviewed with a few asset managers and pension funds in the region, so have a broad view on salaries and progression. 

I agree with Balance.of.Payments that Swiss AM pays the best in Continental Europe, probably followed by Germany in the region. Apart from the bank AMs (UBS, CS rip, DWS) and insurance AMs (Allianz, Axa, NN - now Goldman Sachs...), some of the better paying ones are boutiques or family offices. There are also some big AMs that pay ok, like Amundi and Robeco (I heard Pictet pays very well, but don't have first hand knowledge of that). Others I've interviewed with are Kempen and Candriam, which I found were a bit below, but still decent. Pension funds comp is anywhere between a bit below the commercial managers and a lot below the commercial managers.    

In terms of continental Europe pay, what I've seen if that a PM would indeed get a total comp that starts in the low six figures, as Balance.of.Payments mentioned, and I'm not sure how far that scales up to with experience. However, in a lot of European countries, EUR150k puts you in the top 1-2% (equivalent probably to about $400k in the US). Even a EUR4k monthly net salary is in the top 10% before any bonus. So the quality of life can be better on far less money.

Some other positives to Continental Europe are the WLB, flexibility on home working, holidays (I've seen allowances of 40 days), paid commuting, less travel required etc.   

Hiring/recruitment: unlike the US, there can be several entry points into AM, a lot of juniors from the bigger managers actually start there in training/rotational programmes straight out of university or following internships. For experienced hires, e.g. analysts or junior PMs, people generally come from other asset managers or sell-side research, few from IB/PE vs in the US. For credit you get some from rating agencies, for sovereign/rates you can also get strategists or people from central banks.

Career progression: I think it is more varied vs the US because the culture can be quite different between AMs. For example, some places give people the PM title after 2-3 years of experience (particularly in some pension funds), while in others it is somewhat based on tenure rather than results. Otherwise the titles are pretty much like the US, some pure play asset managers also use bank type titles (eg. Assoc/VP/Director/MD). 

 Happy to expand on these if you have follow-up questions, I think your original post was a bit too broad for a quick answer.   

 

Agreed, I think my post was vague - I'm still trying to get the landscape of AM in Europe. Thank you for the very detailed reply.

Geographies: you mention Swiss AM's pay the best. Are they all located in German Switzerland? I know Pictet and Lombard Odier are in French Swizterland (more interested in this area). Do you know any other names in French Switzerland/Geneva? How do you learn of/find boutique/family office type roles?

Comp: I understand your point on 150kEUR being alot for Europe, and I completely agree with the WLB perks that come with working in Europe. Is this 150k figure you quoted in line with the "top" country (Switzerland), or in general for continental Europe?

Hiring: My understanding is that in the US, it's common to do 2yrs IB + 2 yrs PE/HF then go to MBA, and only then will you be competitive for a good AM seat. My impression is that it's different in Europe, with sellside reserach perhaps being the most common path in. Would coming from an IB background put me at a disadvantage? In your experience (interviewing as a grad, and interviewing potential analyst candidates), what is an interview process like? Stock pitches? Walking through investment framework/mindset? 

More broadly: what makes a good candidate, and how do you know you like this job/asset class (public equities), as opposed to something else? (as I am trying to figure out what asset class I like myself).

Thank you in advance, and sorry if these questions seem a bit scattered, I'm still trying to get a feel for the landscape and having career doubts. 

 

Here's some responses on your questions.

Geographies: By Swiss AM I was referring to both German and French parts (eg. Pictet). Apart from Pictet, Lombard Odier, there's UBP in Geneva, UBS/CS in Zurich, probably Julius Baer, Bank Safra Sarasin, Edmond de Rothschild, Vontobel and I think Partners Group and LGT Capital also have a small team doing public equity investing. But really, I don't have a list of the AM industry in Switzerland, since I never worked there, so I don't know how many people these would have doing investments based in Switzerland. You can learn of various firms by going some google research, speaking to AM people there or headhunters (if they respond).   

Comp: the EUR 150k was for continental Europe (don't get too hung up on that number, it was just to show where that type of comp would land you in the income distribution in many Western European countries, not how much you can make as a PM). For example, my total comp is above that number and I'm still in my 30s, so it's by no means a ceiling nor a floor. Swiss total comp will probably be higher, but cost of living is also higher there. 

Hiring: While backgrounds for your initial role in the industry may vary potentially more in Europe vs US, I don't think starting in IB would count against you. By the way, I think people on WSO also overemphasize the golden ticket of IB to PE to MBA to AM, I've met plenty of PM from the US at conferences that didn't follow that route. If you go for the IB route, try and join AM as soon as possible. From sell side research, you could potentially come in as a more senior analyst, maybe even a junior PM role. From IB/PE it's much harder to come as anything more senior. 

Hiring: Interview process tends to focus as much on fit as it does on technical skills. Would likely include a stock pitch and/or investment case (a more detailed pitch that you can get assigned and given a week or 2 to prepare). The investor framework is more important if you already work in AM and are moving shop. For a PM role you may need to prepare a paper portfolio as well. One thing that is quite common is to interview with every member of the team, so you may have a lot of interviews if you're joining a big team. Often the final round is a day in the office were you discuss the investment case, interview with everyone, potentially another HR interview and maybe more fit interviews.

More broadly: To be honest, I'm not sure how you choose your asset class, it seems often you either have a passion for something or you fall into it with your first job. I always preferred equities to credit/derivatives, so I went in that direction. I like fundamental equity because I want to learn about industries, companies, products, and I'm not that interested in following technical market mechanisms. This may be a very simplified way of looking at it, but derivatives tends to be more mathematical/quant in approach, then credit, and then equities. 

Many things make a good candidate, but what I look for in people is intellectual curiosity, ability to form a view, logical thinking and ability to respond rationally to being challenged.   

 

What are peoples thoughts on aviva investors in the UK? Is it reputable?

 

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