Billionaire hedge fund playboys party and nightlife hotspots in UK
How do you spot a Mayfair multi-millionaire at play? Simple. Just hit the Londons exclusive nightclubs on a Thursday — or Hedge Fund Night, as it is known to habitués. Why Thursday? Well, no self-respecting hedgie would be seen dead in town after Friday teatime. They’ve all driven off to their country estates or climbed aboard the private jet for a weekend ski-ing.
‘Thursday is for entertaining clients — and it’s on expenses,’ says Jonny Dodge, owner of hedge fund haunt Aura, a private members’ club in London’s St James’s.
At one of these, a financier bid thousands of pounds for a bottle of Pommery champagne, with a free gift thrown in: a trip, by private jet, to the vineyard in France.
‘He took me with him, which was great,’ says Dodge.
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There are always plenty of pretty girls in attendance.
One of them, until recently, was Russian spy Anna Chapman (left) View View- Hottest pics and facts of Anna Chapman . She used to accompany her boss, the hedge fund guru Nicholas Camilleri of Navigator Asset Management, on his weekly Thursday trips to Annabel’s nightclub in nearby Berkeley Square, where she would rub shoulders with the likes of property tycoon Vincent Tchenguiz.
So it’s safe to say that austerity Britain is not having much impact on the hedge fund barons.
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But there are plenty of London hedge fund bosses who would disdain to get out of bed for such paltry sums. The latest accounts from one leading firm, Brevan Howard, revealed its top partners shared £200 million for the year to the end of March.
A large chunk of that will have gone to founder Alan Howard, whose estimated personal wealth already stood at £875 million.
Howard lives with his French wife, Sabine, in Hampstead and owns a £7.5 millionapartment in Manhattan.
To him, it would have been small change to shell out the £25,000 each he paid to the singer Pixie Lott and boy band JLS to perform at his 13-year-old son Daniel’s bar mitzvah celebrations last year.
Fellow hedge fund magnate Crispin Odey paid himself £34 million last year and another top fund manager, Jonathan Ruffer, took home £10 million.
Then there is Jeffrey Meyer, who a few days ago bagged more than £11 million by selling his fund management group Gartmore to rival Henderson in a rescue deal.
His rich reward came despite a catalogue of disasters at the firm, which was sold for less than half the price when it was floated on the stock market just over a year ago.
Those who want to make real money aim to get into hedge funds, which claim to deliver super-charged returns no matter what is happening on the stock markets.
And while the rest of the UK tightens its belt this year, the hedge fund party circuit shows no sign of flagging.
The annual EuroHedge dinner, the industry’s equivalent of the Oscars, is being held on — when else? — a Thursday night this month, in the grand surrounds of the Grosvenor House Hotel and it is likely to be as self-congratulatory as ever.
Security at the event will be tight, as the hedge funders are desperate to avoid the headlines that have been heaped on their poor relations, the bankers.
The hedge fund boom is good business for Jonny Dodge, who is hosting a party at the Coco Club, a private members’ establishment in the posh Swiss ski resort of Verbier in a couple of weeks’ time.
The drinks menu boasts ‘Europe’s most extravagant cocktail’, the Coco Chalet, which is a hand-carved ice chalet containing vintage champagne and ‘secret elixirs’ — and costing £6,500 each.
Probably best not to have one before taking part in the supercar rally, also taking place.
‘The cars are McLarens or gold Bugattis costing £300,0000 to £400,000 each,’ Jonny says.
‘We go where the jet-set go.’
One place the hedge funders definitely don’t go, if they can help it, is the City. The centre of hedge world is Mayfair and it is just so much more congenial there than rubbing shoulders with the bank clerks in the Square Mile.
All the amenities for a civilised existence are a short stroll away: the bespoke tailors of Savile Row, George Trumper’s English barber shop on Curzon Street, James Purdey’s gun emporium on South Audley Street and Davidoff on St James’s for fat Cuban cigars.
‘A lot of the hedge funds use their offices as art galleries. If you have a real Picasso hanging up, it sends a message to clients.’
