October FINANCIAL COMPENSATION SURVEY

Transcription

1 October FIACIAL COMPESATIO SURVEY

2 Letter from the President As premier professional organizations for investment professionals in our region, CFA Society Madison and CFA Society Milwaukee are dedicated to being reliable and trustworthy sources of information. We strive to serve our members by providing them the resources to aide in their career development and advancement. ew for our market, we are excited to announce the highly anticipated findings of the 2015 Financial ensation Survey. This survey, which had been void in the market since 2007, provides a regionspecific analysis of compensation levels for investment and financial professionals. This document captures the findings of this survey, providing an overview of the survey-wide results. For those who participated in the survey, I thank you for your contribution to this important market resource. I am confident the information shared in this document will be of value to you. Regards, Christopher Reed, CFA President, CFA Society Madison Christopher K. Merker, CFA President, CFA Society Milwaukee 1

3 Executive Summary Executive Summary Access to accurate and data-driven information plays a significant role in the ability of financial and investment professionals to effectively perform in their careers. The same is true to successfully advance one s career. However, since 2007 this source of data has been missing, spurring the deployment of the 2015 Financial ensation Level Survey by CFA Society Madison and CFA Society Milwaukee. Remaining true to the stated commitment to provide an accurate snapshot of the compensation levels for the entire financial and investment industry, the survey findings are presented to demonstrate compensation based on the most popular positions and other demographics. Given the imperative to accurately, albeit broadly, define compensation levels of financial professionals in the Madison and Milwaukee region, CFA Society Madison and CFA Society Milwaukee conducted a self-reporting survey. This primary research examines the impact of variables (e.g. tenure, title, CFA designation, education, et al) on compensation levels. In addition, compensation components and desired pay structure were captured, as were annual salary change data. The results are meant to provide a general snapshot of the current state of the market. Data shows professionals who invest their time in attaining advanced degrees and CFA certification tend to have higher compensation levels than those who don't. This is based on self-reported data collected by CFA Society Madison and CFA Society Milwaukee. $250,000 $200,000 $150,000 $100,000 $50,000 $72,000 $177,800 $0 Bachelors Degree on-charterholder Median Total ensation $111,000 $225,000 Graduate Degree CFA Charterholder 2

4 Respondent Profiles Years of Experience Charterholder Status <2 years 10% 2 to <5 years 15% 5 to <10 years 22% 10 to <20 years 32% 20 years or more 22% AUM of Firm <$500 million 7% $500 to <$2 billion 13% $2 to <$10 billion 20% $10 to <$50 billion 13% $50 to <$100 billion 7% $100 billion or more 32% ot applicable 9% Charterholder 71% one 6% Candidate 23% Likelihood of Looking for ew Role in 2015 Education Some college but 0% no degree Associate degree 0% Bachelor degree 48% Graduate degree 51% Doctorate 1% Very Likely 12% Likely 21% Unlikely 40% Very Unlikely 27% 3

5 Respondent Profiles Fifteen Most Common Job Titles Organization Type Buy-side Research Analyst (equity) 12% Portfolio Manager (equities) 10% Buy-side Research Analyst (fixed income) 9% Portfolio Manager (fixed income) 6% Financial Advisor/Broker 5% Chief Investment Officer 5% Consultant 5% Risk Manager 5% Accountant/Auditor 4% Bank/Private Client Portfolio Manager 4% Manager Research (equity) 3% Performance Analyst 3% Buy-side Research Analyst (other) 3% Private Client Professional (other) 2% Credit Analyst (rating) 2% Investment management firm 40% Investment bank, commercial bank, 24% brokerage firm Insurance company 13% Other 7% Consulting, accounting, law firm 5% Government agency/department 5% Endowment, foundation, 2% other not-for-profit Educational institution 1% Corporate plan sponsor 1% Family office 1% Employer Size <50 27% 50 to <250 18% 250 to <500 6% 500 to <2,500 13% 2,500 to <5,000 14% 5,000 or more 22% 4

6 Financial ensation Change in Total ensation Increased more than 20% 8% Increased 10<20% 16% Increased 0<10% 55% Stay the same 18% Decline 4% Primary Determinant of Bonus Other Forms of ensation Business unit/division performance 28% Overall firm performance 24% Discretionary 13% Individual investment performance 13% Other factors related to 13% individual performance Individual financial contribution 5% Commissions generated 3% Cash bonus performance 86% Employer 401(k) contributions 79% Profit sharing 32% Restricted stock awards/phantom share 13% Deferred/multi-year earnings 11% Commission/sales bonus 9% Stock options 3% 5

7 Financial ensation Median Total ensation by Occupation Base Bonus Other Total Accountant/Auditor 63, , , , th Percentile 77,625 8,550 5,750 90,375 Bank/Private Client Portfolio Manager 132, , , , th Percentile 169,000 40,000 36, ,800 Buy-side Research Analyst (equity) 135, , , , th Percentile 155, ,250 28, ,500 Buy-side Research Analyst (fixed income) 120, , , , th Percentile 145, ,000 15, ,800 Buy-side Research Analyst (other) 85, , , , th Percentile 95,000 48,250 4, ,500 Chief Investment Officer 165, , , , th Percentile 200, ,000 52, ,000 Consultant 76, , , , th Percentile 136,250 26,500 6, ,000 Credit Analyst (rating) 65, , , , th Percentile 110,000 20,750 3, ,000 Financial Advisor/Broker 80, , , , th Percentile 100,000 92,500 92, ,300 Head of Fixed Income 215, , , , th Percentile 391, ,750 51, ,875 Institutional Representative Manager 167, , , , th Percentile 215, , , ,750 Manager of Managers 120, , , , th Percentile 133, ,250 23, ,500 Manager Research (equity) 77, , , , th Percentile 117,500 38,000 5, ,950 continued» 6

8 Financial ensation Median Total ensation by Occupation Base Bonus Other Total Performance Analyst 50, , , , th Percentile 68,500 12,500 6,000 83,815 Portfolio Manager (equities) 170, , , , th Percentile 200, ,770 38, ,875 Portfolio Manager (fixed income) 150, , , , th Percentile 172, ,000 62, ,800 Private Client Professional (other) 68, , , , th Percentile 101,500 26,000 16, ,200 Risk Manager 101, , , , th Percentile 143,000 71,000 39, ,300 Sell-side Research Analyst (equity) 79, , , , th Percentile 98,625 40,500 6, ,875 7

9 Financial ensation Reported Median ensation for Those With More Than 20 Years of Experience for Selected Occupations Base Bonus Other Total Portfolio Manager (equities) 150, , , , Portfolio Manager (fixed-income) 182, , , ,550 6 Consultant Financial Advisor/Broker Buy-side Research Analyst (equity) Buy-side Research Analyst (fixed-income) Buy-side Research Analyst (other) Performance Analyst Chief Investment Officer 200, , , ,000 7 Bank/Private Client Portfolio Manager 162, , , ,400 8 Accountant/Auditor Risk Manager Chart includes most popular job titles; cells in gray represent five or fewer responses. Median total compensation for those with more than 20 years of experience was $247,900 8

10 Financial ensation Reported Median ensation for Those With 10 to Less Than 20 Years of Experience for Selected Occupations Base Bonus Other Total Portfolio Manager (equities) 177, , , , Portfolio Manager (fixed-income) 157, , , ,000 6 Consultant Financial Advisor/Broker Buy-side Research Analyst (equity) 153, , , , Buy-side Research Analyst (fixed-income) 126, , , , Buy-side Research Analyst (other) Performance Analyst Chief Investment Officer 165, , , ,500 7 Bank/Private Client Portfolio Manager Accountant/Auditor Risk Manager 150, , , ,510 6 Median total compensation for those with 10<20 years of experience was $235,500 9

11 Financial ensation Reported Median ensation for Those With 5 to Less Than 10 Years of Experience for Selected Occupations Base Bonus Other Total Portfolio Manager (equities) Portfolio Manager (fixed-income) 100, , , ,500 7 Consultant Financial Advisor/Broker 63, , , ,468 7 Buy-side Research Analyst (equity) 117, , , , Buy-side Research Analyst (fixed-income) 120, , , ,000 5 Buy-side Research Analyst (other) Performance Analyst Chief Investment Officer Bank/Private Client Portfolio Manager Accountant/Auditor Risk Manager 75, , , ,000 5 Median total compensation for those with 5<10 years of experience was $119,425 10

12 Financial ensation Reported Median ensation for Those With Less Than 5 Years of Experience for Selected Occupations Base Bonus Other Total Portfolio Manager (equities) Portfolio Manager (fixed-income) Consultant 56, , , , Financial Advisor/Broker Buy-side Research Analyst (equity) 60, , , ,000 9 Buy-side Research Analyst (fixed-income) 70, , , ,000 8 Buy-side Research Analyst (other) 75, , , ,075 6 Performance Analyst 47, , , ,250 8 Chief Investment Officer Bank/Private Client Portfolio Manager Accountant/Auditor 60, , , , Risk Manager Median total compensation for those with <5 years of experience was $73,285 11

13 Financial ensation ensation by Employer Size Breakdown by Assets & Employee Size Base Bonus Total Under $500 million Under 50 80, , , to less than to less than to less than 2,500 2,500 to less than 5,000 5,000 or more $500 million to less than $2 billion Under 50 85, , , to less than to less than , , to less than 2,500 2,500 to less than 5,000 5,000 or more $2 billion to less than$10 billion Under , , , to less than , , , to less than to less than 2,500 74, , , ,500 to less than 5, , , , ,000 or more $10 billion to less than $50 billion Under , , , to less than , , , to less than to less than 2, , , , ,500 to less than 5, , , , ,000 or more 175, , ,

