Research has found that fund managers need to run their portfolios for around 4 years before their salaries top £100,000. The study by Morgan McKinley has shown that the average fund managers' basic salary in London is between £30,000 and £45,000 for managers with less than 2 years experience, rising to £42,000 and £75,000 for between 2 and 4 years experience. For managers with more than 8 years experience, salaries are generally paid on a performance basis.
The research also found that on average, senior financial service salaries have risen by 15% over the last year, as firms are taking on more staff.
In February , the rate at which city firms were hiring new employees rose by 45% compared to the same time in 2005.
Our view
The problem with this approach is that fund managers are rewarded for ever improving performance. However, they still get paid for when they underperform!