2021 S&T Bonus
My P&L doubled and my desk P&L up 150%+ YoY so far
Tier one bank, high yield credit desk.
VP. Last year total comp was around $200k. Do you think I can expect a 50% increase to $300k this year? Possible a 100% increase to $400k?
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I know it is a tough year. Bad year for many divisions and desks. Federal Reserve asked bank to curb dividends and buybacks so shareholders may not like a pay rise now. I also understand the pay is linked to supply and demand instead of performance. But can anyone give me any tips? Is your bank going to increase S&T pay this year? Sep and Oct is usually when companies make decision about high level bonus plan as new fiscal year starts.
Is your company going to pay S&T this year?
JFC VP total comp is 200k? Is part of it deferred? If not, I gotta got out to tech then
Banks are not going to pay bonuses, or very low bonuses this year. Loan book is in shit, too much bad press if traders get paid, and job market is very abnormal right now.
If anything, cuts in markets will begin in 2021
Depends on firms.
Tier one BBs usually don’t pay you well because they have a brand premium.
There are people willing to receive less to work for their “dream companies.
If you are junior, you likely to see higher bonus because your base salary is low. Usually as your base salary increases, the bonus decrease. There is a max compensation limit for each level in these firms. For VP is around $300k and for D/ED around $400k. For MD there is no a real limit, as a MD can be head of capital markets or just a desk head. To be a head of capital markets, you must be really good at playing politics.
Smaller European / Asian / Canada / Australia companies can pay you more, the catches are:
1. you must be very experienced, you are likely to be a one man team or work in a very small team
2. these firms very likely to leave US market suddenly without notice.
3. these companies likely to pay you more in first year through sign-on and guaranteed bonus, but not good at refresh
4. these companies lay off often. you get less job securities.
100% agreed with this
unless you are hired from another firm with pre negotiated offer, $300k is not really realistic for most of VPs. Usually after you work for 5 years, your total comp is going to be around $250k, then they will promote you to D/ED. Some firms will let go those VPs who didn’t make D/ED within a few years (up or out) to make seats for junior people, some firms you can keep your job but your total comp unlikely to exceed $250k as a VP.
Not just smaller firms, most of firms are really bad at refreshing bonus after year one. Sign-on and first year guarantee bonus is more like a bait.
It really doesn’t help to discuss S&T bonus without being specific.
Overall, nobody can disagree that mean and median compensation for trader is decreasing over years. It is paying well in many places, but not as good as they were 30 years ago. What gives me nerve is the trend. Am I get paid relatively well today? Yes. Will I still be able to get paid well after 10 years? I don’t know. It really sucks to be jobless with no other skill when you haven’t saved enough money to retire early. I will say $5 Million is the amount you have to have to retire around 40s. But it is not easy to save that much before you become jobless in your middle age. There is also not many exit options for traders to be honest.
In the end of day, trading pay is very volatile. A product could be good for a few years then screwed for many years follow on. You can’t really expect same level of pay every year.
I agree bonus is no longer linked to performance. My friends doing exotic fixed income in a big BB, very hard for him to move elsewhere. Not many banks doing these products anymore. So even though his desk made a lot of money, his take home pay is not so good.
Then again, you also see some desks get more automated, especially in on-the-run treasury and certain IRS products. It is still too early to say robots going to replace human jobs, but for some products it is already coming.
For the same product, your pay will vary depends on how your bank think of it. For example, equity derivatives desk in some BBs are focus on flow with strict risk management, so these banks usually don’t pay their trader well. These banks just deem trader as “human quoting robot”. Management in these banks think desk performance are more related to the franchise and risk management system , not trader skills, so you don’t get paid much for performance. But in some places, traders can do trade with less restriction, so their value is indeed being appreciated by the company.
How to tell what’s a good desk or bad desk? Simple. Increasing or decreasing headcount. More headcount usually mean that desk is growing for the bank you are working for. Less headcount usually means more pessimistic future in management’s perspective. Bonus allocation in any big banks is very political, so you have to align with management’s interest if you plan to stay that place for long.
Usually you have to be able to find compete offer to ask for a salary rise in a big bank. Otherwise, they will just tell you they already raised your pay, even a tiny 10% increase still count as a rise in management’s perspective.
When you said tier 1 bank pays you less cos of the premium of working for their brand name. Does this include GS too? I would have though GS pay is usually above other banks
My dp. One of six biggest banks in US.
Equity derivatives. Year 4 VP, last year total comp $230k.
Was told by boss total compensation expense for S&T is around same but headcounts increased as we hired a lot of quants and strats.
Bonus is no longer tied with my performance. Nowadays bonus is more about market demands. With market demand low, trader job is no longer exclusive. My boss told me that many quants supported us want to become trader to learn about trading, and they don’t care about the pay.
Even worse, my company want to reduce overall trader headcounts in next several years like our competitor did.
Holy fucking shit. Buddies in IB got paid that last year as junior associates
I echo the above poster. Were you a VP last year? $200k comp seems very low. Heck, I was under the impression that VP base was 225k, or around that ball park.
S&T base is generally a bit lower than IB. For example, associate 1-3 is $15k lower base across the board. I believe it’s $175k base for VP as far as I know, although it could be dependent on the bank.
