2016 financial compensation surveyfiles.constantcontact.com/0d599bd1101/ae9c2055-389...survey,...
TRANSCRIPT
2016 FINANCIAL COMPENSATION SURVEY
FINDINGS AND RESULTS
November 2016
1
Dear Colleagues,
As premier professional organizations for investment professionals, CFA Society Iowa and CFA Society Nebraska are dedicated to being reliable and trustworthy sources of information. Each Society strives to serve members by providing them the resources to aid in their career development and advancement.
We are excited to announce the highly anticipated findings of the 2016 Financial Compensation Survey. This is the second year our Societies have participated in the survey, which provides a region-specific analysis of compensation levels for investment and financial professionals. This whitepaper captures the findings of the survey, providing an overview of the survey-wide results.
For those who participated in the survey, we thank you for your contribution to this important market resource. We are confident the information contained in this document will be of value to you.
Regards,
Brett Peterson, CFAPresident, CFA Society Iowa
Joe Lionberger, CFAPresident, CFA Society Nebraska
2016 FINANCIAL COMPENSATION REPORT
LETTER FROM SOCIETY LEADERSHIP
2
Executive Summary
Access to accurate and data-driven information plays a significant role in the ability of financial and investment professionals to effectively perform in their careers. The same is true to successfully advance one’s career.
The 2016 CFA Societies Financial Compensation Survey seeks to provide access to this vital information. This report is a compilation of the results from a survey on compensation practices in Iowa and Nebraska conducted earlier this year; 228 professionals completed the survey.
Remaining true to the stated commitment to provide an accurate snapshot of the compensation levels for the entire financial and investment industry, the survey findings are presented to demonstrate compensation based on the most popular positions and other demographics.
The survey requested self-reported data on numerous aspects of compensation. In addition to covering base salary and total compensation, the survey addressed the respondent’s CFA Charterholder status, level of education, and occupation. Information on the type and size of the firm as well as the amount of assets under management were included in the survey. The survey captured annual salary change data and the respondent’s view on the adequacy of compensation and the desire to explore other job opportunities.
The 2016 Financial Compensation Survey data and exhibits are intended to provide general guidance for comparing compensation levels with overall values for key categories. Note that actual compensation potential may vary relative to the numbers generated by the survey given the use of relatively broad category definitions. Also, the estimation of compensation based on any single factor may not predict reasonably accurate estimates. Details surrounding actual job responsibilities and the confluence of multiple factors may result in higher or lower compensation levels.
.
2016 FINANCIAL COMPENSATION REPORT
EXECUTIVE SUMMARY
Median total compensation
Non-Charterholder CFA Charterholder
Our data show that professionals who attain the CFA designation and/or a graduate degree tend to have higher compensation levels
$71,050$125,250
$90,250$164,890
Bachelor degree
Graduate degree
3
2016 FINANCIAL COMPENSATION REPORT
RESPONDENT PROFILES
Years of experience< 2 years
2 – 5 years
5 –10 years
10 – 20 years
8.0%17.0%25.0%32.0%
20 + years 18.0%
EducationSome college but no degree
Associate degree
Bachelor degree
0.0%0.0%
47.4%Graduate degree
Doctorate50.9%
1.8%
98.0%of those surveyed report that
CFA® Charter designation has helped career
Charterholder status
67.0%Yes
12.0% No
21.0% Candidate
Feel valued by their company
83.0%Yes 1.3%
N/A
15.7% No
Feel fairly compensated
71.7%Yes
28.3% No
4
2016 FINANCIAL COMPENSATION REPORT
RESPONDENT PROFILES
Opportunity for advancement within company
64.6%Yes
0.4% N/A
21.5% No
13.5% Not sure
Likelihood of looking for a new role in 2016
43.5%Unlikely
19.7% Likely
27.4% Very unlikely