14 Financial ensation ensation by Employer Size Breakdown by Assets & Employee Size Base Bonus Total $50 to less than $100 billion Under to less than , , , to less than to less than 2,500 2,500 to less than 5,000 5,000 or more 134, , , Over $100 billion Under to less than , , , to less than , , , to less than 2, , , , ,500 to less than 5, , , , ,000 or more 100, , , ot Applicable Under to less than to less than to less than 2,500 87, , ,500 to less than 5,000 5,000 or more 108, , ,500 9 Additional detailed analysis of this compensation breakdown is available upon request from CFA Society Madison and CFA Society Milwaukee. "ot Applicable" represents the various organizations financial professionals work for that do not manage assets or investments. 13

15 Financial ensation Average Ideal ensation Structure for Selected Occupations Accountant/Auditor 82% 12% 4% 1% Bank/Private Client Portfolio Manager 72% 20% 8% 0% Buy-side Research Analyst (equity) 58% 36% 5% 1% Buy-side Research Analyst (fixed income) 56% 40% 4% 0% Buy-side Research Analyst (other) 71% 25% 3% 1% Chief Investment Officer 62% 22% 9% 7% Consultant 77% 13% 4% 7% Credit Analyst (rating) 80% 19% 1% 1% Financial Advisor/Broker 54% 26% 8% 12% Head of Fixed Income 54% 44% 2% 1% Institutional Representative Manager 43% 44% 12% 1% Manager of Managers 58% 37% 4% 1% Manager Research (equity) 74% 19% 7% 0% Performance Analyst 79% 15% 3% 3% Portfolio Manager (equities) 55% 36% 8% 1% Portfolio Manager (fixed income) 56% 37% 7% 0% Private Client Professional (other) 66% 21% 1% 13% Risk Manager 68% 23% 8% 1% Sell-side Research Analiyst (equity) 67% 32% 1% Base % Cash Bonus % Long-term % Other % 14

16 Survey Methodology Survey Methodology Method An online survey was deployed to known financial professionals in the region represented by CFA Society Madison and CFA Society Milwaukee. subscribers of CFA Society Madison and CFA Society Milwaukee and LinkedIn group members were specifically targeted. The survey was not limited to just these audiences. In addition, this survey was structured so all data gathered was anonymous, with no identifiable information requested. Respondents Respondents are financial and investment professionals, totaling 357 unique and completed responses. Timing The survey was active from April 15, 2015 May 11, Assumptions The findings from this survey were derived from self-reported data. Because the survey uses sampling methodology and broadly defined positions, survey findings are not necessarily representative of the total population; rather, the survey is designed to provide general information about pay levels within the industry. Earning any degree or professional designation is no guarantee of employment or compensation. Generously supported by Hirenomics, LLC Hirenomics is an Executive Recruiting firm specialized in the financial services industry. Our firm represents investment management, private equity, and insurance companies that range from firms with over a trillion in AUM to small boutique firms across the country. What separates our firm from others is our high touch, methodical process to recruiting, along with our unparalleled approach to unearthing passive candidates. As a leader in recruiting, we are proud to say we hold some of the top return-on-investment and long-term retention stats in the industry: a 99% closing ratio and a 94% retention ratio. If you are interested in learning more about Hirenomics, go to 15

17 About CFA Society Madison and CFA Society Milwaukee About CFA Society Madison and CFA Society Milwaukee With more than 200 members, CFA Society Madison is the premier professional organization for the investment management industry in the Madison area. The mission of CFA Society Madison is to provide our members and the local community with educational and networking opportunities, while promoting the highest ethical standards by using our resources, expertise, and affiliation with CFA Institute. We pride ourselves in our strong commitment to engaging with local universities and their students who comprise a significant amount of area candidates pursuing the CFA charter. CFA Society Madison was established as a Chapter of the CFA Society Milwaukee in 1995, transitioned to being a separate Society in 1998 and was incorporated on January 4, CFA Society Milwaukee, established in 1955 and incorporated in 1970, is the local society affiliate of CFA Institute, the premier organization serving investment management professionals globally, headquartered in Charlottesville, Virginia. Since its founding, CFA Society Milwaukee has served the needs of investment professionals by providing high-quality educational programs and a regional forum for its membership. It is dedicated to promoting the highest standards of professional ethics, conduct and competence amongst its membership and the investment community it serves. CFA Society Milwaukee membership consists of approximately 600 professionals who are employed with area banks, insurance companies, investment counselors, brokers, public agencies, universities, and corporations. CFA Society Milwaukee plays a vital role within the investment community. If you are interested in learning more about earning your charter, or to learn more about CFA Society Madison and Milwaukee, contact cfa@cfamadison.org (Madison) or info@cfamilwaukee.org (Milwaukee). Follow CFA Society Madison at: Follow CFA Society Milwaukee at: 16