Futures For Kids have raised in excess of £1 million since their inception in 2008, and continue to go from strength to strength.

Please follow this link for more information about the charity and how to ge involved.

http://futuresforkids.org.uk/

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The Risk Market 2011 & Anticipated Uplifts for 2012

The LME Metals seminar is held at the beginning of LME Week and provides an insightful perspective on the major issues facing the global metals industry in the coming year.

This year, presentations & case studies were featured from a wide range of Utilities, Energy Companies, Investment Banks, Hedge Funds & Proprietary Trading Houses.

Please click here for more information about the event.

http://www.ft.com/cms/s/0/515c84e2-e04b-11e0-ba12-00144feabdc0.html

Is headhunting a popular career choice among graduates?

Headhunting is seen as a strong option for graduates who are bright, hard working and are interested in dealing with people. It has become a popular career choice as it provides excellent earning potential, quick career progression and the ability to build good business acumen.

How have they traditionally viewed the profession?

This has been a market that graduates have not known very much about. However, during the last decade, their awareness of the industry has strengthened. Graduates are now coming to the market with a better understanding of the differences between the “reactive” nature of recruitment, and the “proactive” nature of executive search and headhunting. Once they understand these differences they are often attracted to its merits.

Are their views changing?

Financial headhunting in the UK is more developed than anywhere else in the world. More graduates now know people who have gone into the industry, and often achieving great success in their roles. Thus, the profession is now considered to offer a much longer term career option.

Are they keen to specialise?

Most graduates tend to be quite keen to specialise in one sector as they see the benefit of developing a niche network and becoming an expert in one market. Specialisation usually leads to faster delivery and progression. In the changeable nature of the markets, it is important to have a degree of flexibility in order to evolve with the requirements of the clients.

Which sectors are popular?

Within financial services, the front office sectors are very popular with lucrative tickets on offer, but these markets are naturally seasonal, and tied to bonus periods and are often very difficult to break into. Middle office positions such as risk and change management are becoming prevalent, due to current changes in regulation and control of the financial industry.

What attributes and qualifications do they need?

Formal qualifications are not required. The most important attributes are confidence, good communication skills, the aptitude to learn quickly and the intention to work hard.

What training is needed?

Training covering the complete recruitment process and developing good business skills is essential for any graduate coming into this role. Learning the technical jargon and understanding the fundamental drivers of the financial markets is also imperative and takes application. The ability to converse on a technical level is very important to gain credibility with both prospective candidates and clients.

What sort of work can they begin with?

Typically, graduates would start with candidate-driven work such as identifying new candidates and “mapping” specific markets. As their understanding of the industry develops, so would their exposure to the markets, accompanying senior consultants on meeting candidates and later on with client briefs. The nature of the industry benefits those who want to immerse themselves in the market, assimilating information and knowledge rapidly.

How do career headhunters compare with “stop-gap” candidates?

Headhunting equips individuals with a wide range of transferable skills, and so “stop-gap” candidates can often see this as an industry where they can quickly make money and develop their business skills. Increasingly, career headhunters seize the opportunity to develop their roles quickly, establish themselves as leaders in their market and are able flourish over the long term. Invariably you can track individuals returning to headhunting and search after a stint on the “client side”.

Giles Turner – Financial News

04 Jul 2011

Investment bankers have often been cast as overpaid demons in human form, while mainstream asset managers have managed to escape the unrelenting public ire. However, although asset managers appear to be paid less, it is not obvious from their 2010 financial statements that they offer better returns for shareholders. Are both overpaid?

Financial News examined the ratios of total compensation to number of employees, and the returns on historical equity, of each of the largest listed asset managers and the largest asset management arms of investment banks, for the past year.

The meaning of any comparisons between them will inevitably be obscured by the lack of homogeneity between the companies, with one asset manager outsourcing functions where another employs low-salary staff, to give just one example, and by the effect of inflation on equity raised in different years in different currencies. However, these are the figures that are seen by the public, and by the politicians that ultimately determine the regulations asset managers have to comply with.

