London hedge funds don't pay much if you're in an admin role
It's hedge fund reporting season in the UK, which means that for the next few weeks various funds will reveal both their pnl and spending on employees. Figures are lagged and are typically provided for a 12 month period that ended sometime early in 2019.
The latest funds to release results are Lansdowne Partners Limited, the large European equities fund with around $15bn, and Odey Asset Management Group Limited, which provides administrative services to the portfolio managers over at the partnership Odey Asset Management LLP. Odey's results are a reminder that not all hedge fund jobs are a lucrative career.
Odey Asset Management LLP has yet to report, so we don't know how much Crispin Odey himself earned. Nor do we know much Odey paid its average portfolio manager. However, in the year ending April 2019, Odey Asset Management Group Limited employed a total of 60 people (19 investment managers, five directors and 36 administrators) and spent just £2.2m on wages and salaries, which works out as an average of £37k ($49k) per head. The figures don't include bonuses, which are likely to be considerable for the investment managers, but less impressive for everyone else. The implication is that if you're an administrative professional at Odey, you can expect to earn well below £100k.
Over at Lansdowne, meanwhile, average compensation per head fell from £287k in the year ending March 2018 to £233k a year later. The reduction came as profits fell from £119m to £91m and revenues declined from £173m to £158m. A further £17m was, however, allocated to 'members' and is likely to have been shared between Lansdowne's 35 investment management staff.
Now that hedge funds are an established part of the pensions investing pantheon, support staff are increasingly important. At Odey, there are nearly two administrators to every investment professional. At Lansdowne, there were 69 operations and support professionals last year, compared to 35 investment professionals. Operations headcount rose (by four people); investment headcount did not.
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