- Insider complied a list of 11 managers to know as the new year approaches.
- The list includes big-name managers, new launches, and under-the-radar funds.
- 2021 was a stressful year for hedge funds thanks to retail traders and Covid variants.
The year 2021 was not a quiet one for hedge funds.
Retail traders coordinated short squeezes. Variants spooked markets. Capital in private companies set new record, and SPACs attracted everyone from Bill Ackman to Shaq.
In the end, managers — for the most part — made it out ok. The average fund was up just under 9% through the first 11 months of 2021 after a nasty November, which tripped up managers like Tiger Global and Whale Rock. This figure trails the S&P 500, but is still close to matching last year’s strong industry-wide performance with a whole month to go.
There are plenty of funds though that soared or sunk this year for a variety of reasons. From big-name managers to under-the-radar stars to new launches, Insider talked with industry experts to get a sense of which funds to keep a close eye on next year.
1. Perceptive Advisors
Perceptive Advisors
Biotech was slammed this year, and the most prominent hedge fund in the space was not spared any pain. Billionaire Joseph Edelman’s Perceptive Advisors has lost more than 30% in its flagship Life Sciences fund through the end of November, as previously reported by the Wall Street Journal. Perceptive though has a way of bouncing back quickly. Following a drop of 8% in 2018, the firm’s flagship returned more than 50% in 2019. With the firm’s many different arms — including venture capital funds and several SPACs — Perceptive is unlikely to be down for long.
2. Elliott Management
REUTERS/Steve Marcus
Fresh off its exciting Twitter campaign that culminated in a tech billionaire stepping down, Elliott Management is not resting. The $48 billion activist fund is pushing a pair of UK companies — drugmaker GlaxoSmithKline and energy firm SSE — to accelerate their growth plans, and potentially spin off units. In the states, the firm’s private-equity arm, Evergreen Coast Capital, is going big on education technology and scored a big win this year when it sold athenahealth for $17 billion.
3. Mala Gaonkar’s new fund
Adam Jeffrey/Getty Images
One of the industry’s most interesting characters is hanging out her own shingle. Mala Gaonkar, the long-time Lone Pine executive and portfolio manager, left the Greenwich-based Tiger Cub to start her own fund earlier this year. Gaonkar, who focused on technology, media, telecomm, and emerging markets companies, will be one of the several female hedge-fund founders who is planning to launch next year (though she’ll be the only one who has created art exhibitions with Talking Heads frontman David Byrne).
4. Gemsstock Limited
Vladimir Smirnov\TASS via Getty Images
Founded in 2014, London-based Gemsstock is not yet a brand name in the macro space, but should be on LPs’ radar going into the new year. After posting gains above 50% last year, the fund has returned close to 16% through October of this year, according to HSBC’s Hedge Weekly. Cofounder Al Breach was known as a star Russia strategist when he was at UBS, which could be a critical background to have as Russian president Vladimir Putin threatens Ukraine and US President Joe Biden counters with strong rhetoric.
5. ExodusPoint
Gary Hershorn/Getty Images
The biggest hedge fund launch ever has not had any trouble attracting portfolio managers or raising capital, but the performance has yet to match that of its main multi-strategy rivals. ExodusPoint, according to a stat sheet sent out in early December, has returned a little over 3% for the year through November, trailing the industry average (though the manager was positive in a tough November). The firm’s hiring has continued apace, as new portfolio managers are added every month in different regions around the world, though the firm did lose two top technology and data executives earlier this year.
6. Melvin Capital
House Committee on Financial Services/Handout via Reuters
The biggest story in hedge funds this year happened in 2021’s first month. Gabe Plotkin — who had ridden years of top-notch returns to a sterling industry reputation and a minority stake in the NBA’s Charlotte Hornets — was caught off guard by a horde of retail traders banding together prop up the price of video-game retailer GameStop’s stock, which Plotkin’s Melvin Capital had bet against. The result was billions of dollars lost for Plotkin’s investors in a matter of days, and massive investments from Citadel founder Ken Griffin and Plotkin’s old boss, Steve Cohen. He has spent the year chipping away at the hole, and is up nearly 29% from the start of February through the end of November, according to a source familiar with the firm. Unfortunately, that still puts his losses for the year at 41% through November. How he bounces back next year will be of great interest for LPs and the retail investing community.
