I was speaking to a contact on the buyside.He works for the Investment arm of an insurance company.He said something that left me slightly baffled.He mentioned that the salaries for Research are higher on the Sellside vs the Buyside.He has himself moved from the Sellside where he was a Research Analyst in a BB. I was tempted to ask him why he moved to the buyside if that was the case but I thought he might find that a bit too intrusive. All along I thought that compensation on the buyside was higher than the sellside.I guess it also depends on the “type” of buyside ( HF’s vs mutual funds etc.) ???
Traditionally sell-side stuff is more connected to sales, so it pays better (if you sell). There’s been some change in that lately. The buy-side traditionally has better work-life balance, but that usually means that you’re working 12 hour days instead of 16 hour days.
You have to compare jobs directly. Of course a big name sell-side analyst is going to make more than an entry level mutual fund analyst. However an experienced hedge fund analyst working for a large profitable fund is going to make multiples more than any sell-side guy.
Sell-side fixed salary is above buy-side fix salary, on average Buy-side bonus however, is multiples times sell-side bonus, on average Therefore: YOu are better off working for the sell-side (if u want stability) rather than a mediocre buy-side shop, on average Its not true that sell-side is more hrs. Just around results time can be harsh, other than that its not that bad.
Also, insurance companies and banks tend to pay lower than investment advisors.
JohnThainsLimoDriver Wrote: ------------------------------------------------------- > You have to compare jobs directly. Of course a big > name sell-side analyst is going to make more than > an entry level mutual fund analyst. However an > experienced hedge fund analyst working for a large > profitable fund is going to make multiples more > than any sell-side guy. This is totally true…it’s really variable. When I was in sell-side research at BB banks, sub-VP level were generally making somewhere between $100K-240K all in, with lower end of the range being first or second year BA’s and the upper end being the top associates (many of whom had MBA’s, but some of whom did not). At the time, the income ranges were pretty reliable – you could expect to make a generally stable income, but if you really wanted to hit it out of the park in an analyst role, you’d have a better chance of doing that a top buy-side shop as memalos pointed out. That being said, salaries are probably a lot lower these days. Just remember that in both the buy-side and the sell-side, what you get paid is tied on some level to how the firm does. So I have friends that are at top sell-side banks as well as top funds who received paltry bonuses this year simply because 2008 was so bad. Anyway, to sum it up, you definitely have more upside at a large buy-side firm, but small buy-side firms can often pay less than bulge bracket banks. The fact that your friend that works for an investment arm at an insurance company makes less than what sell-side associates may make at a top bank isn’t all that surprising, given that the types of securities he probably helps analyze aren’t that “sexy” and may not have as much upside (or, I guess you could say they have a more moderate risk-reward profile). Hope this helps…