In terms of bonuses this year, I reckon about 15%-30% of base regardless of individual performance, with some unlucky folks getting goose eggs. The $10k bump in base salary will be your bonus. My bonus has gone down as my base has gone up every year, so I don’t care much anymore. I’m expecting a token $10k bonus for my associate 3. When the bonus has become such a small percentage of overall comp, it doesn’t work as an incentive anymore.
What product do you work with? and is it trading or sales?
Thanks.
175k to 200k is base salary for most of VPs. Department of Labor does publish salary for foreign workers who hold H1B visa, you can Google that online. It is real and trustworthy, because bank won’t pay your base salary differently based on your nationality,
175k is the standard VP base nowadays.
150k base for Aso3 bump to 175k VP1?
Would be very insightful to hear your data points for prior years.
I am in a very similar situation to you and similar rank. Having a killer year in every possible regard. Last year my comp was similar to yours in the range of 200k-250k. For those questioning how low it is, that's just how it is these days (I know quite a few who got way less last year).
Personally, I'm expecting something like 25% to 50% increase from last year (definitely nothing near 100%, best possible case 50%). I wouldn't get hopes up too high given circumstances. IBD is probably looking at 0s across the board.
But S&T overall would think will get slight increases given they were the only ones to make money (and basically save bank revenue), but nothing spectacular given overall bank performance and recent trends of declining comp overall.
Yeah I hope a slight increase too but I don’t have much hope.
my company is also cutting people, not my desk but other trading desk. Earlier this year , CEO said he won’t lay off anyone this year but he changed his idea recently.
Also, looks like there are a lot of buyside traders lost their jobs this year, they want jobs so badly make trading head joking our bonus is still having a job.
Sales or trading?
Which products would you say was the best performer this year? I would assume equities because of the extreme volumes we saw in Q2?
I think a 6% to 10% total comp rise is possible. they may add your base but won’t add your bonus much. anyway, the upside is to become a MD. It makes a lot of difference once you become MD. But to become MD, as other author said, it is more about politics than merits.
I have been thinking start my own one man fund trading futures. I saved half million so far and if I ever lose my job I will do trading at home. It is still a good market , just companies don’t want to pay you.
Bump
Can someone give some color on S&T salary progression? $200k all-in for VP seems extremely low...
Despite some comments above, I still think its low. But it will vary a lot by desk.
Generally speaking, traders take home more than sales guys. Will also depend on how well the group did, your individual performance, etc.
I get that base might be $175-200k but makes no sense that traders in top groups get nothing above that if the team did well.
Heck, MD who’s a mentor of mine told me her first years got $40k last year.
This year an associate at my desk came to the office with ferragamo shit he bought for some people after bonus was paid. Not that it means a lot but doubt you’d go spend a couple of K’s on a 10k year bonus. Which becomes 6k after tax. Granted, he’s really good at his job and its a good team in general.
For VP yes, 200k all in is on the lower side, but it is not out of the ordinary. But as one of the above comments pointed out, your upside isn't that much higher (300k-350k in a very good year where everything has to go right including bank performance).
VP in sales/trading is still technically "junior" especially your first year or two, not like IBD. Each year your salary should get a bump during these years until you hit VP - there was an earlier comment that your bonus will likely stay the same (or even decline) as your base increases in most cases. Typically for junior levels is something like:
90k-100k Analyst base - all in 125k-175k
120k-160k Associate base - all in 150k - 250k
175k VP base - all in 200k - 350k
It's when you become "senior" (Director level) when the bonus is no longer "capped". Regardless overall, S&T comp has trended lower year after year. In the past the real upside was the senior levels in S&T, but that has changed and will continue to. You can't really compare IBD comp to S&T comp at lower levels outside of analyst. If you want to feel better, IBD also works almost twice as much hours in some cases.
Juniors usually have higher bonus lower base.
As you move up, base increase, bonus decrease, overall package increase.
I got my biggest bonuses as analyst 1 and 2. While my overall comp has risen since then, bonus has gotten slightly lower overall. I made the mistake of thinking that higher base means higher bonus, but this isn’t the case in S&T until you’re a senior VP or a director. $100k+ bonuses are quite rare unless you’re in a great seat AND you have a great year AND your desk has a great year AND your overall division has a great AND the bank has a great year!
This year doesn’t look good. So far besides Citi other firms don’t have plan to increase compensation expense.
I think Citi will have to increase bonus given many of its employee worry that it may become next Wells Fargo or Deutsch Bank. So they need to spend more to keep its traders.
Looks like most of companies didn’t increase their accrued compensation cost much so far. Headcount around the same from last year. That means less pay for each person.
Why is Citi the next DB or WF?
Why is Citi the next DB or WF?
I suggest everyone watch Q3 bank earning.
Look ahead Q4 estimated compensation cost still didn’t increase
Looks there aren’t so many buy side jobs this year, hopefully next year job market come back and we can easily find a compete offer.
If you look at Q3 earnings, salary expenses and pay per head have gone down. Net income and ROE have gone up, so all those extra earnings are being paid out directly to the shareholders instead of employees. If banks were planning on increasing pay we’d see an increase in costs, while costs have actually gone down. Now not traveling and less entertainment has certainly reduced costs, but it wouldn’t account for everything, so the rest must come from reduced pay.
