By Tatiana Bautzer
NEW YORK (Reuters) -Wall Street stock and bond traders can expect their bonuses to jump 10% to 30% this year as they cashed in on turbulent markets, according to a quarterly report by compensation consultancy Johnson Associates.
“All the uncertainty around the tariffs and the continuous upheaval favors volatility and traders,” said the consultancy’s founder, Alan Johnson.
Other financial employees will not fare as well, with compensation expected to be flat or slightly higher, according to the report.
Wealth management and hedge fund executives are estimated to see bonus increases of up to 5% for 2025, while asset managers will likely get bumps of 2% to 7.5%, helped by recovering markets and inflows of client funds.
“Some of the worst effects of the unpredictable U.S. government policies have faded as markets rebounded,” Johnson said. He characterized 2025 as a “regular” year for compensation, improving from the bad outlook when the new U.S. import tariff policy was announced.
Payouts for investment bankers will likely remain muted, even though initial public offerings and M&A deals may rebound in the second half of the year, Johnson said.
Because investment banking fees are paid when deals close, which can take months, the compensation for advisory bankers is expected to remain flat or rise a modest 5% for this year. If the deal activity remains elevated, compensation could improve for 2026, Johnson said.
Executives involved with secondary offerings within private equity funds have seen more activity, which could boost their compensation by 10%.
Private credit is another area in which payouts could climb 7.5% as asset managers expand their lending activities.
(Reporting by Tatiana Bautzer; editing by Lananh Nguyen and Leslie Adler)
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