Ladies and gentlemen, rest assured that I do not read the British lifestyle magazine Trader Monthly on a regular basis. Imagine a combination of Forbes, Stuff, and GQ and you can probably imagine its contents. While visiting a rather well-to-do relative, however, I came across this particular magazine. Something that caught my attention among the endless articles about shorting housing stocks, £40,000 wristwatches, and £3,000 power suits [what, there are women traders?] was a 2007 Bonus Survey projecting "average compensation levels for top-performing trading professionals at major banks globally, based on the best information available." The results, while unsurprising, are interesting for a number of reasons.
Let's begin with the new dregs of the trading world, those who trade mortgage-backed securities:
Bonuses are down across the board for these folks in 2007. In the meantime, all isn't hunky-dory for those who need to package these mortage-backed securities and the like into collateralized debt obligations and other sorts of weapons of financial destruction:
Things ain't too hot either in asset-backed securities or collateralized mortgage-backed securities (for commercial real-estate):
So in what asset classes are traders doing well? According to the survey, investment grade traders are doing well as folks flee subprime-related riffraff. Emerging markets ain't doing too badly, either (see the online article for more). However, the ones who take the cake are, drum roll please...the commodities traders. As if that's any wonder:
I very much suspect that layoffs will hit more traders in the first three asset classes mentioned above sooner or later. Better buy a metal detector and hunt for gold, Charlie, like those crazed Californians.
Let's begin with the new dregs of the trading world, those who trade mortgage-backed securities:
Bonuses are down across the board for these folks in 2007. In the meantime, all isn't hunky-dory for those who need to package these mortage-backed securities and the like into collateralized debt obligations and other sorts of weapons of financial destruction:
Things ain't too hot either in asset-backed securities or collateralized mortgage-backed securities (for commercial real-estate):
So in what asset classes are traders doing well? According to the survey, investment grade traders are doing well as folks flee subprime-related riffraff. Emerging markets ain't doing too badly, either (see the online article for more). However, the ones who take the cake are, drum roll please...the commodities traders. As if that's any wonder:
I very much suspect that layoffs will hit more traders in the first three asset classes mentioned above sooner or later. Better buy a metal detector and hunt for gold, Charlie, like those crazed Californians.
