Hedge Fund Biggest Money Makers- Top Earning Managers

Hedge fund manager biggest money makers personally earned total of $16.7 billion. Here is the list of Forbes top 40 hedge fund manager with biggest earnings.

David Tepper

David Tepper

David Tepper

Rank: 1

Firm: Appaloosa Management

Earnings: $2.2 billion

David Tepper, 55, continues to make a good case that he is one of the great hedge fund investors of all time. While most hedge funds underperformed the U.S. stock market in 2012, Tepper trounced it. His flagship hedge fund successfully bet on stocks and other securities at key moments in 2012, posting a net return of nearly 30%. His $15 billion Appaloosa Management has been knocking out annual net returns of about 30% since 1993. Tepper gave back some cash to his investors at the end of the year. He has continued to focus his philanthropy on educational efforts like Teach for America and feeding the hungry in his home state of New Jersey, where he has donated significantly to food banks over the past five years.

 

Carl Icahn

Carl Icahn

Carl Icahn

Rank: 2

Firm: Icahn Capital

Earnings: 1.9 billion

At 77, Icahn enjoyed another strong run in 2012, beating the U.S. stock market and most hedge fund managers. The investment pool he manages for himself and his employees returned 28% in 2012, thanks to bets on Hain Celestial Group and CVR Energy.

 

Steve Cohen

Steve Cohen

Steven Cohen

Rank: 3

Firm: SAC Capital Advisors

Earnings: $1.3 billion

The federal government is breathing down his neck with an insider-trading investigation that has spooked some of his investors, but that did not stop Cohen, 57, from making money in financial markets. In 2012, his Stamford, Ct., SAC Capital Advisors, which manages $14 billion, posted gross returns in the 25% range. That was not enough for Cohen to deliver a U.S. stock market beating performance for his investors after he charged them his customary steep fees, but a net return of 13% was still better than the vast majority of hedge fund managers.

 

Jim Simons

Jim Simons

James Simons

 

Rank: 3

Firm: Renaissance Technologies Corp.

Earnings: $1.3 billion

The “Quant King” retired from his $20 billion hedge fund firm, Renaissance Technologies, in 2010, but at 74 he continues to play a role at the firm and benefit from its funds, particularly the secretive and consistently profitable black-box strategy known as Medallion. Not all of the firm’s funds, however, had a good year in 2012 and two of Renaissance’s funds actually lost money. The MIT grad started his career as a theoretical mathematician and was a code breaker for the U.S. Department of Defense during the Vietnam War. He later was head of the math department at SUNY-Stony Brook. In 1982 he founded Renaissance, which is based in East Setauket, N.Y. The fund uses computer modeling to find inefficiencies in highly liquid securities. Simons has contributed well over $1 billion to his Simons Foundation, chairs Math for America, and supports autism research.

 

George Soros

George Soros

George Soros

Rank: 5

Firm: Soros Fund Management LLC

Earnings: $1.1 billion

At 82, this hedge fund legend is chairman of Soros Fund Management, the $24 billion firm that manages his personal fortune as well as the money belonging to his foundations, which support causes ranging from human rights to education and public health. He is not involved in day-to-day operations, which are overseen by Scott Bessent, Soros Fund Management’s chief investment officer, but Soros remains involved. The firm’s recent and successful big bet against the yen was classic Soros. His firm returned the relatively little client money it managed in 2011. His internal team manages the majority of the assets while the rest has been farmed out to other money managers. The firm’s performance trailed the U.S. stock market in 2012, but was firmly in positive territory.

 

Ken Griffin

Ken Griffin

Ken Griffin

Rank: 6

Firm: Citadel LLC

Earnings: $900 million

The 44-year-old founder of Chicago-based Citadel, which manages $14 billion, is on a winning streak. After battling back from a catastrophic year in 2008, Citadel’s flagship Kensington and Wellington funds blew past their high water marks at the end of 2011, a year in which the funds returned more than 20% net of fees. The trend continued in 2012, as the pair finished up an impressive 25%. Though the firm is best known for its hedge funds, Citadel also houses a growing securities business, which currently accounts for 14% of U.S. consolidated equity volume.

 

 

Ray Dalio

Ray Dalio

Ray Dalio

Rank: 7

Firm: Bridgewater Associates

Earnings: $800 million

The king of the rich hedge fund industry, Dalio lords over the world’s biggest hedge fund firm, Bridgewater Associates, with about $140 billion in assets. By his standards, 2012 was a disappointing year, with his flagship hedge fund strategy underperforming both the average hedge fund and the U.S. stock market. His All Weather strategy performed much better. Bridgewater’s popularity and esteem with the investment community remains incredibly strong. He founded Bridgewater in his Manhattan apartment in 1975. Now at age 63, he is doing all he can to ensure its survival, ceding more responsibility and selling ownership stakes in his firm to his employees and clients. Also on the drawing board: A new $750 million headquarters Dalio is working to build in Stamford, Ct.

 

 

David Shaw

David Shaw

David Shaw

 

Rank: 8

Firm: D.E. Shaw & Co., LP

Earnings: $625 million

Shaw’s D.E. Shaw & Co. continued to perform well in 2012. The firm’s flagship Oculus fund closed the year up 18% net of fees, with the slightly smaller Composite International fund finishing just behind it at 15.6%. Though Shaw is no longer involved in day-to-day operations at D.E. Shaw & Co., the Stanford PhD continues to oversee higher-level decisions affecting the fund manager. Shaw also serves as an Adjunct Professor of Biomedical Informatics at Columbia University’s medical school.

Leon Cooperman

Leon Cooperman

 

Leon Cooperman

Rank: 9

Firm: Omega Advisors

Earnings: $470 million

At age 69, Leon Cooperman outperformed the vast majority of money managers in 2012, guiding his $6.6 billion Omega Advisors hedge fund to net returns of more than 25%. Cooperman grew up in the South Bronx and started his career as a Xerox quality control engineer in 1965. After earning his MBA at Columbia University, Cooperman joined Goldman Sachs, where he rose to the head of the bank’s asset management business. He departed in 1991 to found Omega, his own fund management company.

 

 

Dan Loeb

Dan Loeb

Dan Loeb

Rank: 10

Firm: Third Point

Earnings: $425 million

The founder and head of hedge fund firm Third Point had a fabulous year in 2012. His flagship hedge fund beat the U.S. stock market, which most hedge funds failed to do, with a 21.2% net return. His smaller leveraged fund was one of the best-performing hedge funds in 2012. The New York investor has enjoyed big years before, but now he is managing $10 billion. He made money betting on Greek sovereign debt and on a couple of activist positions. Loeb led a successful effort to dislodge Scott Thompson from the CEO position at Yahoo and replace him with Marissa Mayer. The stock has been a winner for Loeb as has his activist position in Murphy Oil. Now 51, Loeb made news early in 2013 by taking a position in Herbalife, the nutritional supplements seller, shortly after another prominent hedge fund manager, William Ackman, called the company a pyramid scheme.

 

Michael Hintze

Michael Hintze

Michael Hintze

 

Rank: 11

Firm: CQS LLP

Earnings: $350 million

Former Australian army captain dominated the markets in 2012. CQS’ flagship Directional Opportunities fund, which Hintze manages personally, returned nearly 36% net of fees last year. The papal knight is well known in the U.K. for his consistent support of the Conservative Party. Hintze also owns thousands of acres of Australian farmland. Assets under management at CQS now stand at nearly $12 billion.

 

Stephen Mandel, Jr.

 

Rank: 11

Firm: Lone Pine Capital

Earnings: $350 million

Mandel, 57, returned to crushing the markets in 2012, with all of his funds ending the year up more than 22% net. His $23 billion hedge fund firm, Lone Pine Capital, was named for a mythical Dartmouth College pine tree that survived an 1887 lighting strike. The Goldman Sachs and Tiger Management alumnus scored big in 2012 with stakes in fashion retailers including Michael Kors and The Gap.

 

Chase Coleman

Chase Coleman

Chase Coleman III

 

Rank: 13

Firm: Tiger Global Management

Earnings: $325 million

The hottest young money manager on the planet, Coleman cooled off a touch in 2012, but his Tiger Global hedge fund, which he co-manages with Feroz Dewan, still beat the U.S. stock market and most other hedge funds out there. At 37, Coleman extended his impressive winning streak, finishing a third straight year with a net return in excess of 20%. Among his savvy moves: creating venture capital vehicles to invest in hot private tech companies like Facebook prior to their initial public offerings. Tiger Global’s Facebook investment was led by Lee Fixel and Scott Shleifer and the firm smartly sold a big chunk of its stake in Facebook in the IPO.

 

Andreas Halvorsen

Andreas Halvorsen

Andreas Halvorsen

 

Rank: 13

Firm: Viking Global Investors

Earnings: $325 million

This former Norwegian Navy Seal is one of the most successful Tiger cubs in the game and 2012 was no different for his $18 billion hedge fund firm. Viking Global’s flagship fund was up 12.8% net last year while the long-only fund (which Halvorsen closed to new investors last year) was up an impressive 23% net. Among some of his biggest positions last year were News Corp, Visa and hedge fund favorite, Apple.

 

 

 

Bill Ackman

Bill Ackman

Bill Ackman

 

Rank: 15

Firm: Pershing Square Capital Management

Earnings: $300 million

There has been no shortage of drama for this hedge fund manager. The activist investor turned up the heat in late 2012 announcing a massive short position in Herbalife, calling the nutritional supplement company a pyramid scheme. Rival hedge fund titans countered him with Daniel Loeb announcing a long position in Herbalife and Carl Icahn questioning Ackman’s investment skills all together in an epic CNBC showdown before he announced a big stake in the company. His main hedge fund posted returns in the 12% range in 2012, trailing the U.S. stock market.

 

Paul Tudor Jones II

Rank: 15

Firm: Tudor Investment Corporation

Earnings: $300 million

Jones’ flagship BVI Global fund, which runs the vast majority of Tudor’s assets, recorded a 6.3% net return in 2012. Tudor Investment’s relatively tiny Tensor fund, on the other hand, continued to struggle. After ending 2011 down 10.3%, the fund again failed to finish 2012 in the black, closing the year down 2.2%. In business for over three decades, Tudor now manages nearly $12 billion. Jones founded New York City’s iconic poverty-fighting Robin Hood Foundation in 1988.

 

 

John Paulson

Rank: 17

Firm: Paulson & Co.

Earnings: $275 million

It has been a tough couple of years for the hedge fund manager who pulled off the greatest trade ever. But even though his Paulson Advantage funds were down big again in 2012, some of Paulson’s other funds, like Paulson Credit Opportunities and Paulson Partners, were up. According to an investor letter, the weighted average performance of all of Paulson’s funds for 2012 was up 1% net of management fees (his funds could not charge performance fees in 2012) and more than 65% of the firm’s assets were in positive territory last year. Because Paulson has such a huge personal stake in his funds, he made money with such a performance.

 

Philip Falcone

Philip Falcone

Philip Falcone

Rank: 18

Firm: Harbinger Capital Partners

Earnings: $250 million

Former Harvard hockey player made billions of dollars shorting subprime, then blew a ton of money on LightSquared, a controversial attempt to convert satellite radio frequencies into a new cellular service that filed for bankruptcy protection. He has been sued by the Securities & Exchange Commission, but his hedge funds performed very well in 2012 after LightSquared bonds recovered and shares in his publicly-traded Harbinger Group, in which his hedge funds have a big position, soared. Falcone didn’t earn any performance fees, but since a big percentage of the assets managed by his hedge funds belong to him, he made money.

 

Israel Englander

Rank: 19

Firm: Millennium Management, LLC

Earnings: $225 million

Millennium Partners booked another winning year in 2012, finishing up 6.4% net of fees. Englander founded Millennium in 1990 with $35 million in capital. Today the firm runs $17.8 billion. A hedge fund purist, “Izzy” doesn’t charge a fixed management fee. Rather he simply passes expenses through to his investors, earning fees only in years that he makes them money.

 

Michael Platt

Michael Platt

Michael Platt

 

Rank: 19

Firm: BlueCrest Capital Management

Earnings: $225 million

After almost a decade at JP Morgan, Michael Platt founded BlueCrest in late 2000. Over the decade-plus since the London-based firm’s assets under management have swelled to $30 billion. The $12 billion flagship, the multi-strategy BlueCrest International Fund, gained 5.8% net of fees in 2012.

 

 

James Dinan

James Dinan

James Dinan

Rank: 21

Firm: York Capital Management Group

Earnings: $200 million

After a rare down year in 2011, Dinan came roaring back in 2012. York’s flagship Multi-Strategy fund posted a solid 13.5% net return on the year, while the firm’s Credit Opportunities fund finished 2012 up 19%. Dinan, 53, a graduate of Wharton and Harvard Business School, got his start at Donaldson, Lufkin & Jenrette. He launched York Capital in 1991 with $3.6 million from his DLJ colleagues. Dinan sold 33% of York Capital to Credit Suisse in September 2010.

 

Alan Howard

Rank: 21

Firm: Brevan Howard Asset Management

Earnings: $200 million

Assets under management at his Geneva-based Brevan Howard hedge fund firm now total $39 billion and the firm continues to hire talent away from banks and is again expanding its operations in the U.S. Howard’s $28 billion Master Fund returned 3.8% net of fees in 2012. Howard, 49, launched the firm in 2002 when he and four other Credit Suisse proprietary traders went solo. The group sold a 15% stake in the business to Swiss Re in 2007 for an undisclosed sum.

 

Daniel Och

Rank: 21

Firm: Och-Ziff Capital Management

Earnings: $200 million

His $21.5 billion Master fund led the way for his massive hedge fund firm in 2012, netting an 11.2% return. Och’s Europe fund and Global Special Investments fund also recorded gains, rising 8.6% and 9.4%, respectively. Assets under management at the firm are up to $31.6 billion, thanks in part to commitments from large institutional investors like the Florida State Board of Administration’s pension fund, which kicked in $150 million in July. Och launched his firm in 1994 with a reported $100 million from the billionaire Ziff brothers.

 

Paul Singer

Paul Singer

Paul Singer

Rank: 21

Firm: Elliott Management

Earnings: $200 million

At 68, the former Wall Street lawyer is the founder of hedge fund firm Elliott Management, which oversees $21 billion in assets. Its two main funds returned more than 12% in 2012. Singer’s hedge fund has been waging a high-profile battle with Argentina over defaulted bonds, going so far in 2012 as to convince the government of Ghana to at one point take possession of an Argentine naval vessel. Elliott’s investments include backing the movie version of Les Miserables and a lawsuit against Walt Disney Co., over Stan Lee’s iconic superhero characters. The hedge fund also frequently takes activist positions, like its recent investment in Hess Corp.

 

Glenn Dubin

Rank: 25

Firm: Highbridge Capital Management

Earnings: $150 million

Highbridge turned in a solid performance in 2012, with its flagship fund finishing up 11% net of fees. The firm’s Long/Short equity fund and Statistical Opportunities funds were also winners, returning 11% and 5.2% respectively. Named for the oldest bridge in New York City, Dubin founded Highbridge with childhood friend and fellow billionaire Henry Swieca in 1992. The pair sold a majority stake in Highbridge to JPMorgan Chase & Co., in 2004.

 

David Einhorn

David Einhorn

David Einhorn

Rank: 25

Firm: Greenlight Capital

Earnings: $150 million

The founder and head of hedge fund firm Greenlight Capital, which has delivered annualized returns north of 19% since inception in 1996, had a bit of a frustrating year in 2012. His hedge fund trailed the U.S. stock market as a big bet on Apple soured near the end of the year. He has been actively pushing Apple to return capital to shareholders, going so far as to sue the company over corporate governance matters in February. Einhorn, 44, is known for sometimes successfully betting against companies like Allied Capital in 2002 and Lehman Brothers, ahead of its bankruptcy. More recently, he successfully shorted Green Mountain Coffee.

 

 

Joshua Friedman

Rank: 25

Firm: Canyon Capital Advisors

Earnings: $150 million

Former Goldman Sachs and Drexel Burnham Lambert banker who co-founded Canyon Capital Advisors with Mitchell Julis. The $19 billion hedge fund business invests in bank debt, high yield and distressed securities, securitized assets, convertible arbitrage and risk arbitrage. Canyon’s $8 billion flagship fund returned a net of 18.06% last year.

 

Mitchell Julis

Rank: 25

Firm: Canyon Capital Advisors

Earnings: $150 million

Julis knows a thing or two about distressed debt. His first job out of Harvard Law was as a bankruptcy lawyer in New York. Two years later he took a job offer from junk bond king Michael Milken’s Drexel Burnham in Los Angeles where he oversaw a portfolio of distressed and special situation securities. When it closed shop in 1990 Julis and Joshua Friedman (also on this year’s list), launched Canyon Capital Advisors, which boasts some $19 billion in assets and includes the firm’s hedge fund business as well as a real estate investing and lending business. Canyon’s flagship Value Realization fund scored a net return of 18.06% last year.

 

Barry Rosenstein

Rank: 29

Firm: Jana Partners

Earnings: $140 million

Wharton grad started at Merrill, ran Sagaponack Partners before starting activist hedge fund Jana Partners in 2001. With about $4.5 billion in assets and commitments and a 23% return at its flagship fund last year, Jana pushed breakups at McGraw-Hill, Agrium and El Paso, among others.

 

John Arnold

John Arnold

John Arnold

Rank: 30

Firm: Centaurus Advisors

Earnings: $125 million

The king of natural gas shocked the hedge fund world in May 2012 when he announced he was calling it a career at age 38. “After seventeen years as an energy trader, I feel that it’s time to pursue other interests,” wrote the former Enron star, who is said to have made $750 million for the defunct energy giant in 2001. With his wife Laura, Arnold plans to focus his energies on their $1.3 billion Laura and John Arnold Foundation. Centaurus was up 4% net of fees through May, when Arnold began returning capital to his investors.

 

Seth Klarman

Rank: 30

Firm: Baupost Group

Earnings: $125 million

A value investor known for avoiding leverage and holding cash. Klarman’s Boston-based Baupost Group has seen its assets under management balloon in recent years to $26 billion as new money flowed in. Klarman, 55, has tried to keep a low-profile. His out of print book Margin of Safety (which sells for $2497.00 on Amazon.com) has become a new bible of value investing. Baupost posted a net return of 7.6% in 2012, trailing the U.S. stock market. “While our return for the year was not scintillating, we regard it as acceptable considering the limited risk incurred to achieve it,” Klarman told his investors in a January letter. His Baupost did do well with its big position in distressed debt of Lehman Brothers. He set up his Klarman Family Foundation, which has $255 million in assets, to back scientific research, promote access to music learning and support causes in Israel.

 

Marc Lasry

Marc Lasry

Marc Lasry

Rank: 30

Firm: Avenue Capital Group

Earnings: $125 million

In the wake of a down year in 2011, Avenue’s funds bounced back in 2012, producing net returns in the 15% range on the year. Lasry claimed a second victory in 2012 when Barack Obama won a second term in the White House. In June, Lasry hosted a $40,000 per plate fundraiser for the president’s campaign at his Upper East Side home. Lasry founded his now $12.2 billion firm in 1995 with his sister, Sonia Gardner.

 

Deepak Narula

Rank: 30

Firm: Metacapital Management

Earnings: $125 million

The son of an Indian diplomat and Columbia Business School grad learned to trade mortgage bonds at Lehman. His flagship $1.46 billion hedge fund that specializes in mortgages became one of the top-performing hedge funds on the planet in 2012, posting a net return of 41.25% by going long agencies.

 

 

Ottavio Biondi

Rank: 34

Firm: King Street Capital Management

Earnings: $100 million

Yale, Harvard Business School grad started at First Boston and founded King Street, a distressed-debt fund, in 1995 with Brian Higgins. Performance slipped as the firm powered past $17 billion in assets, although its flagship fund was up 12.4% net in 2012.

 

Richard Chilton Jr.

Rank: 34

Firm: Chilton Investment Company

Earnings: $100 million

Chilton Investments’ flagship fund produced a 12% net return in 2012. An alumnus of both Merrill Lynch and Allen & Co., Chilton founded Chilton Investment Company in 1992. The firm currently manages $5 billion. Chilton is a member of the board of trustees of the Metropolitan Museum of Art.

 

Robert Citrone

Robert Citrone

Robert Citrone

Rank: 34

Firm: Discovery Capital Management

Earnings: $100 million

Emerging markets star Robert Citrone went from Fidelity to legendary fund manager Julian Robertson’s Tiger Management before striking out on his own in 1999 by co-founding Discovery Capital. The Connecticut-based firm had a pretty good 2012, with its Global Opportunity Fund returning about 15% net of fees and increasing assets under management to over $6.2 billion.

 

Brian Higgins

Rank: 34

Firm: King Street Capital Management

Earnings: $100 million

Founder, with Francis Biondi, of King Street Capital Management in 1995, a $17 billion distressed-debt fund that racked up a solid performance through the financial crisis but lagged in the recovery.

 

Thomas Steyer

Thomas Steyer

Thomas Steyer

Rank: 34

Firm: Farallon Capital Management

Earnings: $100 million

The 55-year-old founder of Farallon Capital Management, the $19 billion San Francisco hedge fund firm, retired at the end of 2012 and sold his stake in the hedge fund firm to his partners. Steyer’s last year at Farallon was decent enough, with his flagship hedge fund returning 11.42% net, though the performance trailed the U.S. stock market.

 

 

Peter Brown

Rank: 39

Firm: Renaissance Technologies

Earnings: $90 million

Worked as language technology expert at IBM. Joined Renaissance Technologies in 1993, promoted to co-chief executive after founder James Simons retired. Talkative and competitive, he’s socially liberal and fiscally conservative, owns one home and drives a Prius. He wrote a computer program to seat people at his wedding. Has ridden a unicycle in the office. Is the son of Henry Brown, who invented the money-market fund.

Robert Mercer

Robert Mercer

 

Robert Mercer

Rank: 39

Firm: Renaissance Technologies Corp.

Earnings: $90 million

Former IBM language recognition specialist joined Renaissance in 1993. Mercer, 65, took over as co-CEO when Renaissance founder James Simons retired. Politically conservative. Has huge model train in home basement.

 

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