London quant fund quadruples revenue, doubles pay
David Harding may or may not be letting out a sigh of relief – but the quants and mathematicians at his quant hedge fund, Winton Capital Management, definitely have.
Companies House disclosures show that staff of Winton Capital Management received average pay of £428k ($519k) per capita in 2022, a serious increase – more than a doubling – on the £207k ($251k) that Winton per head paid in 2021. That’s less than rival quant fund, Qube, but it's a pretty serious pay package, even in London, where hedge fund compensation can reach seven figures per head.
Revenue and profit were the main factors for the increase. The fund made £116m ($141m) in 2022, a colossal increase – nearly five-fold – from 2021’s £24m ($29m). That increased operating profit from a nearly £20m ($24m) loss to a £33m ($39m) profit.
That, clearly, had a knock-on effect on how the fund started paying its people. Although slimming the team ever so slightly (from 151 people to 147) helped bump up average pay figures at the fund a tiny bit, it doesn’t make a difference to the fact that the wage bill more than doubled (from £31m to £63m – or around $38m to $76m).
It’s worth pointing out that Winton doesn’t appear to operate a limited partnership subsidiary, which is how most London-based hedge funds (and international subsidiaries) pay their portfolio managers – so those figures are likely included in the firm’s wage bill.
Winton’s success this year is helping the quant fund to pave over some serious cracks. The start of the covid pandemic was a huge problem for the fund, which lost $26bn in assets from its peak in 2015 due to poor returns and client withdrawals. Most of that fall was a $12.5bn drop in 2020, the FT reported.
Founder David Harding welcomed the market volatility that sent markets “into a tailspin”, per Bloomberg, as an opportunity to recover some of the fund’s pride (and, more importantly, cash) that it lost after the 2020 debacle.
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