Asset Manager Team Compensation Set to Increase Despite Market Volatility, Uncertainty

Wall Street year-end incentives are expected to be flat to slightly positive across all sectors for 2026, despite geopolitical turmoil and stress in the credit markets, according to a report from Johnson Associates, a financial services compensation consultant.  

“I think certainly some of the gloss is off of private equity,” says Alan Johnson, founder of Johnson Associates. “If you were to go back five years, you would say everyone wants to work in a PE firm. The pay dynamic [was] clearly much better than anywhere else. Fast forward to today, … the pay dynamic is not clearly as good, and certainly banks and others are paying a lot more than they did, so that dynamic has changed.” 

Additionally, hedge funds are in a talent war for star portfolio managers and elite quant talent, driving up compensation and, for some, resulting in bonuses in the tens of millions. 

“I think [hedge funds have] benefited from the slowdown in private equity. I think a lot of clients—pension funds, wealthy investors—feel overexposed to private equity, and that has benefited two sectors,” Johnson says. “One is hedge funds, if [investors] say, ‘I am in the major alternative asset classes, I’m already overweight to private equity, so I’m going to shift some of my portfolio to hedge funds.’ The other beneficiary from the slowdown in private equity is secondaries.” 

Chief Investment Officer / May 7, 2026