Hedge fund Point72 hiked London headcount 30% and cut pay
Usually when a company makes significantly less money than last year, it looks at reducing its headcount. Not hedge fund Point72, apparently.
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The fund’s London subsidiary, Point72 UK Limited, released its accounts for 2023 yesterday. They showed that, over the course of the year, the firm added 48 people in the city (going from 196 people to 254). The wage bill also went up, although not proportionally; average pay per head went from a pretty huge $819k per head in 2022 to a still huge $696k per head in 2023.
Although it might be fun to image that the people Point72 hired were simply cheaper than the ones it already had, falling pay per head might be related to performance bonuses instead. The London subsidiary brought in $441m in revenue, and made a profit of $77m, in 2022. For 2023, it brought in just $299m in revenue and made a loss of $21m.
Additionally, the firm’s “members”, UK legal jargon that is the equivalent of “partners” in the USA, decreased in number from 13 to just 9. Their distributable profit went from $11.3m per head to just $5.7m per head. In UK-based hedge funds, these “members” are usually portfolio managers. The implication, therefore, is that the firm hired more analysts and fired a few portfolio managers.
Luckily for the new joiners, there’s probably plenty of space for them. The firm expanded its St James Square office earlier this year, in what turned out to be a serendipitously timed event; Financial News reported earlier this week that physical space for hedge funds in the city was “tight”, with other multi-strategy funds like Citadel and Verition among the rivals bidding for office space.
Still, even after the losses and the pay dilution from headcount increases, Point72 is very well paid, even compared to other hedge funds in London.
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