7. Coast Capital
Coast Capital
A run of strong performance — 21% in 2019, 58% last year, 28% this year — has small activist fund Coast Capital on the radar of industry watchers. The $350 million manager, run by former Jana managing director James Rasteh, has focused recently on European opportunities, including UK transportation company FirstGroup and British software company BluePrism, which the fund believes should relist in the US to drive its valuation up closer to its American peers.
8. Braidwell
Andrew Toth/Getty Images
Alex Karnal’s buzzed-about healthcare manager has yet to launch, but industry watchers are still excited for the former Deerfield managing director’s new firm. Karnal, who played quarterback for MIT, is planning for the fund to be a hybrid offering, with investments in public and private securities. He brought on Brian Kreiter, a former executive at Bridgewater Associates, to lead the fund.
9. Anson Funds
Wikimedia
Anson Funds, run by Moez Kassam, has had two years of top-tier performance back-to-back. The manager, which has offices in Toronto and Texas, was up 45% last year, and finished the third quarter of 2021 up over 40%. However, things are not perfect at the equity manager. The firm was named by Bloomberg as a manager that the Department of Justice is looking into as a part of wider short-selling probe. Other managers named in the Bloomberg report include prominent short-sellers Muddy Waters Capital and Andrew Left’s Citron Research.
10. Maverick
Drew Angerer/Getty Images
Billionaire Lee Ainslie’s long-running Tiger Cub has fared just fine this year, despite losing its top stock-picker Andrew Warford in February. The firm has bested the average fund this year in its flagship offering and was up over 15% through November. And like peers such as Viking Global, Lone Pine, and Tiger Global, Maverick’s private investment book has been growing under David Singer. According to the Maverick Ventures site, the firm has more than 53 private companies in its portfolio, including Artemis Health and mortgage start-up Snapdocs.
11. Greenland Capital
Phil McCarten/Reuters
The resources and capital needed to start a new multi-strategy fund from scratch are serious, but it’s a good bit easier when you’ve got a serious backer who shares your last name. Michael Englander, son of billionaire Millennium founder Izzy Englander, is starting his own multi-strategy fund, Greenland Capital, with at least $300 million in capital from a group that includes his father. The firm will initially raise more than $1 billion and give young investors a chance to manage a portfolio, building off the younger Englander’s work running Millennium’s Phenom program, which developed promising young talent at the massive hedge fund.
Rankings by Total Managed AUM
| Rank | Profile | Managed AUM |
|---|---|---|
| 1. | Bridgewater Associates, LP | $235,542,378,467 |
| 2. | Balyasny Asset Management | $180,959,433,560 |
| 3. | Tiger Global Management LLC | $124,655,466,641 |
| 4. | Garda Capital Partners | $124,164,445,000 |
Which hedge fund is best? ›
Bridgewater Associates
Bridgewater is the world’s largest hedge fund, with about $150 billion in capital. Since its founding in 1975, Bridgewater has returned $52.2 billion in gains to its investors – more than any other hedge fund on the planet.
What is the highest position in a hedge fund? ›
Depending on the size of the hedge fund company, the portfolio manager might be the person at the top or one of several. Their job is to create the overall strategy for their assets under management (the money invested in the fund).
How much do the best hedge fund managers make? ›
Hedge fund managers make $135,399 per year on average, or $65.1 per hour, in the United States. Hedge fund managers on the lower end of that spectrum, the bottom 10% to be exact, make roughly $70,000 a year, while the top 10% makes $261,000. Location impacts how much a hedge fund manager can expect to make.