Agree. Companies pay you purely based on market demand instead of performance.
In particular, for many niche products, you make a lot of money but bank won’t pay you. Because there are only a few places trade it so you don’t have much job mobility neither.
I wonder why all first year analysts on this forum think $200k comp is too low for VP trader, are they expected $600k like good old days? lol.
Well, they look at the few individuals that do make that comp and think they’ll be those individuals. While in reality there is a bit of luck involved. You have to end up at the right bank in the right seat at the right time, and perhaps some folks above you leave so you can get promoted early or take over a book.
S&T pay can be higher than IB pay for the lucky few, but the median pay is much lower than IB pay. The $300k associate and $500k-$600k VP you often hear about are relatively non-existent in S&T.
I think we’re no longer fairly compensated for the risk that we take. Everything we say and do is heavily scrutinized by the regulator, and there’s a real personal risk involved with that. Moreover, our career path is very uncertain and can come to a quick stop without much alternative. For $150k-$200k it’s much better to work at a corporate where none of that risk exists.
Basically, the risk/reward is skewed against us. Having a great year doesn’t necessarily mean much anymore on the upside, while on the downside there are many career or at least bonus ending risk events.
Perhaps a way to think about it is that back when I started I knew associates and VPs that drove sports cars like Lamborghini/Porsche/Aston Martin or luxury cars like a Bentley (gently used often, but still), while these days nobody below MD has a car like that. The fact that nobody can afford those frivolous expenses anymore means comp has gotten tighter. We’re in a secular downturn.
100% accurate...
Well said. I like reading your posts.
In my case, I'm biased by the IB salaries I see here all day. So maybe that has set my expectations too high.
industry is screwed, every year comp decreases and markets aren't as interesting as they were
This is very true. But consider also that who is really trading now? Speaking for my side (Oil major) there is very less real trading and way more just execution
Used to work in S&T for an IB and that was even less attractive in terms of risk taking
so the question is, who is taking risk for real now? who is willing to let their traders take much risk without annoying them with useless metrics like VaR or similar stuff?
regarding these cars is a funny yet important example. i see some seniors here having a Bentley continental or Aston, but is legacy stuff I'd say
Good VP traders that know how to speak up make $300k-500k easy.
Trader is going to be a normal job like many other bank functions. No longer a lucrative job unless you trade your own money.
Another data point: GS pay per head has gone up 16% in Q3, but if you look just at S&T it’s only 2% despite record performance. Pay is no longer as correlated with performance as it used to be.
Anyone else peep that BBG article today about traders taking home a smaller slice of the pie this year... sad!
AO1 FICC trader - was told by head of cap markets 35-50% bump in bonus, so like 80-100k here...have to imagine comments above are mostly flow seats which pay like shit.
Depends on firm. Foreign banks and smaller banks are more flexible in compensation but there are many downside.
As someone mentioned earlier, Citi said they will pay more this year because Citi is not doing well,it is on the edge of becoming next Wells Fargo or Deutsche Bank. They need to pay people more to keep them.
I personally know other traders at Citi/MS in FICC as well and they’re rolling in it too this year. I think if you’re a bookrunner/arb and you perform, you get paid because banks NEED us. If you’re not new issue and trade flow/secondary you’re a dinosaur to most banks, hence the lower comp.
My firm said they are going to increase compensation cost but my boss told me it will mostly go to seniors and MDs. Don’t expect too much if you are not a MD.
What’s really ironic when you think about it is that traders are supposed to be good at managing risk / reward - but given the extremely poor risk / reward of the job itself, doesn’t it make you question the risk management capacities of anyone who sticks around in the job willingly? 🤔
Don't think there's "extremely poor" risk/reward in the job itself. Just think it has become more balanced in that regard.
Years ago basically everyone would become wealthy in trading. There was all the reward and virtually none of the risk.
Traders used to get paid more because there are more companies compete for talents but now the market is heavily monopolied by a few big banks. Hopefully we can see an anti-trust on big banks to break them apart in a few years so more jobs will be created.
Traders want to make themselves irreplaceable but banks want the opposite. Traders think they are doing good jobs in risk management and profit but bank think risk management from their system and risk rules while profit come from their platform, flow and full service abilities .
Traders think they can still make big money after leaving the big banks while big banks believe without order/information flow and cheap capital, trader won’t make so much money.
If you work in a bank, no longer how hard you try, banks don’t even speak same language with you. Banks trying to make you less important and easy to be replaced but you want the opposite.
To get things even worse, nowadays MD who get promoted more because of nepotism and politics instead of merits.
That is true for every company.
What company doesn't want to make every employee replaceable? That's just how capitalism works.
Monopoly is a real problem nowadays
It is an issue. When there’s effectively only 3-4 other employers out there and a number of sidelined people are willing to jump back in for low pay, there’s no need to increase pay. There’s no competition for S&T roles and headcount continues shrink.
For IBD, there’s tons of smaller shops and boutiques that are willing to compete on pay to perhaps make up for the lack of brand, and consequently help rise everyone’s pay. They can also somewhat easily go to PE or a corporate development role.
The same goes for a tech. It’s a growing sector with more demand for employees than supply and lots of start ups and smaller companies compete with FANG on pay.
