They are also known as investment managers. These are the people in charge of implementing the investment strategy and managing the portfolio trading activities of a fund. They have a high level of professional credentials and they are paid a percentage of the fund’s average assets. These are the 10 highest paid fund managers in the world, along with their earnings this past year.
10. Daniel Loeb – $425 million
Daniel Loeb is the founder and chairman of Third Point. The company’s small leverage fund was considered as one of the best performing hedge funds of 2012. Its prime hedge fund earned a highly respectable 21.2 percent net return, beating the numbers of the stock market. He is currently managing a total of $10 billion. He made money betting on the sovereign debt of Greece. He then effected a leadership change in Yahoo, putting Marissa Mayer as the CEO in lieu of Scott Thompson. He has also taken a position in Herbalife even after other fund managers called the company a pyramid scam.
9. Leon Cooperman – $470 million
Leon Cooperman is the founder and owner of Omega Advisors. The native New Yorker started out as a quality control engineer with Xerox in 1965. He then got his MBA from Columbia University before joining Goldman Sachs. He then went on to become the head of its asset management group. He decided to leave in 1991 to form Omega. Last year, the company managed $6.6 billion and earned 25 percent.
8. David Shaw – $625 million
David Shaw is the man behind D.E. Shaw & Co., LP. A PhD holder from Stanford, Shaw still directs decisions of the company regarding the fund even though he is not involved with the company’s daily operations anymore. He is currently an adjunct professor of biomedical informatics at the medical school of Columbia University. Last year, the company’s flagship fund earned 18 percent, while a smaller hedge fund it manages got a 15.6 percent return.
7. Ray Dalio – $800 million
Ray Dalio is the founder of Bridgewater Associates, a fund management company he established in New York in 1975. The company is currently the biggest hedge fund company in the world, managing tens of billions of dollars in assets. Though his hedge fund did not perform as well as expected, the company is still well respected in the financial community. Dalio has been slowly delegating a lot of his responsibilities to his subordinates as he has been focusing on completing a new headquarter in Stamford in Connecticut for $750 million.
6. Ken Griffin – $900 million
Ken Griffin is the founder and owner of Citadel LLC. The company had endured some tough losses as recent as 2008. It still managed to retain $14 billion in asset management, however, and it bounced back by 2011 with a net return of more than 20 percent. Last year, the fund managed even better numbers with a 25 percent yield. Aside from hedge funds, Citadel also has a securities business that accounts for 14 percent of the consolidated equity volume in the United States.
5. George Soros – $1.1 billion
George Soros is the founder of Soros Fund Management LLC. The company manages $24 billion, mostly from his personal wealth and the money of his various foundations. Considered as a legend in the financial industry. Soros has relinquished daily operations of his company to Scott Bessent, though he still remains heavily involved despite already being 82 years old. His fund did not do as well in 2012 when compared with the stock market, but it still managed to yield out positive numbers.
4. James Simons – $1.3 billion
James Simons is the founder of Renaissance Technologies, a $20 billion hedge fund firm. He graduated from the Massachusetts Institute of Technology and became a theoretical mathematician and code breaker for the Department of Defense during the Vietnam War. He then headed the math department of SUNY-Stony Brook. He established Renaissance in 1982 in New York, using computer modeling to find flaws in highly liquid securities. A couple of the company’s funds lost money last year, however. At 74 years old, Simons is still active in devising strategies for the hedge funds.
3. Steven Cohen – $1.3 billion
Steven Cohen is the founder of SAC Capital Advisors. He has recently gotten into controversy because of allegations of insider trading. Still, the company was trusted with $14 billion in assets to manage. Last year, the company’s hedge fund earned 25 percent, but its high charges meant that the final return amounted to only 13 percent. Even at that rate however, the hedge fund still performed much better than a lot of its competitors.
2. Carl Icahn – $1.9 billion
Carl Icahn is the founder of Icahn Capital. Though he is already 77 years old, he has retained a magic touch in handling hedge funds. His asset pool earned a yield of 28 percent in 2012, far outstripping the numbers posted by the stock market and other hedge fund managers. The fund includes his personal money and that of his employees, and it benefitted tremendously from Icahn’s successful bet on the stocks of companies like the Hain Celestial Group and CVR Energy.
1. David Tepper – $2.2 billion
David Tepper can be considered as the greatest hedge fund manager of all time. He is the man behind Appaloosa Management, a $15 billion hedge fund company that has been averaging returns of 30 percent every year since 1993. The past year saw the same number, and that rate is even more impressive considering that most hedge funds had underperformed when compared with the actual yield of the stock market. Timing has always proven to be the key for Tepper, as he always manages to invest and bet on stocks and securities at key moments. To further endear his company to clients, Appaloosa Management actually gave back some money to its investors at the end of the year.
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