Who is the most successful fund manager? ›
Great money managers are the rock stars of the financial world. While Warren Buffett is a household name to many, to stock geeks, the names of Benjamin Graham, John Templeton, and Peter Lynch are cause for extended discourses on investment philosophies and performance.
Who is the best portfolio manager? ›
Rankings by Total Managed AUM
| Rank | Profile | Managed AUM |
|---|---|---|
| 1. | Vanguard | $8,500,000,000,000 |
| 2. | BlackRock | $8,487,410,000,000 |
| 3. | State Street Corporation | $4,022,000,000,000 |
| 4. | Fidelity Management & Research | $3,688,587,311,060 |
Will hedge funds exist in 10 years? ›
Overall, the consensus is that hedge funds will continue to grow but will adapt to lower fees, greater use of technology, and increased access to retail investors.
What is the largest hedge fund in the US? ›
The largest hedge fund in the U.S. is BlackRock, with a revenue of $19.374 billion. As of 2022, the U.S. hedge funds have a market size of $111.3 billion. There are at least 3,841 Hedge Funds in the U.S.
Whats a good hedge fund return? ›
Average gains of +4.00% lifted YTD average returns to +11.02%, past the level in 2019 (+10.07%) and to the highest level since 2009 (+19.44%). While average returns in 2020 were elevated, there have been several years of similar returns since 2009 (+10% in 2019, +9% in 2017, +10% in 2013 and +11% in 2010).
What type of people work at hedge funds? ›
Hedge funds employ analysts, researchers, traders, portfolio managers and other financial professionals. These people work together to choose stocks to invest in and short.
How much does a partner at a hedge fund make? ›
As of Sep 20, 2022, the average annual pay for a Hedge Fund Partner in the United States is $141,942 a year.
How much does a hedge fund trader make? ›
Hedge Fund Traders in America make an average salary of $117,549 per year or $57 per hour. The top 10 percent makes over $201,000 per year, while the bottom 10 percent under $68,000 per year.
Who is the richest portfolio manager? ›
Jim Simons is back on top. For the fifth time in seven years, the 83-year-old founder of quant specialist Renaissance Technologies leads Institutional Investor’s Rich List, the definitive ranking of the highest-earning hedge fund managers.
How much are bonuses at hedge funds? ›
Bonuses, which are cash and other financial incentives commonly provided to finance professionals, are part of the culture at hedge funds. The typical bonus size is between 15 percent and 25 percent of the profits a hedge fund manager is responsible for producing at the firm.
How do you trade like a hedge fund manager? ›
We’ve listed some of them below.
- Using derivatives. Hedge funds often take advantage of financial derivative contracts such as options, forwards and futures. …
- Long-short trading strategy. …
- Create a portfolio of trades. …
- Don’t overleverage your trades. …
- Perform your analysis. …
- Manage your exit points.
Who is the best investor of all time? ›
Warren Buffett is widely regarded as the most successful investor in the world based on the amount of capital he started with and what he was able to grow it into.
Which mutual funds are best for next 5 years? ›
Best SIP Plans for 5 And 3 Years in Equity Funds and Debt Funds
| Fund Name | 5 years Return | 3 years Return |
|---|---|---|
| DSP Equity Fund | 14.36% | 14.69% |
| ICICI Prudential Technology Fund | 33.91% | 41.39% |
| HDFC Balance Advantage Fund | 15.50% | 16.60% |
| ICICI Prudential Bluechip Fund | 10.81% | 8.48% |
What is the best fund management company? ›
World’s Top Asset Management Firms
| Rank | Company | Country |
|---|---|---|
| 1 | BlackRock | US |
| 2 | Vanguard Group | US |
| 3 | UBS Group * | Switzerland |
| 4 | Fidelity Investments | US |
What is the best stock watcher? ›
Your best choice is likely one of the following:
- Best stock tracking app for Windows and Mac: Stock Rover.
- Best website to view stocks: Webull.