The 2010 financial statements of the selected asset management companies show their total compensation bill per employee increased last year by 17.2%, to $281,100. The return on historical equity came out at 17%. Meanwhile, last year’s average compensation at six investment banks (JP Morgan, UBS, Credit Suisse, Morgan Stanley, RBS and Deutsche Bank), published by Financial News in March, came out at $406,000. Their average return on historical equity was 19%.

The asset management company with the highest ratio of pay to number of employees last year was Morgan Stanley Investment Management, at $449,200 per employee. Return on historical equity at the bank’s asset management arm was 9%. Morgan Stanley declined to comment on why the ratio was so high, relative to the other asset management companies in the sample, last year.

Morgan Stanley’s ratio was almost double the maximum base salary at Jupiter. A Jupiter spokesperson said: “We have a general policy of capping base salaries at £250,000 with competitive positioning of total compensation through the use of short and long-term incentives. We believe employees’ and shareholders’ interests are best served by containing fixed costs and increasing the proportion of total compensation that is directly performance related.”

Jupiter’s return on historical equity for 2010 was 14.87%.

UBS Global Asset Management topped the league table measuring compensation ratios – compensation as a percentage of revenues – which climbed to 53.3%, 10 percentage points above the asset management average, and approaching the ratio typically found at hedge fund management firms, where the majority of revenue is paid out to employees. Last year, hedge fund manager GLG’s compensation ratios reached 65%.

A spokesperson for UBS said personnel costs had increased from 2009 to 2010 “mainly due to increased expenses for prior years’ deferred variable compensation”.

UBS Global Asset Management beat the average return on historical equity for asset managers by three percentage points, returning 20%.

Of the largest US-listed asset managers, T Rowe Price had the lowest ratio of compensation to number of employees last year, at $170,309 per employee. The Baltimore-based asset manager also had the second highest return on historical equity.

Burton Malkiel, Princeton University economist, board member at Vanguard, and author of A Random Walk Down Wall Street, believes asset managers are paid too much. He said: “The investment management business is a great business for those who are collecting fees, but they are too high.”
Asset manager pay is often related to performance, and markets performed well in 2010. But a member of the public might observe that the increase of 17.2% in the ratio of total compensation to number of employees, from 2009 to 2010, compares with an 11.37% increase in the S&P 500 and an 8.28% increase in the FTSE 100 indices.

Tim Wright, PricewaterhouseCoopers’ remuneration director, said: “On the whole, asset managers are paying more than they did last year because things are better for most of them. They are making more money.”

The good times are also set to continue for asset managers. Wright said: “We have some anecdotal information showing that things are better than they were last year and I expect to see another increase in compensation levels this year.”

Charlotte Richards, asset management headhunter at Webber Chase, said: “Over the past six months, we have seen salaries going up by around 20% to 30%.”

Dissatisfaction with pay growth across the asset management industry led Calpers, America’s largest pension fund, and the New Jersey State pension fund to negotiate discounts and fee reductions from their managers – although this was principally among alternative asset managers, such as those running hedge funds. In February, New Jersey managed to claim $40m in fee reductions from managers in its alternative investment portfolio.

The ratio of compensation to revenue at asset management companies last year came out at about the same as it did at investment banks: 40.29% at asset management companies, compared with 39.4% at the investment banks.

Payout ratios, that is, compensation as a multiple of pre-tax profits, were also similar. At the selected asset managers, the average payout ratio was 1.31 times pre-tax profits, while the average at investment banks, published by Financial News in March, was 1.3. In other words, for every $1m generated in pre-tax profits, asset managers had spent $1.31m on staff compensation.

The ratio of total compensation to number of employees was highest last year at Morgan Stanley Investment Management, Credit Suisse Asset Management and UBS Global Asset Management, each of them owned by banks.

Among the bank-owned managers, the ratio was lowest last year at JP Morgan, where it stood at $222,426. The return on historical equity was 26% in 2010. JP Morgan declined to comment.

Good pay does not always create a magnet for talent. One asset management headhunter said Investec, Goldman Sachs Asset Management and Pimco remained the gold standard for prospective employees. The headhunter said: “It is not about the salary, but more about the brand.”

Giles Turner – 08 Jun 2011

Reduced cash bonuses and downsizing of commodities desks has led to a surge in the number of traders leaving banks for commodities groups, such as Switzerland’s Glencore, with recent windfalls promising to drive the trend.

