CHARLOTTESVILLE, Va. Roughly three-quarters of investment professionals around the globe who are members of the CFA Institute saw their total compensation increase in 2006, with some of the strongest gains in China, South Africa and the U.K., according to a survey by the CFA Institute.
The survey, based on 13,562 responses from a potential pool of 75,406 CFA members, showed 73% of respondents reporting an increase in compensation, 19% reporting no major change and 6% reporting a decrease.
Peggy Eisen, the institutes managing director of marketing and communications, said substantial revisions to the latest survey questions make it difficult to compare the results with earlier surveys. Ms. Eisen said the current survey should provide a strong benchmark for future comparisons.
For the latest survey, U.S. and U.K. respondents reported the highest compensation levels, even if respondents in other countries reported stronger gains. U.S.-based respondents accounted for 66% of the survey total. Of those 8,970 U.S. respondents, 30% reported gains in total compensation of 20% or more, followed by 24% with a gain of between 10% to 20%, and 18% with a 5% to 10% gain.
Median total compensation for the year came to $456,000 for equity portfolio managers in the U.S., $250,000 for fixed-income portfolio managers and $158,000 for managers of index strategies. Compensation came to $200,000 for buy-side equity analysts; $214,000 for buy-side fixed-income analysts and $195,000 for sell-side equity analysts.
The 7% of U.S.-based respondents reporting a decline in total compensation for the year was the highest of any country.
Of the 925 U.K.-based respondents in the survey, 47% reported an increase in their total compensation of 20% or more, followed by 22% with a gain of 10% to 20% and 13% with between 5% and 10%. Median total compensation in 2006 came to $313,000 for U.K. equity portfolio managers, $272,000 for fixed-income portfolio managers and $173,000 for managers of index strategies. Median total compensation was $215,000 for buy-side equity research analysts, $201,000 for buy-side fixed-income analysts and $294,000 for sell-side equity analysts.
Respondents in China reported some of the strongest gains. Roughly 50% of the relatively small sample of 123 respondents reported a gain of 20% or more in total compensation for the year, followed by 22% reporting a gain of between 10% and 20%, and 13% with a gain of 5% to 10%.
Median total compensation for a portfolio manager in China, however, came to only $50,000, a fraction of the $175,000 figure in Hong Kong and less than 20% of what equity or fixed-income portfolio managers earned in either the U.S. or the U.K.
In South Africa, 48% of respondents reported gains of 20% or more. Only 27% of respondents in Canada and 18% in Japan reported similarly strong gains.
Within total compensation, the survey found long-term incentives to be more prevalent among respondents in South Africa, the U.K. and the U.S., and less prevalent among respondents from China and Germany.
Ms. Eisen said the CFA Institute estimates that between 25% and 30% of investment professionals in the U.S. are CFA members, compared with more than 50% in markets such as Singapore and Hong Kong. In the U.K., the institutes market penetration is below 15%, but poised for strong growth, she said.