Lessons for asset managers from the bankers

Asset managers who rip off their clients should look at what happened to the bankers, says John Stepek.

Who has benefited most from quantitative easing (QE)? You might say bankers and you could argue that being saved from oblivion with reams of printed money is something to be very grateful for.But if we're talking salaries here, investment banking pay has fallen hard (in real terms, at least) since 2006, according to the Financial Times. No, the real winners from QE have been asset managers the people who invest our money on our behalf.

A study out last week by think tank New Financial looked at "average compensation cost per employee". Between 2006 and 2014 the average cost of an investment bank employee fell by 25% to $288,000. Meanwhile, the average cost of asset management staff rose by 22% to $263,000.If that continues, says the FT, asset managers will overtake the investment bankers by this time next year.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.