Hedge Fund and Private Equity Executives on the Forbes 400 List of Wealthiest Americans

Double-dip recessions, sovereign debt crises and political gridlock notwithstanding, it's been a good year for hedge fund billionaires.

Alternative investments players make up some 16% of this year's Forbes 400 list of the wealthiest Americans. One of them even cracks the top 10: George Soros, who is now a retired hedge fund manager, did very well for himself in Soros Fund Management's last year of managing money for outside investors. Soros' fortune now totals $22 billion, up almost $8 billion from last year and good enough for seventh place on the list.

No other hedge fund or private equity honcho cracked that elite group, but 18 others made the top 100. And most of them boast larger fortunes than last year, some of them significantly larger.

Despite his miserable year, Paulson & Co.'s John Paulson remains the second-richest hedge fund manager in the country, with a $15.5 billion fortune, 17th on the list and $3.1 billion higher than a year ago. Dell Inc. and MSD Capital founder Michael Dell was one spot behind with $15 billion, followed by Soros' fellow retiree Carl Icahn in 25th place with $13 billion ($2 billion more than last year), Ronald Perelman in 26th with $12 billion ($1 billion more) and James Simons in 30th with $10.6 billion ($1.9 billion more).

Steven Cohen was 35th on the list with $8.3 billion ($1 billion more than last year), Ray Dalio 44th with $6.6 billion (up $1.6 billion), David Tepper in 60th with $5 billion (up $700 million) and Stephen Schwarzman and Sam Zell in 66th with $4.7 billion (up $600 million and $300 million, respectively). Another hedge fund retiree, Caxton Associates' Bruce Kovner, was in 74th place with $4.3 billion ($200 million more than last year).

Two alternatives players dropped off the list this year. Blackstone Group co-founder Peter Peterson has given away a huge chunk of his fortune over the past year, while Maverick Capital Management's Samuel Wyly, who just made the cut last year, fell short this year. Wyly is facing Securities and Exchange Commission fraud charges and this year lost his brother and business partner, Charles Wyly, in a car accident. 

(Source: FINAlternatives, Oct 3, 2011)

Hedge Fund and Private Equity Executives
on the Forbes 400 List of Wealthiest Americans

rank	billionaire	firm	net worth
7	George Soros	Soros Fund Management	$22 billion
17	John Paulson	Paulson & Co.	$15.5 billion
18	Michael Dell	MSD Capital	$15 billion
25	Carl Icahn	Icahn Enterprises	$13 billion
26	Ronald Perelman	MacAndrews & Forbes	$12 billion
30	James Simons	Renaissance Technologies	$10.6 billion
35	Steven Cohen	SAC Capital Advisors	$8.3 billion
44	Ray Dalio	Bridgewater Associates	$6.6 billion
60	David Tepper	Appaloosa Management	$5 billion
66	Stephen Schwarzman	The Blackstone Group	$4.7 billion
66	Samuel Zell	Equity Group Investments	$4.7 billion
73	Bruce Kovner	Caxton Associates	$4.3 billion
75	Daniel Ziff	Och-Ziff Capital Management	$4.2 billion
75	Dirk Ziff	Och-Ziff Capital Management	$4.2 billion
75	Robert Ziff	Och-Ziff Capital Management	$4.2 billion
86	Henry Kravis	Kohlberg Kravis Roberts	$3.7 billion
88	Robert Bass	Oak Hill Capital Management	$3.6 billion
91	John Arnold	Centaurus Energy	$3.5 billion
96	George Roberts	Kohlberg Kravis Roberts	$3.4 billion
107	Leon Black	Apollo Management	$3.2 billion
107	Ron Burkle	Yucaipa Cos.	$3.2 billion
107	Paul Tudor Jones	Apollo Management	$3.2 billion
117	Edward Lampert	ESL Investments	$3 billion
139	William Conway	The Carlyle Group	$2.7 billion
139	Daniel D'Aniello	The Carlyle Group	$2.7 billion
139	David Rubenstein	The Carlyle Group	$2.7 billion
150	Daniel Och	Och-Ziff Capital Management	$2.6 billion
159	Stanley Druckenmiller	Duquense Capital Management	$2.5 billion
159	Tom Gores	Platinum Equity	$2.5 billion
166	Julian Robertson	Tiger Management	$2.4 billion
171	Nicolas Berggruen	Alpha Investment Management	$2.3 billion
171	Kenneth Griffin	Citadel Investment Group	$2.3 billion
188	Philip Falcone	Harbinger Capital Management	$2.2 billion
188	Henry Hillman	Hillman Cos.	$2.2 billion
200	Israel Englander	Millenium Partners	$2.1 billion
200	Wilbur Ross	W.L. Ross & Co.	$2.1 billion
200	David Shaw	D.E. Shaw Group	$2.1 billion
227	David Bonderman	Texas Pacific Group	$1.9 billion
227	James Coulter	Texas Pacific Group	$1.9 billion
227	Alec Gores	Gores Technology Group	$1.9 billion
242	Leon Cooperman	Omega Advisors	$1.8 billion
242	Theodore Forstmann	Forstmann Little	$1.8 billion
260	George Argyros	Westar Capital	$1.75 billion
273	Glenn Dubin	Highbridge Capital Management	$1.6 billion
273	Noam Gottesman	Man Group	$1.6 billion
273	Bruce Karsh	Oaktree Capital Management	$1.6 billion
273	Howard Marks	Oaktree Capital Management	$1.6 billion
293	Stephen Mandel	Lone Pine Capital	$1.5 billion
293	Jonathan Nelson	Providence Equity Partners	$1.5 billion
293	Peter Thiel	Clarium Capital Management	$1.5 billion
309	Joshua Harris	Apollo Management	$1.45 billion
309	T. Boone Pickens	BP Capital	$1.45 billion
309	Marc Rowan	Apollo Management	$1.45 billion
312	Louis Bacon	Moore Capital Management	$1.4 billion
312	Thomas Lee	Lee Equity Partners	$1.4 billion
331	Richard Chilton	Chilton Investment Co.	$1.3 billion
331	Marc Lasry	Avenue Capital Management	$1.3 billion
331	Thomas Steyer	Farallon Capital Management	$1.3 billion
359	James Dinan	York Capital Management	$1.2 billion
359	C. Dean Metropoulos	Metropoulos & Co.	$1.2 billion
359	Nelson Peltz	Trian Partners	$1.2 billion
359	Henry Swicea	Highbridge Capital Management	$1.2 billion
375	Thomas Barrack	Colony Capital	$1.1 billion
375	John Henry	John W. Henry & Co.	$1.1 billion

