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Kamil90
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Joined: February 15th, 2012, 2:02 pm

titles across firms

March 15th, 2022, 5:26 pm

I am curious how income varies when the person has a title for example "MD" at Goldman or the same title "MD" at a small hedge fund. I have witnessed people who I think got to MD a lot faster and easier at smaller hedge funds and yet someone is still working very hard to get the same title at Goldman. Does it mean that the first one is most likely financially better off? Can titles be compared at all? I was told smaller hedge funds pay better at junior roles but does it persist across the ladder? What's the point of fighting to become an MD at Goldman then?

Thanks, "your confused" Junior quant.
 
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bearish
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Re: titles across firms

March 17th, 2022, 1:28 am

This is tricky. As a rough rule of thumb, people in similar functions with similar titles in similar organizations (especially large ones) can reasonably be expected to be in broadly similar compensation bands. But, these bands are wide, and the more senior, the wider. When you start comparing across different types of firms and/or functional areas, pretty much all bets are off. At the MD level, you can easily have an order of magnitude difference between a successful trader at Goldman and a competent back office manager at an insurance company affiliated asset manager.
 
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Kamil90
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Re: titles across firms

March 17th, 2022, 1:37 pm

Thanks, if I put salary apart then, I am curious if there is still a reason to work for Goldman vs going to a smaller firm. I have observed someone left a big bank and went to work for a smaller firm at mid career. I would think at that point the person was offered more money but is there still a reason to stick around at the firms like Goldman for longer? Does it give you a boost later on when you want to jump to a smaller firm at a more senior level?
 
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bearish
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Re: titles across firms

March 17th, 2022, 7:13 pm

https://youtu.be/Lx4poQw1mZo

With some luck, that link works. Anyway, it’s at least a couple of decades ago that Goldman defined the peak place to be in finance. That being said, being successful there can still make you very well off. Just not quite as well off as if you were successful in any number of PE firms or hedge funds (or some outfit producing bad monkey drawing NFTs). But realistically, the chance of any of those are close to vanishingly small for a given individual (no knock on you). What has remained a constant at Goldman is the social contract where you forfeit most of your personal life and get assimilated by the Borg.
 
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Kamil90
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Re: titles across firms

March 19th, 2022, 1:55 am

Thanks, that makes sense. What I also wonder, there are lots of flavors of quants in the banks, some of them in Model Val, some of them strats, some of the Market Risk, etc, etc. Do they at least have the same base given the same title? I understand the bonus can be variable but how about the base?
 
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bearish
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Re: titles across firms

March 19th, 2022, 4:11 pm

I think it’s fair to say that the big gaps come from the “variable” part of the compensation plan, but it’s my understanding that there has been meaningful upward pressure on salaries for front office personnel in banks caught out by EU (and UK?) anti-bonus measures. I’m guessing that might apply to some strat type quants, but I’ve been away from the sell side long enough not to have any relevant first hand information. But, back in the day (when men were men and there were a lot fewer quants doing model risk management) your salary was nearly irrelevant, in that the year-end discussions would revolve around total comp, and your bonus would be calculated as your total comp minus what happened to be your salary. That is of course highly stylized, but more right than wrong, and more so as you were looking at more senior people.