HEDGE FUNDS: Top hedge funds make record $67bn in profits for 2023

As published on: theguardian.com, Monday 22 January, 2024.

Billionaire hedge fund managers Chris Hohn and Ken Griffin led the industry to record profits last year as bets on the stock market paid off handsomely for clients.

The top 20 hedge fund managers made $67bn (£53bn) in profits for investors in 2023, as the industry made combined profits of $218bn, topping the previous record of $65bn set in 2021.

TCI Fund Management, which is run by British billionaire Hohn, who paid himself $346m last year, topped the list making $12.9bn for clients.

Citadel, founded by the US billionaire Ken Griffin, who has been involved in a bid for the Telegraph newspaper with the co-owner of GB News, ranked second, making $8.1bn.

The list, compiled by the research company LCH since 2012, examines which money managers in the $4tn hedge fund industry are the most successful based on overall profits in absolute dollar terms they have made for investors, excluding fees.

The top 20 firms oversee less than one-fifth of the industry’s assets, but generated about one-third of the overall $218bn gained for clients.

The report found that over the past three years the top 20 star hedge fund managers have generated 83% of the gains made by the industry as a whole.

“These managers have been generating above average performance over several decades reflecting the persistence of their superior returns,” said Rick Sopher, the chair of LCH.

“In most cases this reflects an ability to limit the downside in adverse conditions and to make money when conditions are favourable, as they were toward the end of 2023.”

The strong performance of the stock market had carried into the new year with the S&P 500 index of leading shares hitting an all-time high on Friday, driven by the strength of tech stocks.

TCI, which ended last year up by 33%, counts Google-owner Alphabet, Visa and General Electric among its largest holdings.

Other major hedge funds include Andreas Halvorsen’s Viking, which made $6bn last year, and the US billionaire Bill Ackman’s Pershing Square, which rejoined the top 20 making $3.5bn.

TCI and Pershing Square are the newest funds on the list while Citadel sits among the long standing, founded by Griffin in Chicago in 1990.

The research found that the top 20 managers have created $755.4bn in profits since they were set up, more than the $655.5bn in assets they have under management.


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