There’s a reason they’re called Masters of the Universe.
The 25 top hedge fund managers took home a sweet $11.6 billion last year, even in a time of tightening credit and falling stock prices which shuttered many less-nimble funds.
Of course, the price of admission to the club was sharply lower: To make the cut, a hedge fund hotshot needed to earn $75 million, down from the $360 million required for 2007’s top 25, according to Alpha Magazine’s annual rankings.
The top spot for 2008 went to James Simons, 70, the former math professor who pioneered the use of computational models for investing at hedge fund, Renaissance Technologies, and who earned $2.5 billion in 2008.
John Paulson, whose gains grew out of his predicting the collapse of the subprime mortgage market, was No. 2, with earnings of $2 billion - down from $3.7 billion the year before.
John D. Arnold, a former Enron energy trader in his 30’s, was No. 3, bringing home $1.5 billion. Arnold, who was the only newcomer to this year’s list, founded the Houston-based Centaurus Energy Advisors in 2002, and apparently made a fortune trading on natural gas prices.
Liberal philanthropist George Soros, 78, the founder of Soros Fund Management, slipped to No. 4 from his prior No.2 ranking, earning $1.1 billion, which was down two-thirds from 2007. Soros, who had predicted the global financial crisis, came out of retirement in 2007 to find ways to gird for it.
“It is, in a way, the culminating point of my life’s work,” he told The Australian.
While humility is not usually associated with hedge fund stars, at least one of the top earners expressed both gratitude and paranoia, at a time when when hedge funds are likely to come under new regulatory oversight.
John R. Taylor, chairman and CEO of FX Concepts, who tied for ninth place, acknowledged Uncle Sam’s role in his success.
“Thank God for the government,” Taylor told the New York Times. “Because if they hadn’t intervened, we wouldn’t have had anybody to trade with.”
Still, Taylor complained that Alpha had overstated his earnings by a factor of five, and he was not happy to be identified as a hedge fund titan.
“This is bad luck with the trading gods,” he said. “We’re doomed next year if you write about us.”
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2 Comments
#1. Brian Barker 03.29.2009
Did you know that George Soros would not be a multi-billionaire if it were not for the international language Esperanto?
Born in Hungary in 1930 as Gyorgy Schwartz, the family changed its name in 1936 to Soros, which in Esperanto means “to soar.”
The Soros name-change was an effort to protect the Jewish family from the rise of fascist rulers and the whole family spoke Esperanto at home.
As a native Esperanto speaker, (someone who has spoken Esperanto from birth), George Soros defected to the West in 1946, while attending an Esperanto youth meeting in Switzerland.
Esperanto enabled Soros both to defect, and to become the 28th most wealthy man in the World, according to the Forbes rich list.
#2. J Gilbert 04.05.2009
Maybe Centaurus Energy is connected to Bear Stearns Centaurus Energy because they have similar names and are located at the same address in Houston, Texas.
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