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Morning Coffee: Hedge Fund Pay Ticks Upwards

Toiling away at a hedge fund is still good work, if you can keep it. While a number of smaller firms have shuttered in recent months, hedge fund compensation will likely increase 15% in 2012 compared to a year ago, according to a new study from executive search firm Glocap.

The biggest winners are marketing, compliance and risk management professionals, who have seen their pay spike this year due to an increased demand for their services, Adam Zoia, chief executive at Glocap, told Financial News.

Still, compensation at hedge funds has not neared pre-recession levels, when hedge fund performance, and thus pay, was higher. In addition, this year’s pay isn’t being evenly distributed among firms. Investment managers at larger, better-performing funds are seeing the lion’s share of compensation as assets have become more concentrated with the major players. Investment managers at smaller, lesser-performing firms have seen their pay decrease by 5%, says Glocap.

The compensation trend at hedge funds mirrors that at investment banks, where middling performers are seeing pay cuts, or being laid off entirely, while top performers are getting big increases. Even within finance, it’s the 1% who are winning.

Drawing the Curtain (WSJ)

A whistleblower group is set to receive $1.1 million after Bank of New York Mellon reached an agreement with the state of Virginia over charges that it concealed markups on currency transactions.

The Sandy Effect (Reuters)

Insurers, which have been staffing up in 2012, may not escaped Sandy’s wrath after all. Claimed losses from the hurricane have led Chubb to put the brakes on its share repurchase plan.

Another Casualty (CNN)

Bernie Madoff’s former controller, Irwin Lipkin, 74, pleaded guilty to charges of conspiracy to commit securities fraud and other crimes but denied having any direct knowledge of the decades-long Ponzi scheme.

Busted (Bloomberg)

U.S. regulators have accused a former Goldman Sachs commodities trader of fabricating trades to conceal an $8.3 billion futures position, a move that cost the firm nearly $120 million.

No More Temps (Bloomberg)

The average number of jobs created each month during the third quarter was nearly triple that of the second quarter. Unlike earlier in the year, the vast majority were full-time hires.

Wacky Hours (Business Insider)

The three-hour time difference between the East Coast and the West Coast makes for a very different day in the life of a trader.

Brilliant But Odd (The Guardian)

Reaching partner status at Goldman Sachs involves a “reasonably odd” process where seemingly everyone in the firm is interviewed except the candidate in question.

Adieu (Financial News)

Goldman Sachs partner Neil Wright, head of securities division distribution for the Middle East and North Africa, will retire at the end of the year.

Buzz Around the Office

Not Quite 20% (Business Insider)

Wonder why the average Joe hates financiers? Stories like this one, involving a U.K. commodities trader who dropped $63,000 during a night out with friends.

List of the Day: Office Politics

Like politics, sides are often drawn in corporate offices over a project or specific issue. In an effort to avoid gridlock, heed this advice.

  1. Utilize at least one component from the opponent’s platform.
  2. Don’t let your pride get in the way of an appropriate solution.
  3. Never declare victory.

(Source: AOL Jobs)

Write to Beecher Tuttle at

AUTHORBeecher Tuttle US Editor

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