Hedge fund quadruples pay after comparatively small rise in profits
Hedge funds, particularly those owned by partners and employees, tend to pay well when times are good – portioning out profits to those with a stake in the company. However, one fund based out of the UK and Paris has been decidedly freer with the cash than you might expect after a relatively positive year.
The UK arm of hedge fund Boussard & Gavaudan Partners allocated €12.5m to its 40 employees last year, according to accounts filed this week on Companies House. In 2012, it paid just €3.3m to 41 staff.
2013 was undoubtedly a better year – revenues were €33.3m compared to €19.4m in 2012, and pre-tax profits were €14.5m versus €9.2m.
However, the increase in revenues obviously does not reflect a near fourfold rise in salaries and wages for its employees. On an average per head basis, this works out as €312.5k in 2013, compared to just €80k in 2012. Similarly, its highest paid director received €426.5k last year compared to €91.8k for the previous 12 months.
By hedge fund standards, the 2012 figures are peanuts, despite the fact that salaries would not have been paid equally, so perhaps the radical uplift in pay is an attempt to stem off potential staff defections. It seems to have worked - no one has left the firm in London this year, according to the Financial Conduct Authority register.
Boussard & Gavaudan now employs 17 people in fund management positions, compared to 19 in 2012 and has 23 people working in fund administration functions.
The hedge fund has €1.2bn in assets under management spread across multiple funds. It was founded in 2002 by Emmanuel Boussand, a former Goldman Sachs equity derivatives prop trader who now acts as chief investment officer, and CEO Emmanuel Gavauden who was previously a managing director in Goldman’s investment management division.
It has 12 traders across London and Paris and eight fundamental analysts. The trading team is led by Etienne Becker, who was also part of Goldman Sachs’ equity derivatives division in London. Charles-Edouard Joseph heads up the research team and, again, he was at Goldman in its investment banking division.
Its only front office recruit so far this year in London is Giulia Raffo, a former Citi equity researcher who was a partner at research boutique Autonomous until she joined Boussard & Gavauden earlier this month.