- Best for sophisticated investors: TradeStation.
- Best stock tracking app for Android: M1 Finance.
- Best stock tracking app for iPhone: SoFi: (iOS), Android, Desktop.
What are the 3 types of portfolio? ›
For example, Danielson and Abrutyn (1997) identify three major types of portfolios: working portfolios, display portfolios, and assessment portfolios.
How many fund managers beat the market? ›
On average, roughly 35% of managers have outpaced the S&P 500 in any calendar year, based on annual results back to 2007.
What is the average lifespan of a hedge fund? ›
According to the Financial Times, most hedge funds fail, with the average lifespan sitting at about five years.
How much money do you need to invest in a hedge fund? ›
It is not uncommon for a hedge fund to require at least $100,000 or even as much as $1 million to participate. Unlike mutual funds, hedge funds avoid many of the regulations and requirements within the Securities Act of 1933.
Can I start a hedge fund with my own money? ›
Yes, you could start with much less capital, or go through a hedge fund incubator, or use a “friends and family” approach, or target only high-net-worth individuals. But if you start with, say, $5 million, you will not have enough to pay yourself anything, hire others, or even cover administrative costs.
Who is the biggest hedge fund in the world? ›
1. BlackRock Advisors. BlackRock (BLK) is a New York-based investment manager that manages trillions in assets. The largest BlackRock entity, BlackRock Fund Advisors, has been in operation since 1984 and oversees $1.9 trillion in assets.
Who is the largest money manager in the world? ›
What is the biggest fund in the world? ›
1. Government Pension Fund Global—Norway. Even though its name has the word pension fund, Norway’s sovereign wealth fund
A sovereign wealth fund is a state-owned investment fund comprised of money generated by the government, often derived from a country’s surplus reserves. SWFs provide a benefit for a country’s economy and its citizens. The funding for a SWF can come from a variety of sources. https://www.investopedia.com › terms › sovereign_wealth_fund is the largest in the world and with over $1 trillion in assets it is growing fast.
What is the average annual return of a hedge fund? ›
According to BarclayHedge, the average hedge fund generated net annualized returns of 7.2% with a Sharpe ratio of 0.86 and market correlation of 0.9 over the last five years through 2021.
What’s the average hedge fund return? ›
Hedge funds with commodities-focused strategies delivered 12.09 percent average returns, and event-driven funds reported an average return of 9.16 percent for the quarter, according to Citco.
What percentage do hedge fund managers take? ›
The 2% management fee is paid to hedge fund managers regardless of the fund’s performance. A hedge fund manager with $1 billion AUM earns $20 million in management fees annually even if the fund performs poorly.
How much money can you make working at a hedge fund? ›
Hedge Fund Salary Guide in the US for 2018
| Job Title | Base Salary |
|---|---|
| Hedge Fund Accountant (1 to 3 Years) | $48,000 |
| Hedge Fund Accountant (3 to 5 Years) | $62,250 |
| Hedge Fund Accountant – Manager | $75,000 |
| Intern/Summer Analyst | $76,000 |
Is it stressful working at a hedge fund? ›
Working at a hedge fund is stressful. You have billions of dollars at risk. Every day, something unexpected pops up. It’s stressful trying to figure out why you’re losing millions on a stock, when there’s no news.
Do you need a degree to work at a hedge fund? ›
Hedge fund managers typically have a minimum of a bachelor’s degree, although many companies prefer a master’s degree. Hedge fund managers may have a degree in accounting, finance, economics or business administration.
What are hours like at a hedge fund? ›
At smaller, single-manager funds, the average might be 10-12 hours per day, for a total of 50-60 hours per week (weekend work is rare). As you move to larger, multi-manager funds, the hours and stress get worse, so the average may be more like 60-70 hours per week.
How much does a PM at Citadel make? ›
Citadel Salary FAQs
How does the salary as a Project Manager at Citadel compare with the base salary range for this job? The average salary for a Project Manager is $79,107 per year in United States, which is 44% lower than the average Citadel salary of $141,297 per year for this job.