Hmmmm, this is all very gloomy.
I am in a top BB in equity derivs.
I got around 400 vp1 and around 500 vp2, arguably these were very good year, but i know for sure i am not some massive outlier, more on the higher side though.
This year is quite dreadful so i am expecting a decent pay cut. Several directors who are head of sub-teams make 800-1m+ in good years.
Fixed income pays more than equities from what i hear.
While i agree with the mood here, 200k seems a bit low if you are on a successful desk
Based on your ID, I imagine you were year one VP 7 years ago?
Companies changed a lot over past several years. I will say the dislocation between performance and compensation happened after 2018. 2018 was a good year for many desks but not compensation.
What happened in 2018? More foreign banks leave US market, more funds liquidation, more winners take all. Industry become more concentrated. Nowadays for most of OTC products, no matter liquid or illiquid. Top 3 players account for almost more than half of market share. Cost of operation like technology is ever increasing, make it is no longer economically viable for smaller competitors to stay in the field.
Why people think things will get worse? More industry concentration.
In equity, Citadel and Virtu is keep buying their competitors while in FICC, more players exit the market and let top banks pick up their market shares.
This all sounds great to company management and shareholders, because competitive advantage then become scale and platform instead of individual merits. But it really sucks for traders since essentially there are less companies you can work for and company will no longer value you that much.
$200k - 300k for VP and $300k - 400k for D/ED is what happened to most of people after 2018. We do give new people from outside more than that number but usually through a large sign on bonus.
Overseas situation is different, Hong Kong office get paid more as relationship still matter a lot in Asia so companies need to keep people with strong relationship. In Asia, lot of things are grey but in US regulators are making market become too transparent and they want more transparency!London office get paid less due to overall disappoint EMEA performance.
The good thing is, compare to EMEA, US pay is really not that bad even it has been decreasing for years.
Automation is not a real threat for traders, industry concentration is. Especially for fixed income traders who can’t trade their product at their own at home when no one is hiring. It get even worse for fixed income job space once low yield become a new norm.
I know a lot of funds still think US will see negative interest rate in 5 years because of huge debt, just like their European peers. Looks what happened to European markets after negative yield. It is totally screwed.
Equities are no luck neither. Citadel / Virtu will only grow bigger and take more market share. Smaller players will fail and more people will lose jobs and create a huge oversupppy of job market
No, my ID is Bullshit. I was made VP 3 years ago. I am VP3 now.
I do agree it's getting worse and worse... And i definitely know VPs around 200-250k but i though they were kind of screwed or not very good to start with.
I miss good old days. In 2013, average performance VP in my firm could take home half million. Top performer could take home a million. Nowadays even high earner get paid less when compare to what they were paid 10 years ago.
We had MD trader who made more than CEO in good old days. In good old days, bank CEO all from sales and trading but now , banking.
In 2013, we still have prop trading desks.
In 2013, market was not so transparent, and not so many stupid reporting requirements by regulators.
2013 was such an amazing year.
I am willing to do anything to bring good old days back.
Do I still make more than 95% of people in NYC? But I am afraid the trend will get things worse in 10 years.
Did I mention risk control? There are so many risk control requirements nowadays, more compliance training.
Fed can print infinite amount of money so why should walls street care Main Street? I hate all regulation. Just remove all regulation, it is White House responsibility for Main Street not Wall Street. If another systematic risk event happen, just print more money. If one day unlimited QE failed and US economy no longer work, you have money, so you can always move to Singapore or Virgin Islands whichever is nicer. Leave the dumpster to someone else.
This year Fed is doing too many crazy things by improving capital requirement for banks. They shouldn’t. If bank failed, just bail them out with unlimited QE.
Most of Wall Street people don’t really care about nationality, as long as you have money, you can be citizen of any nice countries.
It is the nature of capitalism that companies will get more pricing power and workers will pay less over the time. Have you ever played monopoly?
People here are sad because they are not capitalists just workers. In a capitalism society, worker’s value is to be exploited as company grow bigger and stronger.
Then again, many fund managers say we are likely to see WW3 in this century. At that time, money is no longer important.
Am I the only one noticing most of the doomsayers are new accounts that speak in the same subtly broken English? This smells mostly like troll. If you want a realistic negative view of the industry, I would listen to koalamacro, if you want an average view of the industry, look at Coconut1983. This thread is just some fearmongering/concern trolling by some sketchy accounts.
For people with experience in the industry, do you have the same pessimistic view of prop trading / hedge funds, or is the gloomy outlook somewhat coming from the fact that banks can't prop trade and are extremely heavily regulated? Do you see a sustainable career path for people that make it from S&T to the buyside? Of course I know that's a fraction of bank traders, but from my understanding the comp at HFs hasn't changed much over the past decade, at least in rates, (although it's still well below what it was pre-crisis), but I've only had ~3 years experience on the buyside (and never worked at a bank) so don't have much perspective myself.
