2016 FINANCIAL COMPENSATION SURVEYfiles.constantcontact.com/0d599bd1101/ae9c2055-389...survey,...

2016 FINANCIAL COMPENSATION SURVEY

FINDINGS AND RESULTS

November 2016

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Dear Colleagues,

As premier professional organizations for investment professionals, CFA Society Iowa and CFA Society Nebraska 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. This is the second year our Societies have participated in the survey, which 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,

Brett Peterson, CFAPresident, CFA Society Iowa

Joe Lionberger, CFAPresident, CFA Society Nebraska

2016 FINANCIAL COMPENSATION REPORT

LETTER FROM SOCIETY LEADERSHIP

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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 Iowa and Nebraska conducted earlier this year; 228 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.

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EXECUTIVE SUMMARY

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

$71,050$125,250

$90,250$164,890

Bachelor degree

Graduate degree

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RESPONDENT PROFILES

Years of experience< 2 years

2 – 5 years

5 –10 years

10 – 20 years

8.0%17.0%25.0%32.0%

20 + years 18.0%

EducationSome college but no degree

Associate degree

Bachelor degree

0.0%0.0%

47.4%Graduate degree

Doctorate50.9%

1.8%

98.0%of those surveyed report that

CFA® Charter designation has helped career

Charterholder status

67.0%Yes

12.0% No

21.0% Candidate

Feel valued by their company

83.0%Yes 1.3%

N/A

15.7% No

Feel fairly compensated

71.7%Yes

28.3% No

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RESPONDENT PROFILES

Opportunity for advancement within company

64.6%Yes

0.4% N/A

21.5% No

13.5% Not sure

Likelihood of looking for a new role in 2016

43.5%Unlikely

19.7% Likely

27.4% Very unlikely

9.4% Very likely

Employer size< 50

50 to < 250

250 to < 500

500 to < 2,500

18.0%11.0%7.0%

24.0%2,500 to < 5,000 5.0%

≥ 5,000 34.0%

AUM of firm< $500 million

$500 million to < $2 billion

$2 billion to < $10 billion

$10 billion to < $50 billion

7.0%15.0%15.0%8.0%

$50 billion to < $100 billion 11.0%≥ $100 billion 32.0%

Not applicable 11.0%

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RESPONDENT PROFILES

Fifteen most common occupations17.1%8.3%7.9%6.6%6.6%3.9%3.9%3.9%3.5%3.5%3.1%2.6%2.2%2.2%2.2%

Buy-side Research Analyst (fixed income)

Portfolio Manager (fixed income)

Financial Analyst (corporate)

Bank/Trust/Private Client Portfolio Manager

Chief Investment Officer

Accountant/Auditor

Manager of Managers

Portfolio Manager (equities)

Buy-side Research Analyst (equity)

Performance Analyst

Operations/Reconciliation

Actuary

Buy-side Trader (fixed income)

Consultant

Financial Advisor/Broker

Organization type32.0%31.0%16.0%8.0%4.0%3.0%3.0%2.0%1.0%

Investment Management Firm

Insurance Company

Investment Bank, Commercial Bank, Brokerage Firm

Other

Government Agency/Department

Consulting, Accounting, Law Firm

Endowment, Foundation, Other Not-for-Profit

Educational Institution

Family Office

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FINANCIAL COMPENSATION

Types of compensation in addition to base salary

86.0%85.0%15.0%13.0%

7.0%4.0%

Cash/Bonus Performance

Employer 401(k) Contributions

Profit Sharing

Restricted Stock Awards/Phantom Shares

Deferred/Multi-year Earnings

Commission/Sales Bonus

Stock Options 1.0%

Average ideal compensation structure for selected occupations

70.4% / 25.3% / 4.0% / 0.4%

65.6% / 27.2% / 7.2% / 0.0%

81.1% / 11.4% / 6.4% / 1.1%

63.6% / 17.5% / 13.6% / 5.4%

77.1% / 15.4% / 6.4% / 1.1%66.7% / 23.3% / 7.8% / 2.2%

76.1% / 14.9% / 7.9% / 1.1%

84.2% / 12.2% / 2.8% / 0.8%

62.5% / 30.6% / 6.9% / 0.0%

92.0% / 7.3% / 0.7% / 0.0%

Occupation

Buy-side Research Analyst (fixed income)

Portfolio Manager (fixed income)

Financial Analyst (corporate)

