Let say an offer from citadel is like 250k ish base + 450k bonus + 150k sign on. What is the implication of deferred bonus at citadel?
Godamn what kind of offer is that
I don’t know about Citadel, but lots of FAANG style companies have differed sign on bonuses. Differed always means later. Usually 1-2 years later but your mileage may vary. The way that Amazon did this (I think they still do) was something like: Salary - 250k Year 1 sign bonus - 150k Anticipated RSU Gain - 50k Year 2 Sign Bonus - 100k Anticipated RSU Gain year 2 - 135k The purpose of the differed sign was to smooth out outsized RSU gains in later years. If don’t do this you can’t hire away anyone late on vesting or with refreshers because even if your deal is better, it won’t be for at least a few years.
You will get about 1/3 in cash i.e. 150k of the bonus per year, the rest is put in employee funds. This repeats every year (1/3 vesting and 2/3 of next year bonus deferred) and if you stay 1+ years you will have ~1 year bonus in the fund. When you quit, there are non compete related conditions in vesting the remaining It's pretty standard in finance, talk to your recruiter. Read through terms closely as they change all the time
Some portion of your bonus goes into the fund and stays for 40 months. You get the deferred portion only after 40 months no matter you stay or left the company.
Anything on your contract is cash. No deferral. Your first perf based bonus will vest in thirds.
Is the fund performing like the general citadel funds? 20% return per year? Because in that case it’s not that bad.
Yeah the same fund and you can put in more optionally.
How is it like at IMC?
There are different deferred plans in the company. You have to ask your recruiter which one you have and update us here. In some plans you lose the deferred portion if you leave before it vests, in some you don’t. Btw, are those hypothetical numbers or an actual offer you received?
You get paid at a later date, hence deferred
later date when? how is it different from RSU?
The deferred amount is invested into their main find so it can also change. When I was there it was leveraged 1.5x and you paid labor + 150bps on leverage. Then 2008 happened, the fund was down 60% and people lost 95% of their bonus. I think they've stopped leveraging the money now (the fund itself obviously uses leverage but that's different).