I worked at a bank until 2017, and have since been in proprietary trading. Market makers aren't going anywhere and their role in markets is expanding. For starters they are simply doing more things, eg starting up large institutional sales desks and getting into traditionally bank-only markets like credit. But you can see it on the comp side as well. Every time I see a new college grad compare quant trading offers I'm astounded. 200k+ is common and you occasionally hear of ~400k all in out of college comp when the candidate has competing offers. This isn't only a first year bump though, and some compensation structures are really transparent. Take the Dutch market makers like Optiver, for example - bonus pools function as profit shares so when profits increase (and they are publicly published everyear), bonuses scale up linearly. Volatility was super high this year so it's an understatement that it was a good year to be a market maker.
A lot of these places will hire laterals, so you definitely can do S&T -> marketmaker.
Could you expand more on how difficult it is to lateral to prop shops from S&T? I'm a junior who will likely accept a BB S&T SA offer, even though I am interviewing with a top prop shop, because I honestly don't think I will pass the later interviews without a lot of math prep. I know that it's much harder to get into S&T FT without an internship return offer. How much harder is it to get into prop shops without that junior year internship? I'm thinking of taking the S&T this summer, and maybe studying up on math so I can apply FT for prop shops if I don't like S&T, or even lateral later on in my career if I do S&T as a new grad. How feasible/common is this?
The multi-managers like millennium are growing and continue to raise more money, while smaller funds continue to shut down. Millennium has a great business model which is amazing for the fund, but the individual pm’s are dispensable.
you can still make good money at these mm’s if you do well, but the reality is that it isn’t sustainable,90% will be gone within 3 years. Even if you string together a few decent pay days, (400k, 600k, 2mm, fired) it doesn’t look that great. MM’s are a great option for MD’s who have enough savings to retire, but not if you still need income
Industry is consolidating across the board, and if you get fired from millennium when you’re 37, good luck finding another job. There’s a good chance you’re going to be at a broker or selling fintech software for 80k +commission
once again, the issue isn’t whether banks or funds make money, its the outlook of surviving 25 years For a full career, and the compensation for the career risk. it used to be easy to bounce around to different funds and desks, now getting fired is a career ender where your only exit op is retirement
That’s been my point from the beginning. The risk/reward is off and most folks don’t want to think about what they’re going to do when they’re 35-40 and get fired or made redundant. It’s unlikely they’ll have made enough to retire, and for most people it’s right around when they’re starting families and costs go up. It’s a high risk/medium reward job. At this point I think a regular corporate job where you slowly climb the ladder is much better.
wonder the same thing. is grass greener on buy side?
I am also around $200-$250k after working 3 years. Equity derivatives.
Trying to move up but so hard. P&L is good but my boss just doesn’t recognize my work. He think it is all because of the established platform.
You made VP in 3 years?
He might be right though - any compelling reason it isn't because of the platform?
Get a bid and have them match or leave, the only way to get paid in this business. Loyalty is not rewarded, it's taken advantage of.
Still better than me. Knowing that US immigration policy is tightening, my firm become more reluctant to pay foreign works who need a work visa.
Trump admin is a troll by limiting working visa.
What's the perspective on quant funds? It seems if things do not work out, you could always exit to tech where compensation is pretty good.
Quant funds are good opportunities but with any position where your main value is as an individual contributor your ability to move to high paying jobs elsewhere will be limited. HFs can be great, but in many places (and especially MM pods) you are paid for your ability to find alpha and manage your risk. You aren’t really paid for advancing technology, building new stuff, managing a team, figuring out new products, it is just “did you make money with the appropriate risk controls?”
So people at quant funds will definitely be exposed to tech, and be more likely to move to tech (generally capable with technology, coding background, etc). And tech at many levels is comparable (in terms of high paying for individual contributors), but the very senior roles know how to run teams and build out the organization. That isn’t something you’ll get at most funds, so you’ll have exit opportunities just not the super high paying ones (just “regular high paying”).
The stuff posted here seems a little too bleak imo. $200k all in is not typical for VPs (many have this as a base) and a cap at $300k/$400k for VPs/Directors also seems atypical.
I work in markets and made $210k, $225k, and $245k as an associate 1-3 and $175k base now as a VP 1. I don’t think my comp has been significantly above average.
I think less pessimistic expectations would be something like
VP 1 $265
VP 2 $295
VP 3 $325
I also am pretty sure that the directors are not all in the $300s, I think $400s is typical and some are definitely significantly higher.
The industry is definitely getting more difficult and less lucrative but some of you guys are pretty underpaid imo
Are you in sales or trading and what desk are you on? Did you join out of mba?
I don't want to be too specific because my desk is pretty unique, but I'm considered to be a structurer. I was promoted from analyst.
This seems about right for a solid performer in a decent group at a BB. There are also always some people who will get donuts and some people who will get paid significantly better than is typical for their title. I have seen the latter happen for people who were hired straight out of university who are in their late associate/early VP years who don't have enough years of experience to get promoted to the next rung yet but are strong performers. e.g. associates who should be VPs and get 300-500k total comp. You also see more experienced VPs who are really strong individual contributors and get paid for it but for whatever reason (politics, group structure, etc.) haven't been promoted.
Not very value-adding, but I'm starting at a T3 bank as an SA in 2021 and this just depressed the hell out of me.
Its natural not to know what you want to do when you are in college but if you have doubts go IB. Its really only a 2yr deal and then you can move on to something else. The people who succeed in S&T have no interest in IB and would never even interview for it. In my experience the people who interview for and get both tend not to do well if they pick S&T. The work, the pace and the people could not be more opposite.
