If the equity market holds steady and things don’t change, traders can expected a modest bump in compensation this year.
That’s according to the Options Group’s 2015 Mid-Year Review Financial Markets Overview and Compensation Report. The firm is a global executive search and strategic consulting firm that tracks executive compensation.
See Also:Growth in Low-Touch U.S. Equity Trading Stalls at 33%, Unchanged Since 2012
The firm wrote in its report that based on market conditions and hiring trends for the first six months of 2015, average total compensation changes for the full year will rise modestly for most professionals except for those in commodities, credit, and securitized products.
Options Group forecasted that average change in total compensation for those in U.S., EMEA, and Asia FICC are forecasted to be unchanged to slightly negative. Average change total compensation for equities divisions is forecasted to increase mid-single digits in the U.S, EMEA, and Japan, and mid-teens in Asia.
Compensation trends are the most favorable for rates, investment banking, and equity derivatives in the US and EMEA. In Asia, compensation trends are the most favorable for those in foreign exchange, cash equities, equity derivatives, quantitative and electronic trading, and wealth management. In Japan, compensation trends are the most favorable for electronic trading and risk management.
Other highlights of the report:
. Hiring activity has been heavily weighted towards very specific senior replacement hires and junior level professionals.
. Consolidation of senior management roles and delayed retirements are causing a bottleneck in promotions.
. The pay gap between bulge bracket banks and non-bulge bracket banks continue to decrease.
. Many professionals switching from the sellside to the buyside have not been receiving an increase in compensation.
. Flat rates, rising costs, and reduced profitability continue to constrain firms’ ability to allocate hiring budgets.
. More firms are moving towards a multi-asset class model for sales and trading.
The complete 80-page report is available from Options Group.
