The vast majority of large UK hedge funds have slashed pay for their rank-and-file employees, while many have protected the remuneration of their most senior staff after many struggled to replicate revenues of previous years.

Based on analysis of the latest accounts of top UK-based hedge funds, most firms have been cutting compensation on an average pay-per-head basis, even if they have been expanding headcount. Times are tough for hedge funds, which have struggled against investor redemptions, talent shortages andjustification of sky-high fees. While many have cut costs bymoving out of expensive Mayfair office space, theyve also been clamping down on pay.

The highest paying London-based hedge fund isCaxton Associates,our research suggests. It paid an average of $892k last year, according to accounts released in May 2017, which is down from around $1.2m in 2015. Caxton posted profits of 95.7m ($125.9m) last year – a massive leap of 504%on the previous 12 months. This has funnelled towards its partners,who took home an average of $4.94m in 2016, up from $1.34m in 2015.

One notable new entry isBalyasny Asset Management, the Chicago-headquartered hedge fund that has been hiring extensively in the UK. Its London headcount increased by 86% last year, and it was one of the few hedge funds to increase pay for its employees – to an average of $824.8k, or 23% up on 2015.Citadelhas also been hiring – it increased its UK headcount by 30% last year – but its been paying less. It paid an average of $666.4k last year, down from $748.9k in 2015.

Bluecrest Capital Management, a hedge fund turned family office managing the wealth of its partners, has been drastically cutting its headcount. It showed 89 people the door last year, but has still increasedcompensationon an average pay per head basis – from $345.3k to $457.4k last year.

With the exceptions of Man Group and Och-Ziff Asset Management, none of the hedge funds in our rankings are publicly-listed companies. This means that the figures come from Companies House in the UK and, in the majority of cases, relate to 2016. UK hedge funds tend to operate through a limited liability partnership, which houses their senior staff, and then a network of other companies. The latter contain information on rank and file employees.

Hedge fund pay remains something of an enigma. While most assume that a switch to the buy-side will result in abig pay rise with the potential of a seven-figure bonus, the compensation figures suggest that investment banking pay remains competitive. At Goldman Sachs in London, for example, its 5,903 employees earned an average of $503.8 in 2016. Meanwhile, figures released earlier this year relating toGoldmans regulated employees 512 regulated employees in London, show an average payment of $1.1m.

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