Because of volatility in the energy markets, commodities traders stand to land bigger bonuses this year, especially if they work on an investment banking desk. Read on for where you can make the most.
London and New York
If you work in commodities trading, London and New York are the places to earn the most. Research by The Options Group suggests Wall Street traders at vice president (VP) level, can expect to take home between 8% and 14% of trading profits as a bonus. Michael Karp, co-founder and partner at international search firm The Options Group, says base pay for someone with five years' trading experience is between $125,000 and $150,000. Bonuses at this level range from $750,000 to more than $1m.
In London, Jakob Bloch, chief executive of recruiter Commodity Appointments, says commodities traders with five years' experience can expect a base salary of more than 100,000. Bonuses vary according to whether traders work for investment banks, specialist commodities traders, or oil companies, with investment banks paying most handsomely. The total can easily exceed 500,000.
Italy and France
Commodities traders in Italy and France are paid more modestly. Guy de Bravoir, a consultant at recruitment firm Robert Walters in Paris, says a trader with five years' experience can expect to earn a base salary of €90,000 working in Paris, plus a bonus of 100% to 150%.
In Italy, Paolo Ghislandi, secretary-general of Aiget, the Milan-based Italian association of energy traders and suppliers, says pay is typically similar, if not lower. "Our members are mostly large companies that offer jobs for life, with an associated degree of job security and good perks," he says. "However, the other side of the coin is that pay is less."
Germany and Switzerland
Commodities trading is one area in which the Swiss market is more advanced than Germany, with the likes of Glencore International, the commodities supplier, based in Zug. Jim Rogers, the US hedge fund manager currently embroiled in the Refco controversy, runs Diapason Commodities Management, a commodities-related index based in Lausanne.
Despite this, Mark Ritter, senior consultant at MCZ Consulting, a Zurich search firm, says commodities trading jobs are rare in Switzerland. When they do arise, Ritter says base pay for someone with five years' experience is likely to be in the region of CHF200,000 (€130,000), plus bonus.
Across the border in Germany, Sasha Gerland, a partner at search firm Hillreiner Consulting, says similarly experienced commodities traders can expect of €90,000, plus a bonus of around 50%. He says most German traders work for corporates rather than banks or trading houses, where pay is typically higher.