Fishing in Wall Street's troubled waters, the biggest names in the alternative investments business are feasting on top performers recruited out of investment banks.
"More than 45 traders, bankers, analysts and other executives have left the major investment banks this year to join hedge funds and private-equity firms," Bloomberg News reported. Bloomberg said it toted up the figure - which excludes people who left Wall Street to start their own companies - from various company releases. Those doing the recruiting include Citadel, Tudor and "at least 20" other hedge funds, the newswire said. PE firm Apollo Management is mentioned as well.
While the movement is hardly new, headhunters say the pace has picked up now that the investment bank world is enduring a downswing in both bonus expectations and job security. "Investment banks were always considered to be more secure than hedge funds, but now that security isn't there anymore,'' Keith Mann, managing director at New York search firm Dynamics Associates, told Bloomberg. Wall Street compensation consultant Alan Johnson said analysts can double their total to as much as $4 million by moving across the aisle from Wall Street to a hedge fund.
The story observes that the broad one-way flow could cause a "talent gap" for Wall Street a few years down the line.