2016 FINANCIAL COMPENSATION SURVEY - CFA Institute · 2 2016 FINANCIAL COMPENSATION REPORT EXECUTIVE SUMMARY Executive summary Access to accurate and data-driven information plays

2016 FINANCIAL COMPENSATION SURVEY

FINDINGS AND RESULTS

November 2016

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2016 FINANCIAL COMPENSATION REPORT

LETTER FROM SOCIETY LEADERSHIP

Dear Colleagues,

As premier professional organizations for investment professionals, the CFA Societies of Florida are dedicated to being reliable and trustworthy sources of information. Each Society strives to serve members by providing them the resources to aid in their career development and advancement.

We are excited to announce the highly anticipated findings of the 2016 Financial Compensation Survey. The survey, which had been void in the market since 2007, provides a region-specific analysis of compensation levels for investment and financial professionals. This whitepaper captures the findings of the survey, providing an overview of the survey-wide results.

For those who participated in the survey, we thank you for your contribution to this important market resource. We are confident the information contained in this document will be of value to you.

Regards,

Chris Squittieri, CFA President, CFA Society Naples

Matt Hansen, CFAPresident, CFA Society Orlando

Ursula Auger, CFAPresident, CFA Society South Florida

Benjamin Padilla, CFAPresident, CFA Society Tampa Bay

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EXECUTIVE SUMMARY

Executive summary Access to accurate and data-driven information plays a significant role in the ability of financial and investment professionals to effectively perform in their careers. The same is true to successfully advance one’s career.

The 2016 CFA Societies Financial Compensation Survey seeks to provide access to this vital information. This report is a compilation of the results from a survey on compensation practices in Naples, Orlando, South Florida and Tampa Bay conducted earlier this year; 255 professionals completed the survey.

Remaining true to the stated commitment to provide an accurate snapshot of the compensation levels for the entire financial and investment industry, the survey findings are presented to demonstrate compensation based on the most popular positions and other demographics.

The survey requested self-reported data on numerous aspects of compensation. In addition to covering base salary and total compensation, the survey addressed the respondent’s CFA Charterholder status, level of education, and occupation. Information on the type and size of the firm as well as the amount of assets under management were included in the survey. The survey captured annual salary change data and the respondent’s view on the adequacy of compensation and the desire to explore other job opportunities.

The 2016 Financial Compensation Survey data and exhibits are intended to provide general guidance for comparing compensation levels with overall values for key categories. Note that actual compensation potential may vary relative to the numbers generated by the survey given the use of relatively broad category definitions. Also, the estimation of compensation based on any single factor may not predict reasonably accurate estimates. Details surrounding actual job responsibilities and the confluence of multiple factors may result in higher or lower compensation levels.

Median total compensation

Non-Charterholder CFA Charterholder

Our data show that professionals who attain the CFA designation and/or a graduate degree tend to have higher compensation levels.

$82,900$161,000

$129,000$192,650

Bachelor degree

Graduate degree

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RESPONDENT PROFILES

Years of experience< 2 years

2 – 5 years

5 –10 years

10 – 20 years

7.0%11.0%29.0%28.0%

20 + years 26.0%

EducationSome college but no degree

Associate degree

Bachelor degree

0.8%0.4%

50.2%Graduate degree

Doctorate45.9%

2.7%

96.5%of those surveyed report that

CFA® Charter designation has helped career

Charterholder status

67.0%Yes

13.0% No

21.0% Candidate

Feel valued by their company

73.9%Yes 3.7%

N/A

22.4% No

Feel fairly compensated

69.2%Yes

30.8% No

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RESPONDENT PROFILES

Opportunity for advancement within company

51.4%Yes

6.1% N/A

25.3% No

17.1% Not sure

Likelihood of looking for a new role in 2016

40.0%Unlikely

20.4% Likely

22.9% Very unlikely

16.7% Very likely

Employer size< 50

50 to < 250

250 to < 500

500 to < 2,500

34.0%17.0%4.0%8.0%

2,500 to < 5,000 4.0%≥ 5,000 35.0%

AUM of firm< $500 million

$500 million to < $2 billion

$2 billion to < $10 billion

$10 billion to < $50 billion

18.0%9.0%

13.0%12.0%

$50 billion to < $100 billion 3.0%≥ $100 billion 26.0%

Not applicable 19.0%

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RESPONDENT PROFILES

Fifteen most common occupations12.9%12.5%9.0%7.8%4.7%3.9%3.1%3.1%3.1%3.1%2.7%2.7%2.4%2.0%2.0%

FinancialAdvisor/Broker

Bank/Trust/Private Client Portfolio Manager

Financial Analyst (corporate)

Portfolio Manager (equities)

Chief Investment Officer

Private Client Professional (other)

Accountant/Auditor

Manager Research (equity)

Performance Analyst

Portfolio Manager (indexed/other)

Buy-side Research Analyst (equity)

Consultant

Portfolio Manager (fixed income)

