PE to HF - did you take a pay cut?
Currently work in PE and considering to move to SM HF
By talking to peers it sounds like most at "top"/most established funds start at a range somewhat below MF PE, all in post banking
Does this amount increase for post PE folks? If not do people take a pay cut going from PE to HF? How do you justify that decision?
Haven't really heard that for the top established funds. I can tell you going to Maverick, Viking, Baupost, Elliott straight from Banking will net you more than any MF PE even Apollo. For the citadels of the world I think comp is around $300k which can be less than some of the MFs yes.
If you go to HF after 2+2 IB/PE, then yes the comp will be higher for sure and you won't be taking a pay cut in all the standard scenarios. If you go from making $500k at Apollo to some smaller HF that only guarantees $350k as a floor then sure there's those cases, but no one I know took a pay cut going from PE to HF, especially a tiger cub. Not even the friends who were at Apollo/Centerbridge, although they all went to Viking and Elliott mostly.
Thanks, helpful. What about for funds that are one tier below the ones you mentioned? I didn't expect funds to be willing to pay $400-500k for someone without public markets experience.
And for those funds if you join after 1 year in PE vs. 2 years do you get paid somewhere in the middle of post-banking and post-PE?
I’m not sure about the latter question but it stands to reason that your comp is less as a 2+1 vs. a 2+2 but still would be a pay bump. Depending on the place maybe it wouldn’t even matter at all that much to them.
I think even 1 tier below you’ll still see pretty high comp. maybe would have to take a haircut or par to Apollo comp but still $400-$500k range I’m sure. There’s a lot of good hedge funds with attractive AUM $ per Investment professional (and many more that are subpar I’m sure).
Whatt about leaving banking after, say, 7 months -> 12 months? What types of funds if you’re from a decent group (not GS tmt but not MM)
Some programs (like pods) might have standardized pay for junior people (no HF exp) but from a MF PE fund probably shouldn’t be expecting a pay cut because you can probably get whatever job you want coming out of there
Definitely not. Depends on exactly the type of shop you go to but you can expect 1.5x MF pay (unless you were at Apollo) at the high end, and at least as much as you were making 2nd year on the low end
I literally just wrapped up recruiting for a seat at a good fund (was MF before) last week and this is what I got in terms of comp so I think its a reasonably accurate number
There is far more variance with HF pay than with PE pay even in the single manager universe so it's harder to compare the whole industry vs. PE, which is more commoditized at a junior level
Congrats on the new seat bro. As someone at a MF, my second year base is 190K candidly, would you expect from a base perspective the HF to pay out better from a base perspective or is it all variable-weighted so the base ends up being less?
Comp should be better in both base and bonus
probably count on one hand the number of funds paying 200k base for 25 year old analysts. 150 is the norm
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