Hedge fund compensation
Can someone help explain the compensation structure for a hedge fund analyst, as well as share what the average numbers look like? Appreciate any help. Thanks.
Standard as Ib, just bigger cash bonuses, unlike PE where you can also get paid in carry.
Analysts ain’t getting carry. Post MBA is standard practice. Senior Associate +
I’ve actually read that most analysts at hedge funds usually make less than IB/PE because of the variability of bonuses, is that true? Source is a blog called buysidehustle and some friends I have. Talking about bigger multi manager funds where your bonus is dependent on team. Kinda reminds me of sales in a way, the potential upside is big, but you got to be good.
Vast majority of HF analysts are between $250k to $750k. Base is between $100-200k, rest is bonus. The ones who get more than that either a) have very generous PMs at the multi-manager funds, b) have a "sleeve" (i.e. a small carved out portfolio that they manage) or they get a cut of P&L for their ideas or c) are partners (or directors of research/ head of a sector) at single managers. That's where you can see the $1m+ total comp figures. PMs at multi-managers get a cut of their PnL (usually 10-20%) + a base of $125-250k. Hedge fund managers (i.e. founders of single manager funds) are more like entrepreneurs so they keep a much larger chunk of the fees their fund generates.
Above is generally correct
Yeah have heard of the person getting a share of the P&L
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