The 2010 report shows that on average, 2009 base salaries for all investment professionals and traders were essentially flat (regardless of fund size or performance)with increases in the low single-digits.
Estimates call for 2009 cash bonuses for investment professionals (those paid in early 2010) to increase about 15% on average above suppressed 2008 levels. The highest percentage increases will go to professionals at those funds that decreased compensation the most in 2008. These bonus levels are still, on average, below 2007 levels.
The report consists of analysis of 2009 compensation paid by U.S. hedge funds including estimates for year-end cash bonuses expected to be paid for 2009.
Adam Zoia, CEO at Glocap, pointed out that in 2008, owners of hedge funds heavily subsidized employee compensation in order to keep their teams together and to help boost morale given that funds needed everyone motivated this year to dig out of the high water mark hole created from last year’s abysmal returns. This year there was some initial thought of taking back some of that subsidy from last year and paying lower bonuses than would otherwise be the norm given performance levels.
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