The 20 best-performing hedge fund managers of all time earned $ 63.5 billion for investors during the market turmoil driven by the coronavirus in 2020, making it the industry’s best earnings year in a decade, despite 12 tough months for American giants Bridgewater Associates and Renaissance Technologies.
The top 20 managers, led by funds that include Chase Coleman’s Tiger Global and Izzy Englander Millennium Management, made half of the overall earnings from the hedge fund industry last year, according to research by LCH Investments – a managed hedge fund. by the Edmond de Rothschild Group.
The gains highlight how some of the biggest names in the industry were able to navigate last year’s volatility, when the S&P 500 recorded its fastest fall in a bear market. Many were able to profit from the opportunities presented in the March liquidation and the subsequent rise in risky assets. In 2019, the top 20 managers made about a third of the overall earnings in the industry.
“Managers capable of differentiating between winners and losers in the sector have made spectacular gains [in 2020]”Said Rick Sopher, chairman of the LCH board, adding that human traders generally outperformed computer-oriented strategies.
The optimistic performance of some hedge funds comes after years of often modest returns. Ken Heinz, president of the HFR data group, said that last year “should be one of the best, if not the best year for the industry”.
Coleman’s Tiger Global, based in New York, a so-called Tiger cub created by managers who left Julian Robertson’s Tiger Management, entered the ranking of the 20 biggest money earners of all time, in 14th place. It made $ 10.4 billion in profits after betting on rising stock prices, according to LCH, the biggest gain among the top 20.
The top 20 downfall was Jim Simons’ Renaissance, after his Institutional Diversified Alpha fund lost 32 percent and its institutional stock fund lost 20 percent, according to figures sent to investors, one of several money-losing funds. .
Ray Dalio’s Bridgewater also suffered, losing $ 12.1 billion to investors last year after being hit by the market’s wave of sales. Dalio told the Financial Times last March that “we remain in our positions and, in retrospect, we should have cut all risks”. Its Pure Alpha fund, which seeks to profit from macroeconomic trends, lost 7.6% last year, although its All-Weather funds gained 9.5%. Despite his losses last year, Bridgewater remains at the top of the list of managers of all time from the start, with $ 46.5 billion in profits.
Among other funds for profit was Englander’s Millennium, which manages $ 46.7 billion in assets and earned $ 10.2 billion last year, according to LCH. The fund, which limited losses during the spring market turmoil, made about 25% last year, including big gains in December, according to figures sent to investors. These gains helped to elevate him to seventh place on the list of gains from the beginning, compared to the 12th year last.
Ken Griffin’s Citadel, which manages $ 30 billion in assets, had a 24.4% return on its Wellington fund, said a person who saw the numbers, and $ 6.2 billion in earnings last year, according to the LCH. Steve Mandel’s Lone Pine won $ 9.1 billion, taking him from fourth place on the all-time list to third place.