Chief Executive Officer

Institutional Sales Representative/Relationship Manager

Organization type38.0%26.0%19.0%8.0%3.0%2.0%2.0%1.0%1.0%0.0%

Investment Management Firm

Investment Bank, Commercial Bank, Brokerage Firm

Other

Consulting, Accounting, Law Firm

Family Office

Educational Institution

Insurance Company

Hedge Fund or Fund of Hedge Funds

Corporate Plan Sponsor

Government Agency/Department

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FINANCIAL COMPENSATION

Types of compensation in addition to base salary

82.0%76.0%21.0%17.0%14.0%6.0%

Cash/Bonus Performance

Employer 401(k) Contributions

Profit Sharing

Restricted Stock Awards/Phantom Shares

Commission/A Sales Bonus

Deferred/Multi-year Earnings

Stock Options 4.0%

Average ideal compensation structure for selected occupations

72.3% / 21.7% / 5.5% / 0.5%

55.8% / 29.8% / 4.6% / 9.8%

80.8% / 13.0% / 5.0% / 1.2%

72.9% / 20.8% / 6.1% / 0.3%

61.7% / 23.3% / 7.5% / 7.5%65.0% / 27.5% / 6.0% / 1.5%

68.6% / 21.4% / 9.4% / 0.6%

86.1% / 10.8% / 3.0% / 0.1%

73.1% / 20.0% / 6.3% / 0.6%

77.1% / 17.9% / 1.4% / 3.6%

Occupation

Bank/Trust/Private Client Portfolio Manager

Financial Advisor/Broker

Financial Analyst (corporate)

Portfolio Manager (equities)

Chief Investment Officer

Private Client Professional (other)

Manager Research (equity)

Performance Analyst

Portfolio Manager (indexed/other)

Consultant

Expected change in total compensation

Decline 2.0% Stay the same 22.0% Increase 10–20% 21.0% Increase > 20% 8.0%

46%Increase 0–10%

Base Cash bonus Long term Other

Discretionary and business unit/division performance were the top two determinants of bonus

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Median and 75th percentile total compensation by occupation

Base N Bonus N Other Comp N Total

Comp N

Financial Advisor/Broker 69,000 29 31,500 24 8,500 33 135,000 33

75th Percentile 100,000 91,859 35,500 245,000

Bank/Trust/Private Client Portfolio Manager 154,500 32 33,000 29 16,040 32 205,005 32

75th Percentile 182,500 50,000 35,050 277,250

Financial Analyst (corporate) 63,000 23 5,000 18 2,500 23 72,000 23

75th Percentile 81,750 9,750 5,500 95,850

Portfolio Manager (equities) 125,000 19 30,000 15 9,900 20 152,000 20

75th Percentile 150,000 50,000 21,000 233,475

Chief Investment Officer 192,500 12 60,000 11 27,500 12 342,500 12

75th Percentile 237,500 100,000 66,500 387,500

Private Client Professional (other) 114,000 10 21,000 8 6,355 10 163,855 10

75th Percentile 180,000 53,750 13,250 209,725

Compensation satisfaction vs. likelihood of looking for new job

Individuals who do not feel they are fairly compensated report they are more likely to look for a new job than their counterparts who believe they are fairly compensated.

Fairly compensated Not fairly compensated

8.9% 33.8%

13.1%

36.4%

48.2%

22.1%

29.8%

7.8%

Very Likely Likely Unlikely Very Unlikely

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Reported median compensation for those with less than 5 years of experience for selected occupations


Comp N



Reported median compensation for those with 5 to less than 10 years of experience for selected occupations


Comp N




Buy-side Research Analyst (equity) 115,000 5 47,000 5 5,000 5 165,450 5

Median total compensation for those with less than 5 years of experience is $70,500

Median total compensation for those with 5 to less than 10 years of experience is $111,500

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Median total compensation for those with 10 to less than 20 years of experience is $176,250

Median total compensation for those with more than 20 years of experience is $274,000

Reported median compensation for those with 10 to less than 20 years of experience for selected occupations


Comp N


Portfolio Manager (equities) 130,000 9 46,000 7 8,000 9 225,000 9



Reported median compensation for those with more than 20 years of experience for selected occupations


Comp N




Chief Executive Officer 4 3 100,000 5 462,000 5

Portfolio Manager (equities) 128,000 5 3 20,000 5 171,800 5

Note: Cells in gray reflect fewer than five responses.

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SURVEY METHODOLOGY

Survey methodology

MethodThe CFA Societies of Naples, Orlando, South Florida and Tampa Bay shared an online survey with financial professionals in their respective market areas. The survey was structured so all data gathered were anonymous with no identifiable information requested.

RespondentsRespondents were financial and investment professionals, and totaled 255 unique and completed responses.

TimingThe survey was active from April 18 – May 13, 2016.

AssumptionsThe findings from this survey were derived from self-reported data. Because the survey used sampling methodology and broadly defined positions, survey findings are not necessarily representative of the total population. The survey is designed to provide general information about pay levels within the industry. Earning any degree or professional designation is no guarantee of employment or compensation.

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About the CFA Societies of Florida

The CFA Societies of Florida are the premier professional organizations for investment professionals to connect with Chartered Financial Analysts throughout the state. Each Society strives to serve its broad membership through relevant educational programs, membership support services and opportunities for advancement such as networking events, discounts on educational materials, and more.

If you are interested in learning more about earning your charter, or about the CFA Society in your area, please click on any of the images below.

Follow CFA Naples at:

Follow CFA Orlando at:

Follow CFA South Florida at:

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ABOUT THE SOCIETIES

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https://twitter.com/cfaorlandofl

https://twitter.com/cfasfl

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https://www.cfasociety.org/orlando

https://www.cfasociety.org/naples

https://www.cfasociety.org/southflorida/Pages/default.aspx

http://www.cfatampabay.org

Documents

2016 FINANCIAL COMPENSATION SURVEY - CFA Institute · 2 2016 FINANCIAL COMPENSATION REPORT EXECUTIVE SUMMARY Executive summary Access to accurate and data-driven information plays