Not sure where you all work but VP S&T all-in comp should be $300-500k or else you're getting underpaid. Get a bid and realize your value and then make your bank match or leave. Base salary is usually in the range of $175-250k (unless you work for some of the bulges whose upper bands is c.$200k) and bonus should be at least $100k if the bank/desk/you have had a good year. Bonus pool at Jefferies is +25% this year and a high performing VP in S&T is set to make c.$400k, that also includes sales, not just traders. If you are making below $300k as a VP in S&T the issue is your performance or refusal to realize your value elsewhere, and the bank will take advantage of that and underpay you, as they should.
For some products, especially those exotic derivatives trader, it is really hard to move. It is a really niche skill, and most of places don’t do it nowadays. The career mobility is really bad.
It is so hard to switch jobs nowadays for people who need a work visa. Trump administration is extremely anti-immigration.
Does anybody have any color on equity derivatives pay?
Is it good? avg? bad? In relation to other desks, I mean.
thanks.
Really depends on firm. If you are in a flow desk then pay probably not really good, but if you can work in a prop desk then probably better. BNP for example is more close to prop than flow. Foreign banks are exempt from Volcker rule. They also have less capital requirements. That’s why in general they tend to pay you more compare to famous BBs
This thread is ridiculous and shows me why you’d have to be a total idiot to work in s&t
care to elaborate? lol
It’s so competitive. It’s a dying industry. And you guys get really fucking small bonuses.
Anytime I meet someone that works in s&t at a bank I generally assume they are incapable of doing their own research or thinking for themselves. If they did any reading they’d pretty quickly realize it’s basically one of the worst deals imaginable.
Hey! Your fucking stupid :)
The difference between this thread and what the industry was like in 2006 is crazy.
Wait for biden to come with his tax hammer and it won't even matter if you make 700k.
As usual people who are already wealthy are not impacted or get richer through asset inflation.
Poor people get handouts.
And high earners get stuck with the bill. These salaried high paying jobs make less and less sense every day.
Either live some chilled life with a reasonable job, or create your own company.
Yes! I feel it is crazy how people are brainwashed to vote for Biden!
Trump is the better person for banking industry!
He supports lower tax and will lower capital gain tax in his second term!
He supports deregulation which will allow prop trading!
He supports restricting foreign workers which means more job opps for American!
I found this article today: "We earn >$700k. We can't afford to live in NYC under Biden"
Can you imagine? No matter how much you earn, you will be get penalized just because dem people think you are rich! Crazy thought!
Trump four more years!
Sounds like that won't be a problem for most of the S&T industry based on this thread.
Creating your own company is not easy as the world's problem right now is insufficient demand (obviously, now even more of an issue with covid). There's too much produced by people with their own companies compared to what people need(mostly in East Asia and Northern Europe). What makes starting your own company seem attractive is the massive amount of asset price inflation spilling into private markets and hence startups. Don't get me wrong, at some point in my life I want to have my own company(-ies) too but it's not like someone will necessarily buy your siht if you make them right now.
As far as the topic comes - this thread is way too negative. In my ex-bank (BB in London) you can add 20%-ish to the numbers here. That said, a lot of people do get fcked with pay. Also, my bet is that the thread's numbers will be true two-three years from now.
Right, why work hard to make big money if most of them go to pocket of IRS?
I find a lot of the numbers in this thread a bit surprising. I work on a credit desk as a VP2 base of 175k and would expect bonus of 375k or so this year ( good year but not ridiculous).
the largest producing directors/mds on my desk will be easily clearing 1-2m and maybe a little more for the stars.
Pay definitely getting more varied depending on the desk, I.e it’s going to be hard to make much on a spot fx or cash equity desk.
I am a VP in cash equities desk, do you have any suggestion on how I can move to credit desk? Tried to network internally but they prefer hire from outside. Cash equities pay is terrible. There are only a few desks in the bank pay well, if you are not in those desks you are cursed. But everyone wants to move to those desks. I tried to move out from cash equities so many times, so far no luck. I want to make 200% bonus too! Any advice will be appreciated.
What are the desks that pay well in your bank?
I'm curious, how do you balance your relationship with your current desk while reaching out to other teams? Do your coworkers know about your intention and move? In a similar boat but I'm very concerned and unsure of how to approach this situation.
Yes it is possible. Some directors on my desk are easily above 1m$. But more and more, finance is starting to work like random company. So less direct link to PNL. You just get paid based on supply/demand, which then demotivates you, so you produce less, so you are even less in demand.
Reality is just that pay will be lower and keep getting lower. Each of you just needs to decide if it's still worth it.
Basically a lot of good VPs in top banks are stuck in a desk with lots of directors with overlapping responsibilities. There will be a lot of dead weight, but comp doesn't adjust down that much, so even if you are a top VP and the director is doing fuck all, if the desk PNL isnt growing significantly, desk pool is flat so you still get the BS raises of 10-20%, because you are subsidizing the comp of older directors that are not really delivering as much as they once did, and management is too lazy to take hard decisions or upset anyone unless they are forced to as long as things are sort of working.