9.4% Very likely
Employer size< 50
50 to < 250
250 to < 500
500 to < 2,500
18.0%11.0%7.0%
24.0%2,500 to < 5,000 5.0%
≥ 5,000 34.0%
AUM of firm< $500 million
$500 million to < $2 billion
$2 billion to < $10 billion
$10 billion to < $50 billion
7.0%15.0%15.0%8.0%
$50 billion to < $100 billion 11.0%≥ $100 billion 32.0%
Not applicable 11.0%
5
2016 FINANCIAL COMPENSATION REPORT
RESPONDENT PROFILES
Fifteen most common occupations17.1%8.3%7.9%6.6%6.6%3.9%3.9%3.9%3.5%3.5%3.1%2.6%2.2%2.2%2.2%
Buy-side Research Analyst (fixed income)
Portfolio Manager (fixed income)
Financial Analyst (corporate)
Bank/Trust/Private Client Portfolio Manager
Chief Investment Officer
Accountant/Auditor
Manager of Managers
Portfolio Manager (equities)
Buy-side Research Analyst (equity)
Performance Analyst
Operations/Reconciliation
Actuary
Buy-side Trader (fixed income)
Consultant
Financial Advisor/Broker
Organization type32.0%31.0%16.0%8.0%4.0%3.0%3.0%2.0%1.0%
Investment Management Firm
Insurance Company
Investment Bank, Commercial Bank, Brokerage Firm
Other
Government Agency/Department
Consulting, Accounting, Law Firm
Endowment, Foundation, Other Not-for-Profit
Educational Institution
Family Office
6
2016 FINANCIAL COMPENSATION REPORT
FINANCIAL COMPENSATION
Types of compensation in addition to base salary
86.0%85.0%15.0%13.0%
7.0%4.0%
Cash/Bonus Performance
Employer 401(k) Contributions
Profit Sharing
Restricted Stock Awards/Phantom Shares
Deferred/Multi-year Earnings
Commission/Sales Bonus
Stock Options 1.0%
Average ideal compensation structure for selected occupations
70.4% / 25.3% / 4.0% / 0.4%
65.6% / 27.2% / 7.2% / 0.0%
81.1% / 11.4% / 6.4% / 1.1%
63.6% / 17.5% / 13.6% / 5.4%
77.1% / 15.4% / 6.4% / 1.1%66.7% / 23.3% / 7.8% / 2.2%
76.1% / 14.9% / 7.9% / 1.1%
84.2% / 12.2% / 2.8% / 0.8%
62.5% / 30.6% / 6.9% / 0.0%
92.0% / 7.3% / 0.7% / 0.0%
Occupation
Buy-side Research Analyst (fixed income)
Portfolio Manager (fixed income)
Financial Analyst (corporate)
Chief Investment Officer
Bank/Trust/Private Client Portfolio Manager
Portfolio Manager (equities)
Manager of Managers
Accountant/Auditor
Buy-side Research Analyst (equity)
Operations/Reconciliation
Expected change in total compensation
Decline 4.0% Stay the same 12.0% Increase 10–20% 14.0% Increase > 20% 5.0%
64%Increase 0–10%
Base Cash bonus Long term Other
Overall firm performance and business unit/division performance were the top two determinants of bonus
7
2016 FINANCIAL COMPENSATION REPORT
FINANCIAL COMPENSATION
Median and 75th percentile total compensation by occupation
Base N Bonus N Other Comp N Total
Comp N
Buy-side Research Analyst (fixed income) 90,000 39 28,000 36 5,000 39 122,800 39
75th Percentile 121,450 76,125 9,365 191,700
Portfolio Manager (fixed income) 123,000 23 23,500 16 5,397 19 128,000 19
75th Percentile 168,500 138,750 14,350 298,875
Financial Analyst (corporate) 68,500 18 9,350 16 3,050 18 73,857 18
75th Percentile 97,500 13,500 4,375 123,000
Bank/Trust/Private Client Portfolio Manager 104,000 15 13,400 12 5,900 15 115,200 15
75th Percentile 140,500 28,725 13,500 185,825
Chief Investment Officer 171,370 15 125,000 8 2,000 15 236,000 15
75th Percentile 245,000 191,500 17,875 358,814
Note: Only Reported for positions with 10 or more responses.
8
2016 FINANCIAL COMPENSATION REPORT
FINANCIAL COMPENSATION
Reported median compensation for those with less than 5 years of experience for selected occupations
Base N Bonus N Other Comp N Total
Comp N
Buy-side Research Analyst (fixed income) 66,450 14 13,000 12 3,800 14 81,700 14
Financial Analyst (corporate) 59,000 8 3,856 7 1,945 8 64,678 8
Reported median compensation for those with 5 to less than 10 years of experience for selected occupations
Base N Bonus N Other Comp N Total
Comp N
Buy-side Research analyst (fixed income) 90,000 9 26,000 9 8,000 9 122,800 9
Portfolio Manager (fixed income) 80,320 5 10,000 5 3,600 5 99,490 5
Median total compensation for those with less than 5 years of experience is $72,000
Median total compensation for those with 5 to less than 10 years of experience is $114,778
9
2016 FINANCIAL COMPENSATION REPORT
FINANCIAL COMPENSATION
Note: Cells in gray reflect fewer than five responses.
