Institutional Sales Compensation Structure
Hi Monkeys, does anyone have any color on how Institutional Salesperson are compensated? Do they receive commissions on top of base & bonus? What % of gross AUM fees do Salesperson receive?
Any figures for Analysts to MD would be greatly appreciated.
Hedge funds can be different but traditional AM shops pay a salary plus commission. This report is for alternatives but is very accurate. I would say associates who supports external sales people make 100-200k. External salespeople can make $250k to over a million. I’d guess average for a tier one firm is $300-600k total comp. my old firm paid a salary of $150-200k.
Thanks, great hearing that perspective. Any idea on how does the commission structure work? What % of fees do they receive?
We paid a percentage of revenue but I’ve also seen places do a percentage of assets. I think most are a percentage on revenue. And your % will be based on your territory and goal. If you have the relationships at the big consulting firms then your goal will be much higher than someone selling to directs in a shitty territory.
Base+Bonus+Commission is common across the industry these days. Commission is typically based off new revenue, with a multi-year trail payment. Sometimes the % commission decreases after Year 1.
Bonuses are becoming more common as way for firms to incentivize sales people to service and preserve existing accounts. With fee revenue decreasing, firms are putting higher emphasis on keeping assets (with hopefully higher fees).
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