Buy-side equity analysts in Europe earn roughly 30 percent less, on average, than their sell-side counterparts, according to Institutional Investor’s inaugural Europe Equity Buy-Side Compensation Report.
Last year buy-side analysts earned average total compensation of €198,886 ($290,317; paid in their local currencies but converted to euros for the purpose of comparison). That is 29.4 percent less than the average 2007 sell-side total of €281,687.
Such results are not surprising to Amanda Foster, a recruiter with executive search firm Russell Reynolds Associates in London. “Analysts will, in some cases, take a 50 percent cut in total compensation to make that move from the sell side to the buy side,” says Foster, noting that researchers are drawn to the buy side by the appearance of greater stability and the opportunity “to put their recommendations into play.”
Moreover, the pay gap is slowly widening in favor of the sell side. Last year buy-side analysts earned, on average, 13.8 percent more than they did in 2006. Sell-side researchers’ paychecks increased by 14.9 percent, the survey found. On average, analysts on both sides expect their compensation to increase by slightly more than 11 percent this year.
European sell-side equity analysts averaged a base salary of $127,181 and a bonus of $201,065, or 61.3 percent, for average total compensation of $328,246.
