Clipped bonuses for hedge fund managers

Turmoil in the credit markets have taken a bite out of the bonuses for hedge fund managers this year, according to a report. Cash bonuses paid out to hedge fund managers are seen increasing between 1% and 9% from the previous year, marking a "substantially lower" increase than predicted before the credit crunch, according to the 2008 Hedge Fund Compensation report, which was released yesterday by Glocap Search LLC, Institutional Investor News and Lipper HedgeWorld. Just last June, Glocap had been predicting an increase in bonus size of between 18% and 20% in June. Still, hedge fund managers aren’t going hungry: Average total compensation for investment professionals with 10 years or more of experience at hedge funds with $10 billion or more in assets under management is expected to hit $2.35 million this year. Meanwhile, the average total compensation for investment professionals with between one and four years of experience at funds with between $1 billion and $3 billion in assets under management is estimated to come in at just over $330,000. Lipper HedgeWorld, Glocap and Institutional Investor News are based in New York.