Associate comp at HF?

I'm sure there is a lot of variation depending on different factors (size of fund, location, experience level, etc). But what would you say is a good expectation for compensation as an Associate at a hedge fund? What would be the typical split between base and bonus?

Edit: let's say 3-5 years out of college. Entry level at the fund

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Comments (41)

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  • Investment Manager in HF - Other
Mar 6, 2021 - 3:07pm

Entry level at funds will vary (as you note with size, strategy, headcount, etc). But in general (all for reputable firms, with experience, in an investment seat):

Lower end/entry level (if they don't value your experience): $125-200k all in

Mid (either top funds, or funds that will give you some credit for your experience - this is really what I would target): $250-350k all in

Top end: ~$500k

For multi manager places it is more like $100-150k base and bonus has lots of vol. 

For SM, for good funds but outside of the very top ones, in an investment seat with 3-5yrs of experience I would say more around $300-350k all in. 
 

EDIT: unsure why the MS, if someone has questions on the numbers feel free to share, but these numbers are pretty representative (from many yrs of experience). 

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  • Analyst 3+ in HF - EquityHedge
Mar 6, 2021 - 5:46pm

If helpful, my earnings arc has been the following since graduating college. First working at a top IB, and then working at a large equity L/S fund in NYC. All figures are annualized base + bonus + deferred. From convos with peers, first 3yrs were roughly in-line with avg for type / size / credibility of firm, and the last 2yrs have been decently above peer avg (personal performance driven). Comp volatility obviously increases the further out you go. 

Yr 1 (IB): $140k 

Yr 2 (HF): $275k

Yr 3 (HF): $400k

Yr 4 (HF): $1mm+
Yr 5 (HF): $1mm+

  • Analyst 3+ in HF - EquityHedge
Mar 6, 2021 - 8:28pm

Vast majority started out in IB or PE. Those who came from ER were generally more experienced hires (but didn't necessarily come in at more senior levels if that makes sense)

  • Analyst 3+ in HF - EquityHedge
Mar 6, 2021 - 8:59pm

So it's always difficult to give a meaningful average given event / performance volatility. But what I would say is I work a lot, and more than my peers at other firms (and even within my firm) since I'm in more of a risk-taking seat and on the young side in that sort of seat. The difference vs IB, PE, etc hours is that it's far more self-imposed and nobody is breathing down my neck on any regular basis. I do have a high level of flexibility on how I shift those hours throughout the week, and I rarely miss important personal events. The hours are more mentally taxing though, and you physically feel it a lot more than IB. Genuinely not a facetime culture at the firm, but a get shit done / high accountability culture.
 

In terms of specifics, I generally work 6 full days/wk, and ~70-80hrs/wk under normal circumstances. More than that around earnings and conferences, and less than that schedule permitting. Last year was obviously an anomaly in the markets, and I clocked in 100hr+ weeks pretty regularly, pulled multiple all-nighters, etc. Was a real throwback to the IB days... But again, it was less about someone breathing down my neck (we fared well throughout the periods of high volatility), and more about the volatility creating very rich opportunity sets that you wanted to work through as quickly as possible. 

Under normal circumstances, I'd say there's nothing precluding me from working 50hrs/wk. Just a personal choice. I generally enjoy my job (don't get me wrong, there are days/weeks that suck) and had a relatively unique opportunity to move into a risk-taking role early where the learning curve was quite steep and I have been front-loading a lot of the effort (TBD if/when that tapers down). It's been an unsustainable pace over the last 12mo though. 

Mar 7, 2021 - 8:44am

If helpful, my earnings arc has been the following since graduating college. First working at a top IB, and then working at a large equity L/S fund in NYC. All figures are annualized base + bonus + deferred. From convos with peers, first 3yrs were roughly in-line with avg for type / size / credibility of firm, and the last 2yrs have been decently above peer avg (personal performance driven). Comp volatility obviously increases the further out you go. 

Yr 1 (IB): $140k 

Yr 2 (HF): $275k

Yr 3 (HF): $400k

Yr 4 (HF): $1mm+
Yr 5 (HF): $1mm+

I'm guessing you cover tech?

  • Analyst 3+ in HF - EquityHedge
Mar 7, 2021 - 8:57am

Nope. I started out with pretty broad industry coverage that narrowed over time into now almost entirely focusing on one non-tech sector. Won't get more specific than that. 

  • Prospect in IB-M&A
Mar 7, 2021 - 1:37pm

Thanks for this! So you only did one year in IB? I'm assuming you used HH to get your current role as well?

  • Analyst 3+ in HF - EquityHedge
Mar 7, 2021 - 4:13pm

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Mar 9, 2021 - 3:52pm

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Total Avg Compensation

November 2021 Hedge Fund

  • Vice President (20) $488
  • Director/MD (10) $359
  • NA (5) $306
  • Portfolio Manager (7) $297
  • 3rd+ Year Associate (21) $288
  • Manager (4) $282
  • 2nd Year Associate (28) $241
  • Engineer/Quant (52) $238
  • 1st Year Associate (64) $187
  • Analysts (195) $166
  • Intern/Summer Associate (17) $122
  • Junior Trader (5) $102
  • Intern/Summer Analyst (215) $82