How much am I worth? Strategist, fixed income, leading international bank

A panel of headhunters give their assessment of typical London pay packages: salary - starting at 60,000, going up to 140,000; bonus 50%-400%

Ten years ago investment banks accorded almost mythical status to economists, relying on them to guide analysts and clients through the treacherous waters of international investing.

Today, though it would be an exaggeration to suggest economists have had their moment in the sun, the real focus is on the strategist. So what exactly does a strategist do, aside from, well, helping determine strategy? Obviously their precise role will differ from institution to institution and according to their area of specialisation.

Richard Fraser of RJF Global Search said: 'They consider the extent to which the market outlook is good or bad for eg corporate bonds and make recommendations accordingly, either through written reports or by personal presentation. In essence, they take a global perspective with a strong quantitative approach.'

Jason Garner, a director at Morgan McKinley, views strategists as more akin to economists.

'A senior strategist will assess the markets and regions that the bank operates in on a macro level, report back to the board any strengths, weaknesses, opportunities and threats and produce (macro) recommendations,' he said.

Fraser said a typical strategist will have a more quantitative background than the typical economist: as well as a good understanding of economics and financial markets, he or she will often have an econometric background, with knowledge of stochastic calculus, probabilities and statistical analysis packages quite common. An MBA would also not go amiss.

As well as a macro focus, strategists tend to have a company one, which is why good research skills and some programming skills are expected. Many move into banking from a consultancy background, though academic backgrounds are not unheard of.

So with many financial markets having recovered somewhat from 2002 - though the international political outlook still very much in flux, thanks to the Middle East and Iraq - how is the market for strategists?

Garner said a pick-up in demand for strategists started last year at management consultancies and that this is now feeding into investment banks.

'There are already signs that this is happening with a number of investment banks moving people internally as well as hiring external strategists,' he said.

Remuneration is looking good too. A junior strategist can expect to bring in a starting salary of around 65,000 and pay rises quickly: according to Shaun Springer of Napier Scott, last year senior strategists at director level averaged total compensation of 275,000, while a managing director averaged nearly 400,000.

He said: 'The outlook for 2004 is for roughly similar levels of remuneration, although there is expected to be a continuing increase year-on-year.' He added that in the new era of CP205 (a Financial Services Authority proposal dealing with conflicts of interest), prospects for strategists are viewed as more positive than those for sell side research analysts, because strategists can be deployed internally.

'This means they make...a demonstrable direct contribution to the bottom line, whereas the research analyst is likely become a pure cost centre with no demonstrable contribution to profit,' he said.

In other words, in the brave new world of tougher financial regulation and greater accountability, being a strategist is no bad thing.

Figures and commentary by Morgan McKinley, RJF Global Search and Napier Scott