Reported median compensation for those with 10 to less than 20 years of experience for selected occupations
Base N Bonus N Other Comp N Total
Comp N
Buy-side Research Analyst (fixed income) 112,950 10 56,000 9 5,814 10 177,965 10
Financial Analyst (corporate) 100,000 7 11,000 7 8,000 7 128,800 7
Portfolio Manager (fixed income) 143,000 7 95,000 5 5,600 7 164,000 7
Bank/Trust/Private Client Portfolio Manager 136,000 5 4 10,500 5 158,500 5
Chief Investment Officer 171,370 5 2 5,500 5 194,400 5
Manager of Managers 148,800 5 4 10,000 5 188,800 5
Reported median compensation for those with more than 20 years of experience for selected occupations
Base N Bonus N Other Comp N Total
Comp N
Buy-side Research Analyst (fixed income) 156,625 6 100,000 6 3,000 6 272,500 6
Chief Investment Officer 275,000 6 150,000 5 6,000 6 358,814 6
Portfolio Manager (fixed income) 200,000 5 4 10,000 5 505,000 5
Median total compensation for those with 10 to less than 20 years of experience is $162,000
Median total compensation for those with more than 20 years of experience is $240,500
10
2016 FINANCIAL COMPENSATION REPORT
FINANCIAL COMPENSATION
2014 vs 2015 compensation trend analysis
Compensation satisfaction vs. likelihood of looking for new job
Individuals who do not feel they are fairly compensated report they are more likely to look for a new job than their counterparts who believe they are fairly compensated.
Fairly compensated Not fairly compensated
7.5% 14.1%
13.8%
34.4%
44.7%
40.6%
34.0%
10.9%
Very Likely Likely Unlikely Very Unlikely
$68,600
$72,000 $104,000
$114,778
$157,600
$162,000
$275,000
$240,500
< 5 Years 5 to < 10 Years 10 to < 20 Years 20 + Years
2014 2015
11
2016 FINANCIAL COMPENSATION REPORT
SURVEY METHODOLOGY
Survey methodology
MethodAn online survey was deployed to known financial professionals in the region represented by CFA Society Iowa and CFA Society Nebraska. Email subscribers of CFA Society Iowa and CFA Society Nebraska and LinkedIn group members were specifically targeted. The survey was not limited to just these audiences. In addition, this survey was structured so all data gathered was anonymous, with no identifiable information requested.
RespondentsRespondents were financial and investment professionals, and totaled 228 unique and completed responses.
TimingThe survey was active from April 18 – May 13, 2016.
AssumptionsThe findings from this survey were derived from self-reported data. Because the survey uses sampling methodology and broadly defined positions, survey findings are not necessarily representative of the total population; rather, the survey is designed to provide general information about pay levels within the industry. Earning any degree or professional designation is no guarantee of employment or compensation.
12
2016 FINANCIAL COMPENSATION REPORT
ABOUT THE CFA SOCIETIES
About CFA Society Iowa and CFA Society Nebraska
The CFA Societies of Iowa and Nebraska are the premier professional organizations for investment professionals to connect with Chartered Financial Analysts throughout the region. Each Society strives to serve its broad membership through relevant educational programs, membership support services and opportunities for advancement such as networking events, discounts on educational materials, and more.
Both CFA Society Iowa and CFA Society Nebraska:
• Promote ethical and professional standards within the investment industry,
• Encourage professional development through the CFA Program and continuing education,
• Facilitate the exchange of information and opinions among people within the local investment community and beyond, and;
• Work to further the public's understanding of the CFA designation and investment industry.
If you are interested in learning more about earning your charter, or to learn more about CFA Society Iowa and CFA Society Nebraska, contact [email protected] (Iowa) or [email protected] (Nebraska).
Follow CFA Society Iowa at:
Follow CFA Society Nebraska at: