sell side macro trader with 9 years experience at a US BB in London . Finally got a sub pm job offer but wanted to assess whether i'm being lowballed. Any advice appreciated.
160k gbp base, 100k usd sign on, 14% pnl payout, 0.5% cost of capital, 7.5% drawdown stop.
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What is the rough average of your last 3 year comp and risk budget?
rough average 425k usd tc
So at 150mm aum x let's say 5% target return (on 7.5% hard draw) x 14% payout = ~$1mm target comp. Obviously riskier seat but lot of upside to grow if you perform, assuming the PM path is something you want to go down it is a fair deal. Be careful about netting risk if applicable, ask for past track of what you're being netted against (how many years in the last 5 would I have been netted down, is there a deferred pool to floor me in that case, etc)
Sign on is reasonable given past comp and assuming you aren't walking from meaningful deferred.
14% payout at face value is great. What's the AUM? It's also critical to understand what the 7.5% drawdown is measured over (is it over levered or unlevered AUM).
aum is 150 mio usd
-.
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Is your book multistrat or will you be trading just 1 asset class/product
focussing on 1 product class in macro (rates/fx)
Cool
.
14% as sub-PM straight from sellside and frankly fairly junior pre-buyside seat is extremely good. How would netting work would be the obvious first question, along with the scalability of your strategies/mandate over time. But this is very good.
thanks for responses so far. i guess my only hesitation is that i'm probably on a path at my current place to be clearing 6-700k+ USD annually. quite hard to walk away from the stability to deal with the comp vol
what's the path / how much longer to get there?
i got just shy of 600k last year. would assume 6-700k is doable in the next 1-2 years
I think the terms are good, but the bigger question revolves around netting risk / what team you are joining. Think its night and day difference if its an established large team that has been at a big-name platform together for a substantial amount of time vs. smaller / newer team at less established platform. 14% vs. 12% payout is a small difference in comparison to 15% vs. 50% netting problem / team dissolution in the next three years.
I have never had to make a call like this one so hard to opine on how I would handle, but I do know multiple people have done the switch and run into netting / team issues in the first 1-3 years. While they may not have regretted the decision bc they want to more seriously pursue buyside rather than sellside, they certainly have found themselves in substantially worse compensation situations than if they had opted to stay. FWIW, 6-700k annually in London actually pays for a great quality of life and to a much greater extent than in Manhattan so its not an obvious choice. You can also be patient, its not like you won't get this look again in the future - if anything you'll probably get one with even better economics in a few years time.
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