Chief Investment Officer

Bank/Trust/Private Client Portfolio Manager

Portfolio Manager (equities)

Manager of Managers

Accountant/Auditor

Buy-side Research Analyst (equity)

Operations/Reconciliation

Expected change in total compensation

Decline 4.0% Stay the same 12.0% Increase 10–20% 14.0% Increase > 20% 5.0%

64%Increase 0–10%

Base Cash bonus Long term Other

Overall firm performance 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

Buy-side Research Analyst (fixed income) 90,000 39 28,000 36 5,000 39 122,800 39

75th Percentile 121,450 76,125 9,365 191,700

Portfolio Manager (fixed income) 123,000 23 23,500 16 5,397 19 128,000 19

75th Percentile 168,500 138,750 14,350 298,875

Financial Analyst (corporate) 68,500 18 9,350 16 3,050 18 73,857 18

75th Percentile 97,500 13,500 4,375 123,000

Bank/Trust/Private Client Portfolio Manager 104,000 15 13,400 12 5,900 15 115,200 15

75th Percentile 140,500 28,725 13,500 185,825

Chief Investment Officer 171,370 15 125,000 8 2,000 15 236,000 15

75th Percentile 245,000 191,500 17,875 358,814

Note: Only Reported for positions with 10 or more responses.

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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 (fixed income) 90,000 9 26,000 9 8,000 9 122,800 9


Median total compensation for those with less than 5 years of experience is $72,000

Median total compensation for those with 5 to less than 10 years of experience is $114,778

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Note: Cells in gray reflect fewer than five responses.

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


Comp N




Bank/Trust/Private Client Portfolio Manager 136,000 5 4 10,500 5 158,500 5

Chief Investment Officer 171,370 5 2 5,500 5 194,400 5

Manager of Managers 148,800 5 4 10,000 5 188,800 5

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


Comp N


Chief Investment Officer 275,000 6 150,000 5 6,000 6 358,814 6

Portfolio Manager (fixed income) 200,000 5 4 10,000 5 505,000 5

Median total compensation for those with 10 to less than 20 years of experience is $162,000

Median total compensation for those with more than 20 years of experience is $240,500

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2014 vs 2015 compensation trend analysis

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

7.5% 14.1%

13.8%

34.4%

44.7%

40.6%

34.0%

10.9%

Very Likely Likely Unlikely Very Unlikely

$68,600

$72,000 $104,000

$114,778

$157,600

$162,000

$275,000

$240,500

< 5 Years 5 to < 10 Years 10 to < 20 Years 20 + Years

2014 2015

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SURVEY METHODOLOGY

Survey methodology

MethodAn online survey was deployed to known financial professionals in the region represented by CFA Society Iowa and CFA Society Nebraska. Email subscribers of CFA Society Iowa and CFA Society Nebraska and LinkedIn group members were specifically targeted. The survey was not limited to just these audiences. In addition, this survey was structured so all data gathered was anonymous, with no identifiable information requested.

RespondentsRespondents were financial and investment professionals, and totaled 228 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 uses sampling methodology and broadly defined positions, survey findings are not necessarily representative of the total population; rather, 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

About CFA Society Iowa and CFA Society Nebraska

The CFA Societies of Iowa and Nebraska are the premier professional organizations for investment professionals to connect with Chartered Financial Analysts throughout the region. 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.

Both CFA Society Iowa and CFA Society Nebraska:

• Promote ethical and professional standards within the investment industry,

• Encourage professional development through the CFA Program and continuing education,

• Facilitate the exchange of information and opinions among people within the local investment community and beyond, and;

• Work to further the public's understanding of the CFA designation and investment industry.

If you are interested in learning more about earning your charter, or to learn more about CFA Society Iowa and CFA Society Nebraska, contact [email protected] (Iowa) or [email protected] (Nebraska).

Follow CFA Society Iowa at:

Follow CFA Society Nebraska at:

mailto:iowacfa%40gmail.com?subject=

mailto:direx%40inebraska.com?subject=

https://www.linkedin.com/company/cfa-society-iowa

https://www.linkedin.com/groups/4207520/profile

https://twitter.com/CFAIOWA

https://twitter.com/cfa_nebraska

https://www.cfasociety.org/iowa

https://www.cfasociety.org/nebraska

https://www.facebook.com/CFAIowa

https://www.facebook.com/CFA_Nebraska-494143280789252/

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