How long does it take to become a partner at a hedge fund? ›
Making partner requires more than a decade on average at funds of funds (12 years), mezzanine firms (12.7 years), institutional investors (12.8 years) and corporate VC firms/secondary funds/co-investment funds (13 years). For more on the Compensation Report, click here.
How much does a good trader make? ›
According to Indeed Salaries, the average base salary for a stock trader in the U.S. is $80,086 per year . They can also expect to make an average commission of around $25,000 per year.
How much do day traders make per month? ›
| Annual Salary | Monthly Pay | |
|---|---|---|
| Top Earners | $125,500 | $10,458 |
| 75th Percentile | $95,500 | $7,958 |
| Average | $75,956 | $6,329 |
| 25th Percentile | $33,500 | $2,791 |
How much does a COO of a hedge fund make? ›
How Much Do Chief Operating Officer Hedge Fund Jobs Pay per Year? $80,000 is the 25th percentile. Salaries below this are outliers. $144,000 is the 75th percentile.
Do you pay taxes on hedge fund gains? ›
Hedge funds typically do not pay taxes at the entity level on their income and gains. Instead, each investor in a hedge fund must typically report his allocable share of the fund’s income, gains, losses, deductions and credits on his own tax return.
Who is the richest person on Wall Street? ›
Here are six of Wall Street’s top earners and the hedge funds they manage….
Buffett is by far the richest person of these six famous investors, with a net worth of $116 billion.
- John Paulson. Unlike most people, John Paulson benefited from the mortgage crisis. …
- Warren Buffett. …
- James Simons. …
- Ray Dalio. …
- Carl Icahn. …
- Daniel Loeb.
How many hours do hedge fund managers work? ›
At hedge funds, meanwhile, the ‘reasonable’ working week is around 70 hours. Around 80% of people working in hedge funds work between 50 and 70 hours a week, according to a recent report from consultants Benchmark Compensation.
How many employees does a hedge fund need? ›
Many firms have fewer than five employees, and even the largest firms typically have only between 200 and 1,000 employees. Bridgewater Associates, for example, has the most assets under management of any hedge fund, but it only employs 1,500 people.
How much does a senior analyst at a hedge fund make? ›
Hedge fund analyst: $150K-$200K, with bonuses typically bringing the salary above $500K in a good year. Senior analyst: $1 million approximately, with most of this being the bonus. Risk manager: $500K, with some of this being bonus, but most of it being base salary.
How much does a CFO of a hedge fund make? ›
What Is the Salary of a Hedge Fund CFO? According to ZipRecruiter, the average salary of a Hedge Fund CFO is $120,303.
Do hedge funds buy or sell options? ›
A fund manager would typically sell options on the index and buy options on the individual stocks composing the index. If maximum dispersion occurs, the options on the individual stocks make money, while the short index option loses only a small amount of money.
How do I make my hedge fund successful? ›
Tips for Hedge Fund Startups
- What’s Your Competitive Advantage? Your hedge fund must have a competitive advantage over others in the market. …
- Define Your Strategy. …
- Find the Seed Capital. …
- Develop a Marketing and Sales Plan. …
- Consider Risk Management. …
- Get a Great Lawyer. …
- Decide on a Prime Brokerage. …
- Build Out Your Technology.
Do hedge funds do Daytrade? ›
Many hedge funds use day trading to diversify their portfolio or supplement their gains – though the day trading model may not fit in with the strategies of many funds. Other trading strategies employed by hedge funds include: short-selling. long-short, long-only and short-only.
Who is the wealthiest hedge fund manager? ›
Citadel’s Ken Griffin jumped to 1st place on the list after coming in 5th last year, according to financial data compiled by Bloomberg. He hauled in $2 billion in 2021 — up from $1.8 billion in 2020. Thanks to another record year at Citadel, his net worth is now approximately $28 billion.
