HF Comp Table -- H / S

Ravenous's picture
Rank: King Kong | 1,521

I remember seeing a compensation table a couple of weeks ago for first year compensation for students who went into hedge funds coming out of HBS and Stanford. Table had info on base and bonus break down. I tried 5-6 searches and can't find it. SB for anyone who can post the link. Thanks.

Comments (10)

Jan 11, 2012

HBS has statistics for its class but it's only base/guaranteed comp:
http://www.hbs.edu/recruiting/mba/data-and-statist...

Jan 11, 2012

+1

That's not the one I saw before, but that is helpful, thanks Kenny. I assume the Stanford numbers are basically the same.

Is $320K all in really a representative number? I would have expected it to be higher, maybe closer to $500K all in -- is that a ridiculous figure for an experienced hire (non-career changer) with CFA + MBA coming out of H / S / W?

Jan 11, 2012
Ravenous:

+1

That's not the one I saw before, but that is helpful, thanks Kenny. I assume the Stanford numbers are basically the same.

Is $320K all in really a representative number? I would have expected it to be higher, maybe closer to $500K all in -- is that a ridiculous figure for an experienced hire (non-career changer) with CFA + MBA coming out of H / S / W?

The highest guaranteed compensation coming out of b-schools are in the $500-600K range, but that is VERY rare, usually no more than a handful out of all U.S. b-schools. My guess is these are people who were superstars at elite private equity firms and hedge funds before HSW MBA, and their companies agreed to pay for their degree if they agreed to return. Having said that, post-mba hedge fund pay is a lot more variable than PE, which is more structured. I imagine a harvard jd/mba going to paulson will make more his first-year out than someone at a small long-short equity fund.

Jan 11, 2012

So what would be a reasonable expectation then? The 320K median number seems like it would be low if there are career switchers involved and 2 + 2 type of candidates with little or no experience.

It's hard to believe that a "superstar" at an elite hedge fund would go back for an MBA at all -- why not just stay and make money or open your own shop?

Jan 11, 2012
Ravenous:

So what would be a reasonable expectation then? The 320K median number seems like it would be low if there are career switchers involved and 2 + 2 type of candidates with little or no experience.

It's hard to believe that a "superstar" at an elite hedge fund would go back for an MBA at all -- why not just stay and make money or open your own shop?

I honestly don't know what the "reasonable" expectation would be. For hedge funds, it's quite variable, but $300-350K including bonus don't seem too far fetched if you have relevant experience and coming out of a top b-school.

There are many reasons for superstars to go back to b-school. Some of them are burned out and want the break, others go for the networking opportunities, still others may want the amazing social experience that awaits them. I have noticed that a lot more people at top hedge funds are now going to b-school. I know a girl who left a portfolio manager job at citadel for stanford business and another who left soros for HBS.

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Jan 11, 2012

I would imagine it would have something to do with a personal desire to get an MBA possibly? I'm not sure though ravenous

Jan 11, 2012

Oh right, I forgot about the amazing social experience that awaits them. Is it like two chicks at the same time every night? I heard that chicks dig ex-Soros analysts.

I honestly thought it would have been higher on the exit given the economics of the industry. If you are working at a mega fund and recommending positions that account for tens of millions of dollars of capital, $350 would seem quite low to me. Obviously it's widely variable though.

Jan 11, 2012
Ravenous:

Oh right, I forgot about the amazing social experience that awaits them. Is it like two chicks at the same time every night? I heard that chicks dig ex-Soros analysts.

I honestly thought it would have been higher on the exit given the economics of the industry. If you are working at a mega fund and recommending positions that account for tens of millions of dollars of capital, $350 would seem quite low to me. Obviously it's widely variable though.

When you're at a top pe firm or hedge fund you're working long stressful hours. You obviously know this already. Going from that to b-school, where you're cruising for 2 years, mostly networking, partying, and travelling, is a very welcome development for these people. Of course, ultimately, it's a personal call on whether that's worth it.

Unless you're a partner or PM, you're not gonna make the real big bucks at a hedge fund. A research analyst at paulson probably makes no more than $500K, which is awesome money, but nowhere close to what a PM will be bringing. At the end of the day, you will be the one doing the research and making recommendations while it's the PM who's taking on the actual risk and making the final calls. So it's natural that they get the lion's share of pnl.

Jan 11, 2012

Trust me, I know what the long hours are like. I work 6 or 7 days a week. I have a hard time explaining to people outside the industry how stressful it is.

The PM argument is sort of bullshit -- I know everyone tries to make that argument, but if you source an idea and it doubles or triples, the PM takes credit for that. If shit hits the fan, suddenly it's entirely your responsibility. At least that is what I have seen and heard from others. Not that being an analyst isn't a great job, but it's definitely not where you want to be long-term.

Anyway, as much as b-school might be fun, is it worth the $500 - 800K in opportunity cost and tuition expense? It's a rhetorical question.

Jan 11, 2012
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