Who are the best hedge fund managers of 2011? It usually isn’t easy to define what best is. It isn’t very difficult when it comes to hedge funds. The amount of money a hedge fund manager makes in a year is a pretty good proxy about the quality of that hedge fund manager. Hedge fund managers with the best reputation usually manage large amounts of money. They also made a ton of money in the past and invest their wealth in their funds. If these fund managers perform well in a given year, they will make billions. Here are the 40 highest earning hedge fund managers:
1. Ray Dalio: $3 billion
2. Jim Simons: $2.1 billion. Why is this so little? Anything below $3 billion is a failure for Jim Simons. Do other high frequency funds cut into Medallion’s returns? We know that RIEF made more than 34% in 2011.
3. Carl Icahn: $2 billion
4. Steve Cohen: $600 million
5. David E. Shaw: $580 million
6. Chase Coleman: $500 million. Forbes reports that Chase Coleman returned 45% in 2011.
7. Ken Griffin: $400 million
8. Alan Howard: $400 million
9. John Arnold: $360 million. This doesn’t make sense though. John Arnold manages only $3.5 billion and returned 9% in 2011. This means his performance fees are $70 million and management fees are $50 million. Assuming his trading and all other expenses are around 1% of his AUM, his net income is $85 million. Where did the remaining $275 million come from? Forbes says he had $1.75 billion of his own capital in the fund. However, the net return of this money is only $160 million. Something is missing here.
10. Bruce Kovner: $210 million
11. Andreas Halvorsen: $200 million. Forbes misspelled his name.
12. Paul Tudor Jones: $200 million
13. Israel Englander: $190 million. This doesn’t make sense either. Englander manages almost $15 billion and he returned about 8.5% in 2011. He is also a billionaire. How is it possible that he made almost half of what John Arnold made? Arnold’s return is similar to Englander’s return but Arnold manages $11 billion less.
14. Daniel S. Och: $170 million
15. David Harding: $150 million. Winton Capital returned 6.3% in 2011.
16. Peter Brown – Renaissance Technologies: $125 million
17. Seth Klarman: $125 million. Klarman manages $24 billion, yet he only made 0.5% of his AUM. I am sure there are some mutual fund managers that made more in 2011.
18. Robert Mercer – Renaissance Technologies: $125 million
19. Michael Platt: $125 million
20. Nelson Peltz: $110 million. Trian Partners returned 7.02% net of fees in 2011.
21. Daniel Gold: $100 million. I had no idea QVT Financial manages $5 billion. We should take a closer look at their holdings.
22. Hari Hariharan: $100 million. NWI Management had a $76 million China ETF and a $42 million emerging markets ETF position in his 13F portfolio. He also bet $1.3 million on silver. That’s it. He clearly invests his money abroad. Who knew emerging markets were this profitable in 2011!
23. Yan Huo – Capula Investment Management: $100 million
24. Russell Jeffrey – Providence Investment Management: $100 million
25. Philippe Laffont: $100 million. Coatue Management returned 11.55% in 2011.
26. Colm O’Shea – Comac Capital: $100 million. O’Shea previously worked for George Soros and he made more money in 2011 than Soros. Amazing! Soros should have tried to make billions by betting against Europe instead of trying to save them. He could have improved his reputation to “The Man Who Broke European Central Bank”
27. Paul Singer: $100 million
28. Boaz Weinstein: $90 million. Saba Capital has more than $5 billion AUM and returned 9% in 2011. Weinstein used to work for Deutsche Bank and now he makes more than Deutsche Bank’s CEO. No wonder why investment banks drove the World economy into a ditch. Their smartest employees leave to launch their hedge funds, what they are left with are unskilled people who wouldn’t mind betting on beta to make a fraction of what Weinstein makes.
29. Jaffray Woodriff: $90 million
30. David Einhorn: $80 million. Greenlight Capital has around $8 billion in AUM, and returned 2.3% in 2011. Yet, Einhorn made about 1% of his AUM. How come Seth Klarman made only 0.5% of his AUM?
31. Greg Jensen – Bridgewater Associates: $70 million
32. Robert Prince – Bridgewater Associates: $70 million
33. Anthony Todd – Aspect Capital: $70 million
34. Albert Freidberg – Freidberg Mercantile Group: $60 million
35. Leda Braga – BlueCrest Capital Management: $50 million
36. John Thaler: $50 million. JAT Capital manages $2.6 billion and returned 17.2% in 2011. These numbers don’t make sense either. John Thaler’s performance fee is about 4% of his AUM. Assuming he made net 1% from management fees, his total would be around $130 million. What is missing here?
37. Donald Brownstein: $40 million
38. Robert Citrone: $40 million. Discovery Capital has $5.2 billion AUM at the end of 2011 and returned 3.53% in 2011.
39. Danny Yong -Dymon Asia Capital: $40 million.
40. Joe Zhou – Ortus Capital Management: $40 million