Is Warren Buffett a hedge fund manager? ›
June 1, 2021 – In their younger years, Berkshire Hathaway’s Warren Buffett and Charlie Munger were both aggressive hedge fund managers, with each running an investment partnership on behalf of wealthy clients.
Who is the biggest hedge fund in the world? ›
1. BlackRock Advisors. BlackRock (BLK) is a New York-based investment manager that manages trillions in assets. The largest BlackRock entity, BlackRock Fund Advisors, has been in operation since 1984 and oversees $1.9 trillion in assets.
Who is the biggest asset manager in the world? ›
Do you pay taxes on hedge fund gains? ›
Hedge funds typically do not pay taxes at the entity level on their income and gains. Instead, each investor in a hedge fund must typically report his allocable share of the fund’s income, gains, losses, deductions and credits on his own tax return.
Who is the richest portfolio manager? ›
Jim Simons is back on top. For the fifth time in seven years, the 83-year-old founder of quant specialist Renaissance Technologies leads Institutional Investor’s Rich List, the definitive ranking of the highest-earning hedge fund managers.
What is a hedge fund manager salary? ›
The salaries of Hedge Fund Managers in the US range from $20,239 to $541,382 , with a median salary of $97,845 . The middle 57% of Hedge Fund Managers makes between $97,852 and $245,495, with the top 86% making $541,382.
Who won the Warren Buffett bet? ›
In 2008, Warren Buffett issued a challenge to the hedge fund industry, which in his view charged exorbitant fees that the funds’ performances couldn’t justify. Protégé Partners LLC accepted, and the two parties placed a million-dollar bet. Buffett has won the bet, Ted Seides wrote in a Bloomberg op-ed in May.
What is Warren Buffett’s golden rule? ›
“Rule Number One: Never Lose Money. Rule Number Two: Never Forget Rule Number One” Buffett personally lost about $23 billion in the financial crisis of 2008, and his company, Berkshire Hathaway, lost its revered AAA rating.
Can hedge funds beat the market? ›
Charted: Hedge funds still can’t match the S&P 500
2021 wasn’t the year for hedge funds to finally outperform passive investing. The big picture: Some hedge funds are sure to beat the index in any given year. But average hedge fund returns continued to lag — in a big way, according to data provided by eVestment.
Who is the largest hedge fund in the US? ›
The largest hedge fund in the U.S. is BlackRock, with a revenue of $19.374 billion. As of 2022, the U.S. hedge funds have a market size of $111.3 billion. There are at least 3,841 Hedge Funds in the U.S. U.S. hedge funds have experienced a CAGR of 8% in 2022.
What is the biggest fund in the world? ›
1. Government Pension Fund Global—Norway. Even though its name has the word pension fund, Norway’s sovereign wealth fund
A sovereign wealth fund is a state-owned investment fund comprised of money generated by the government, often derived from a country’s surplus reserves. SWFs provide a benefit for a country’s economy and its citizens. The funding for a SWF can come from a variety of sources. https://www.investopedia.com › terms › sovereign_wealth_fund is the largest in the world and with over $1 trillion in assets it is growing fast.
How much money do you need to invest in a hedge fund? ›
It is not uncommon for a hedge fund to require at least $100,000 or even as much as $1 million to participate. Unlike mutual funds, hedge funds avoid many of the regulations and requirements within the Securities Act of 1933.
Who are the big 3 asset managers? ›
Crucially, this large and growing industry is dominated by just three asset management firms: BlackRock, Vanguard, and State Street. In recent years they acquired significant shareholdings in thousands of publicly listed corporations both in the United States and internationally.
What is the best investment company in the world? ›
Top 10 Largest Investment Companies in World 2022
| Rank | Company | Country |
|---|---|---|
| 1 | BlackRock | USA |
| 2 | The Vanguard Group | USA |
| 3 | Charles Schwab Corporation | USA |
| 4 | UBS Group | Switzerland |
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