While there are some big investors that prefer to keep to themselves, rarely appear in the media and only issue some comments in letters to investors that sometimes appear in the press, there are others that do the exact opposite. One of the latter group is Cliff Asness, a billionaire investor who founded AQR Capital Management, one of the most successful quant funds. Asness often appears on CNBC, Bloomberg TV and other channels where he discusses financial issues and sometimes politics. In addition, Asness has written many papers and articles, which are available on AQR’s website.
Clifford S. Asness was born in Queens, New York on October 17, 1966. He studied at the University of Pennsylvania, where he obtained BS degrees in English and Economics and went to the University of Chicago, where he obtained an MBA at the Chicago Booth School of Business and completed the finance PhD program. After getting his PhD, Asness got a job as managing director and director of quantitative research for Goldman Sachs Asset Management. While at Goldman, he founded the Goldman Sachs Global Alpha Fund, a systematic hedge fund, which was one of the first quantitative funds in the industry. In 1997, he left Goldman Sachs to found AQR Capital Management. Two years later, Asness married Laurel Elizabeth Fraser, who had been working at Goldman Sachs, and they have four children. Asness has a net worth of around $3.0 billion, according to Forbes.
As stated earlier, Asness has written and contributed to a variety of papers some of which were published in peer-reviewed journals, such as the Journal of Finance and Journal of Portfolio Management, and there are many publications authored by him available on AQR’s website. For example, in 2013, Asness, together with Tobias J. Moskowitz, and Lasse Heje Pedersen, wrote a paper titled “Value and Momentum Everywhere” that was published in the Journal of Finance. His earlier papers include “Do Hedge Funds Hedge? Be cautious in analyzing monthly returns.” published in the Journal of Portfolio Management in 2001, and “Surprise! Higher Dividend = Higher Earnings Growth” that was published in 2003 in the Financial Analysts Journal.
Asness’ papers received a number of awards. Financial Analysts Journal twice awarded the investor the Graham and Dodd Award for the year’s best paper, as well as a Graham and Dodd Excellence Award for the best perspective piece and the Graham and Dodd Readers’ Choice Award. In 2006, Asness also received the James R. Vertin Award from the CFA Institute. In addition to awards for his research work, Asness was also included in the list of the 50 Most-Influential People in Global Finance by Bloomberg Markets.
Asness founded AQR Capital Management in 1998 together with David Kabiller, John M. Liew, and Robert Krail. Asness, Kabiller and Liew are currently the Founding Principals of the fund, while Krail has retired for health reasons. The fund employs over 800 people in offices in Boston, Chicago, Los Angeles, London, Hong Kong, and Sydney.
AQR is a quantitative hedge fund with over $195 billion in Assets Under Management, which employs a systematic approach to portfolio building and is a proponent of diversification, using multiple dimensions like asset classes, strategies and time in order to minimize risk and achieve consistent returns.
Cliff Asness is an investor worth following and not just for academic insights, but also because his stock picks can help generate market beating returns. At Insider Monkey, we analyze AQR’s quarterly 13F filings alongside other investors and select some of the stocks that they are collectively bullish on as part of our investment strategy (see more details). At the same time, we looked through the performance of AQR’s holdings in companies worth over $1.0 billion. According to our calculations, AQR was 9.4% in the green in the first six months of 2016, while over the 12-month period ended June 30, the fund’s positions returned over 25%.
In its latest 13F filing, AQR disclosed an equity portfolio worth nearly $75.6 billion, which contained over 2,300 positions, spread across most sectors. On the next pages, we are going to discuss some of the companies in which AQR amassed the largest stakes heading into the third quarter.