In theory, working for a high frequency trading firm is a) fun and b) extraordinarily lucrative. High frequency traders allegedly work shorter weeks than traders in investment banks and get paid more for them. Not all high frequency traders are equally remunerative, however.
Maven Securities, a London based high frequency trading firm with around 13 employees, has just released its accounts for the year ending June 2015. They reveal that compensation per head increased 13% between 2014 and 2015, but that Maven still paid a ‘mere’ £144k ($204k) per head.
As a reminder, Credit Suisse (the only bank to break out pay for salespeople, traders and support staff specifically) paid an average of CHF263k ($275k) to people in its global markets division in 2015. Goldman Sachs paid an average of $345k across the firm.
Nor do Maven’s 13 employees appear especially productive. In 2015, they generated revenues of £2.6m – an average of £198k per head. Credit Suisse’s 13,000 markets professionals generated an average of CHF569k (£419k) each by comparison.
Maven does, however, have a secret sauce. Last year, it generated an additional £3.3m of, “investment income,” which doesn’t count as revenue. This sounds impressive (and makes Maven seem more of a hedge fund than trading firm) – except that particular component of Maven’s activities isn’t doing well at all – investment income was 68% higher at nearly £10m one year earlier.
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Photo credit: Top Speed by Richard Carter is licensed under CC BY 2.0.