And the less they deliver, the less good they are, and that means they will never get a bid from elsewhere and free up space.
So you are just there hoping to work for the star director that will get promoted to head of the desk so you can step up, or for some big round of layoffs to make the boat leaner. And you could be waiting for 5years with nothing happening.
Getting an offer from elsewhere can help to "unstuck" the situation, but the industry is shrinking so its not like there are dozens of top jobs going around.
Put pay aside, how do you think the job mobility and career upside of sales trading? How easy it is to become an MD in sales trading?
You miss the point. Politics is very important in a big bank. Those directors will stay because they usually have deep connection with some senior leaders. Senior leaders also need them to get rid of some people who may be a threat. You are still too young to understand politics in a bank. For those people who are good at politics, you can easily make someone miserable, and disappear from industry. Those directors don’t need to be good at trading, they just need to be good at politics.
Don’t be naive. This happens at every large companies.
This is more inline with what I’m hearing. I’m associate 3 / getting promoted this cycle. I think maybe the disconnect is in order to make real money you need to be on one of the desks that’s still interesting. I would think it’s something like the below...
Very Good Pay / VPs break 1mm if good: securitized products, credit derivs, macro derivs that aren’t vanilla flow, high yield or distressed credit, legacy prop desks and other small niche desks that aren’t well known
good pay: IG credit, flow macro products where you take prop risk
numbers everyone is quoting above: equities, sales, sales-traders, any flow desk where you’re not adding decision making value or taking real risk
Mostly agree, but also depends on the bank a bit, more and more banks are picking their spots a bit in terms of where they are allocating resources. Some banks have a great macro business but a weaker HY business and vice versa. In general it seems that anything with a lot of new issue is paying better than things without a lot of new issue.
Where would Munis S&T fall under this? Bid/ask of 5-10bps for 10mm bonds still pretty common (same P&L as trading 100mm corps for 1bp spread for example). I feel like Munis is a niche area that I wonder how well they get paid..
Congratulations to Donald Trump on winning the US presidential election again!
Thanks to president Trump, bank stocks are soaring today!
Say no to bank regulation!
Say no to tax hike!
Say no to foreign banker and trader, they are stealing American jobs!
Keep America Great!
What’s the comps like for rates VP1 in JP/MS/GS?
These numbers seem insanely low to me, personally. I have decent color on Associate 3 and VP1 and VP2. I know Associate 3s and VP1s who were top performers and admittedly had their own P&L to their name but made 600k and 700k last year, respectively. They had good years but nothing amazing like others have mentioned. These are all people at tier 1 BBs but still. I think VP range should be something like: 300k low end / bad desk, 500k if you have decent P&L to your name, 1mm if you're a rockstar and made substantial money (20mm+) for the firm. The ED/MD numbers are also insane. EDs on desk that make good P&L where they themselves make up a high percentage of that P&L are easily clearing 1mm, and MDs on those desks should be over 2mm. All of this is specific to Fixed Income traders (not sales), but still.
What do the numbers look like for sales?
I don’t have as good of color there but definitely much more “capped”/flatter distribution. I’d think 3rd year sales associate is like 230k-330k. There’s just much less ability to shine in sales until you have your own accounts that are doing size, no matter how talented you are.
It's much easier in trading to get direct P&L linked to your name earlier in your career than in sales. Some trading desks have 10+ people on them all doing different things so its not that hard to find some low risk small book for a good junior person to trade. This frees up the senior traders to focus on more profitable trades and is a great way to test the junior guy to see if he is any good. If you do well with the small book you will get paid for it and will get more responsibility.
In sales teams are generally 2 or 3 senior people with an analyst (an IG sales desk may have 10 people but they will be split up into smaller teams), and while each account will have a primary person the others are there to back up when that person is out or occupied with something else. Logically after proving yourself you would get to be the primary coverage for a couple of smaller accounts in the book so those senior guys can focus on the larger accounts and that does happen but those senior guys are in all the chats and watching everything you are doing so you don't truly "own the relationship" and the accounts you will be primary on are so small that no matter how well you do you are not going to get paid for it. So in sales you are sort of waiting for someone to leave so you get to be "the guy". Sometimes you catch the right breaks and you become "the guy" early in your associate tenure and other times you don't get it until later in your VP years. Also there is a relationship element here and management seems much less willing to shake things up on the sales side than on the trading side, you see some senior sales people who suck and don't work very hard but because they cover one or two important clients and management is happy with how that relationship is going they won't rock the boat.
Here is what I have seen in fixed income, I think this is decently accurate.
Analyst- 125-175K
Associate- 200-300K
VP- 300-500K
Director- 500K-1MM
MD- 1-3MM
Do you know how can I get into one of these more profitable desks? I found once you became VP, you basically stuck with your desk. So hard to move to those big $$$ desk, not many people there so no occupants. Do you think that if you don’t get into these desks at junior level, you will not able to get in after 30?
It is very sad even those desks paying $$$ no longer need that many of traders compare to pre 2008 time.
How’s the rates desk? Is it one of the desks still growing?
I’m currently in banking Securitized products. Curious on the trading side how much a mid-level associate (2nd yr or so) and 1st yr VP should expect to receive at a BB that excels in the Securitized/structured credit space such as JPM/C/BoA?
how much do you make? i'm a 1st year in structured products within banking and would like to know thx
Any numbers for London?
Wow, looks standard deviation of sales trading compensation is huge! I imagine the $$$ of sales trading a fat tail distribution. Most of people don’t get big money with some outliers get huge pay. The skew of trader pay is probably the highest compare to any other industry.
I think the problem with sales trading compensation is standard deviation vary too much. Same desk in different banks performance can vary differently. I see most of people compensation around 200-250k for a VP trader. However, you will see people who make much more but they are like top 10% or so. Many of these people are just lucky to end up in a good desk (for each bank, good desk is different).
The even bigger problem is those desk make a lot of money are not growing so they are not hiring. If you can’t into those desks (which is really not that much), you are screwed for rest of your career.
Is sales and trading a shrinking industry? Of course. Because good desk doesn’t want to grow its headcount. Why? Because business is not growing so headcount is not increasing.
If you don’t agree with me, tell my why all good desk like high yield credit doesn’t want to grow its headcount. The truth is they know if they grow headcount they can’t keep high bonus.
Technology is much better a career choice. Google’s always hiring but high yield desk is always gate keeping. Not increasing the headcount. There are many smart interns but in the end, hiring is more relationship based. If hiring manager is Jewish/Indian/Chinese, they hire people of their own race. And girls don’t get opps because it is a bro club. That’s why most of people in that desk are guys.
How’s the comps like in Japan for FICC traders compared to NY and UK?
https://www.bloomberg.com/news/articles/2020-11-12/traders-poised-for-s…
who cares about well-verified facts when you could listen to a few disgruntled subpar exotics vp trolls instead?
That's the vibe I'm getting from these comments.
Hope you don't work at BofA:
https://seekingalpha.com/news/3639378-bank-of-america-proposes-flat-bon…
The rest of the BBs will follow suit.
Google this article “Banks that probably cannot afford to pay big bonuses this year”
BONUS vary by banks
Nobody here really understands how bonus is actually calculated.
I will tell you, it’s simple - politics.
If head of trading is from credit background, then he will give more money to credit traders, especially those people who have close connection to him. If head of trading is from mortgage, then MBS trader get paid well.
In fact, he may even let a credit trader of his ally manage a different LOB, like rates.
What is the most important thing as head of trading? Keep your job. How to do that? One important thing is to make your people hold important positions and treat them well.
whats a good ST role to get into as a current M&A Ib guy. I cannot handle the powerpoint/deck churning, and PE seems like banking 2.0
100% serious.
Don’t worry about bonus. The massive layoff is coming in next two years!
Dude shut up already. Quit spamming every s&t thread with this garbage. GS is cutting 1% which brings them to a total cut of 2% for the year, and it is not just s&t. They cut every year this isn't unusual......
You were right! This guy fix incomes! Yield curves were inverting heavily from 2018 and the Fed just pumped money to hide the problem.
Why waste time discuss sell side bonus? They all suck! Join buy side, you will make ten times more, like at least 7 digits if you are good. If you can’t make that figure in buy side in 5 years, that probably means you suck and shouldn’t even stay in this industry! You ware wasting everyone’s time!
This made me "LOL" :)
I would bet a decent amount of money that you are a college student, or trade options in RobinHood and have your LinkedIn headline as "Leveraged Non-Linear Product Prop Trader at Family Office" - when your Family Office's AUM is the $1,200 stimulus check.
Any news on bonus pool this year?
Better than you’d imagine
What's the common range comp. (base and bonus) for a 1st/2nd/3rd year analyst on a FICC trading desk (NYC) at a European BB?
Sales Trading still make a lot.
My uncle is a doctor graduated from NYU Medical School, and he only makes $300k a year. My friend in sales and trading make more than that after working for 10 years.
At what level in s&t?
From Bloomberg today -—-
Bank of America Corp.’s leaders are planning year-end bonuses that break with Wall Street traders’ hopes for hefty raises after a record-setting run.
Senior executives are floating plans to keep the bonus pool for sales and trading at last year’s level, despite a 20% jump in revenue during the first nine months of this year, according to people briefed on the talks who spoke on the condition of anonymity.
Told you so
VP2 at the London branch in a big prop shop
market maker in FICC
salary: 150 GBP moving to 165 next year
bonus: 175 GBP
pnl was up > 100% across the board but total comp increased only 25%
Hello all.
does anyone have any indication of what I can expect in bonuses for 3rd yr analysts? I am based in LONDON. and work in SALES at one of the BB European IB. I will be promoted to Associate this bonus round. My prev is completely is as follows:
AN1: £50 + £15k
AN2: £55k + £25k
AN3: £60k + ?
I'm VP1 and TC is 275K USD. I'm not with top BB.
TBH I never worked for sell side S&T before so I think the TC is fair. I'm curious to see how much more I could earn if I stay in the industry for years.
What did you transition from? Are you in sales or trading?
I was with buy side.
what's your base?
175K, seems to be a standard nowadays based on above comments.
Heard Canadian banks will pay well this hear
Also hearing CAD banks will generally pay well this year. I'm a fixed income VP1 at a bank in Toronto. I'm a toptier performer, though my team's book didn't do great this year, but I still made C$345k all-in up from 200k last year.
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