Mayfair is home to the second biggest hedge fund centre in the world, after Wall Street, with more than £200 billion of assets controlled from offices nestling behind discreet brass plates. Curzon Street, one of the main thoroughfares, is now nicknamed Hedge Fund Alley.
But just who are the hedgies, how do they make their millions and why, apart from awed fascination at their riches, should the rest of us care?
A typical member of the secretive elite will be aged in his late 40s or early 50s — the generation that cut its teeth in the heady ‘greed is good’ atmosphere of Gordon Gekko’s Wall Street
They are men like Paul Marshall, co-founder of the multi-billion Marshall Wace fund, who last year told MPs that accusing hedge funds of causing the financial crisis was like blaming passengers for a bus crash.
Meanwhile, Odey, 51, and his wife Nichola Pease, 49, sit effortlessly at the top of Mayfair’s hedge fund tree.
The pair, who live with their three children in a quiet Chelsea street where properties are valued at £10 million, are charming and well-connected. Pease is one of the few women to rank as a formidable hedge fund player in her own right, despite blotting her copybook by failing to spot problems at Northern Rock, where she was a director.
She comes from a rich Quaker dynasty, which made its fortunes in the North East during the Industrial Revolution and today has its tentacles throughout the City.
Her brother-in-law is former Barclays chief executive John Varley and her brother is a leading fund manager, too.
She is the second wife of Oxford-educated Odey — his first was Rupert Murdoch’s daughter, Prudence.
Most people associate hedge funds with amoral profiteering and high-stakes betting and believe they are run by bogeymen who deliberately drive down the stock market by short-selling (an Alice In Wonderland manoeuvre involving the sale of shares that investors don’t actually own).
In this complicated world of finance, hedgies use a range of arcane techniques to bet on the value of shares, bonds, currencies, gold and other assets on behalf of wealthy individuals and pension funds. The most famous exponent was George Soros, who made £1 billion by betting against the pound before John Major withdrew Britain from the European Exchange Rate Mechanism in 1992.
Most controversially, in the financial crisis they have been betting on the downfall of banks — and gambling that countries, such as Greece and Ireland, will be driven into insolvency.
Although critics say hedgies deliberately target the weak and have the probity of a playground bully, they deny all responsibility for the havoc in the financial markets.
So what do the hedge funders do with all their money?
Having acquired their millions, many are keen to burnish their image with a little culture and it is not unusual to step inside the portals of a Mayfair office and find an Old Master or a Damien Hirst on the wall.
‘A lot of the hedge funds use their offices as art galleries,’ says Mark Hedley, editor of Hedge magazine. ‘If you have a real Picasso hanging up, it sends a message to clients.’
The industry is producing its latter-day versions of the Medicis, the great patrons of art in Renaissance Florence, not least Michael Platt of BlueCrest Capital.
The 42-year-old, who is reported by the rich lists to have amassed a personal wealth of £375 million, was brought up in a relatively modest household in Preston, Lancashire. But his hedge fund success has allowed him to indulge a passion for art.
He has ploughed £5 million into a fund, All Visual Arts, with well-known gallerist Joe La Placa.
La Placa says: ‘Hedgies buy art as it helps them to deal with their stress and get a different perspective. It might even make them think differently about the markets.’
Platt’s interest in art, however, does not preclude other rich man’s toys, including a Bombardier Challenger 604 private jet.
Along with buying art, charitable giving is virtually de rigueur for the hedgies. Fund manager Arpad Busson, best-known for squiring beauties such as model Elle Macpherson and actress Uma Thurman, hosts an annual gala to raise money for his Absolute Return For Kids charity.
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It is one of the hottest tickets on the social calendar, with a charity auction featuring prizes such as a flight by private jet to a vast yacht on the Mediterranean for a week’s cruise, which went for £310,000 last year.
Not all of the charitable giving is done in glitzy style, however.
Among those who support low-key causes is Jonathan Ruffer, whose projects have included the Good Shepherd Mission in the deprived area of Bethnal Green in the East End of London. Unlike Busson, most hedge fund princelings are publicity-shy to the point of paranoia and their instinctive secrecy is condoned by financial regulators.
Unlike other types of investment firms, the funds are lightly governed because they are assumed to be dealing with sophisticated investors.
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