Investment management professionals are padding their own bottom lines this year, taking home 17% more than they were in 2003, as investment returns improve.
A new survey of investment industry compensation found that the median U.S. pay for investment management professionals in 2005 is $170,000, which includes a $113,000 base, a $35,000 cash bonus and $5,000 in non-cash compensation. The figures were compiled by Russell Reynolds Associates, a recruiting firm in New York, and the CFA Institute, Charlottesville, Va., which represents portfolio managers, research analysts, chief financial officers and other investment professionals worldwide.
Overall, salaries are rising in tandem with assets, revenue and profit performance as the stock market shows more signs of life, the survey of 10,655 CFA members found. About 70% of those surveyed said their firm's profitability had the most significant impact on their bonuses. Portfolio managers' individual investment performance is closely tied to determining their bonuses, with 72% saying it was a factor.
Organizational investment performance affects 30% of chief executive officers and 46% of CIOs.
Overall, 2005 compensation is 7% higher than in 2003 — when the survey was last conducted — but 7% lower than the heady days of 2001.