Commodities traders are moving to trading houses such as Glencore as investment banks scale down their own commodities desks, and traders look for upfront remuneration.

Douglas Ferguson, head of commodities at recruitment agency Webber Chase, said: “The main reason why some banks were forced to make cuts across commodities in 2010 was because revenue and performance were down relative to previous years. The fact that proprietary trading activities are also being curtailed has exacerbated this trend.”

While trading houses have been steadily growing, one headhunter said: “The investment banks have been seen as a little unreliable at staying the course.”

Recent moves from investment banks to trading houses include Phil Sutterby, head of gas trading at BarCap, who recently joined Mercuria taking two senior traders with him, according to a headhunter. Mercuria declined to comment. BarCap did not return requests for comment. A spokesperson from Credit Suisse also confirmed the move of Meindert Witteveen, previously head of coal and freight trading at Credit Suisse, who has joined Cargill subsidiary Black River.

The prospect of cash or share-based windfalls resulting from equity stakes in independent trading houses is also proving a draw for some former bank traders, according to sources familiar with the situation. That sentiment has been fuelled by last month’s initial public offering of Glencore, whose six top executives saw the value of their stakes hit $23bn, with chief executive Ivan Glasenberg’s 15.8% stake alone worth potentially $9.5bn.

One metal trader at a London-based investment bank said: “In commodities, the allure of equity stakes in growing private physical houses with strong return on equity and profit growth is very strong. It is even stronger when you think that banks are restricting cash bonuses and cutting down their prop trading desks.”

Commodity trading houses such as Trafigura and Vitol pay their entire bonuses in cash according to an industry source, unlike their investment bank counterparts, who have been forced by regulators to increase the portion of bonuses deferred or paid in shares.

One headhunter said: “If you can get an early stake in an independent company, it would not be a bad move, and trading houses such as Mercuria and Gunvor have only grown in recent years.”

Mercuria has grown from 600 employees in 2008 to over 800 today.

Among other recent moves are those of Greg Hamilton, head of Asian coal trading at Goldman Sachs, who moved to Mercuria in March, the bank confirmed, and Steven Chiang, director and head of crude oil and refined products for Asia-Pacific at Barclays Capital, who reportedly resigned in March to join Glencore, according to Reuters. For a list of other moves, see graphic, right.

Denis Bajolle, head of continental power trading at BarCap, also left last week to join Noble as head of European power, according energy industry newsletter SparkSpread. BarCap declined to comment.

Nomura downsized its oil and soft commodity trading teams in March, sources familiar with the situation told Financial News at the time. Jason Tudor, Nomura’s European head of global commodities, left the firm earlier this year as the bank made an internal shift from physical trading to research, according to a company spokesman. Nomura last week hired Morgan Stanley’s oil and gas research team.

Ferguson said: “The front-line traders who make lucrative sums for the commodities desks of banks have now got to make the decision whether to stay put and ride out the new deferred bonus structure, or take an immediate hit against a possible longer term gain by moving to a trading house where they could earn much greater sums.”

However, in order to take up employment at trading houses such as Mercuria and Glencore, traders would have to move to Geneva or Zug. One headhunter said such a move would be “awful” for traders with family commitments. He added: “There is nothing to do in places like Zug.”

Trafigura has recently moved its oil trading operations from London to Geneva.

The awards, sponsored and published by the Sunday Times, are a direct reflection of employee sentiment, as they have been solely evaluated through interviews with our staff.  The areas against which we have been measured include:

• Leadership - How employees feel about the head of the organisation, senior managers, and the organisations values and principles
• My Manager – How employees feel about and communicate with their direct manager
• Personal Growth – What employees feel about training and their future prospects
• Wellbeing – How employees feel about stress, pressure at work, and work life balance
• My Team – Employees feelings towards their immediate colleagues and how well they work together
• Giving Something Back – The extent to which employees feel their organisation has a positive impact on society
• My Company – The level of engagement employees have for their job and organisation
• Fair Deal – How happy employees are with their pay and benefits

We are therefore extremely proud of this award as we feel it reflects the progressive and supportive culture we have developed at Webber Chase.