Goldman Sachs Closing Global Alpha Quant Fund

Goldman Sachs is shuttering a well-known hedge fund that relies on computer-driven trading strategies after the portfolio rang up a hefty loss this year.- Goldman's Global Alpha fund down 13 pct year-to-date, while many other quant funds performing well.

Goldman Sachs is shuttering a well-known hedge fund that relies on computer-driven trading strategies after the portfolio rang up a hefty loss this year. Goldman told investors in the roughly $1.6 billion Global Alpha fund the news Thursday, one day after it announced a management shake-up at the fund that had been the crown jewel of its quantitative trading business. The fund will be closed in the next few weeks.

Global Alpha had tumbled 13 percent by early September, delivering a far worse performance than other hedge funds that rely on computer programs to quickly take advantage of opportunities in the market, people familiar with the number said. These types of funds are supposed to move quickly in and out of stocks, bonds, currencies and other assets and exit positions before losses accrue.

This is the second time in four years the Global Alpha fund -- once one of Goldman's biggest with $12 billion in assets -- has suffered big losses and its performance raises questions about the ability of Goldman Sachs to manage quantitative strategies for its wealthy clients. In fact, people familiar with Goldman Sachs have said the company's decision to liquidate Global Alpha signals its decision to exit quantitative hedge fund strategies altogether. The firm still manages billions in quantitative mutual funds.

Even though Goldman's Global Alpha fund is in the red, most other other quantitative hedge funds are up or are flat for the year. The average quant fund is down less than 1 percent over that period, according to performance tracking service Hedge Fund Research Inc. Mark Carhart, the man who managed the Global Alpha fund with Raymond Iwanowski for more than a decade until 2009, has gained 7 percent net of fees this year at his new hedge fund Kepos Capital, a person familiar with his numbers said.

The new turmoil at Global Alpha comes almost four years to the day after the fund lost 22.5 percent in August 2007, during the early days of the financial crisis. Those losses prompted investors to pull money out.

Even though the fund's performance steadied with a 4 percent gain in 2008 and raced ahead with a 30 percent increase in 2009, assets never recovered. By the time Carhart and Iwanowski left in 2009, the fund had shrunk to $4 billion from its $12 billion peak. Soon after the pair retired, assets shriveled further to about $2 billion. The fund neither gained nor lost money last year, delivering a zero return.

The quantitative group has been beset by departures for some time. More than two dozen left this year alone, people familiar with the numbers said. On Wednesday, Goldman Sachs Asset Management sent a letter to Global Alpha investors notifying them that Katinka Domotorffy, the head of the group's quantitative investment strategies, would retire at year's end. The letter, a copy of which was obtained by Reuters, did not discuss the poor performance of the Global Alpha fund.

What may have hit the Goldman fund especially hard were the unexpected stock market sell offs in early August and recent currency market fluctuations in the wake of the Swiss National Bank's decision to halt the rise of the Swiss franc, people familiar with the fund's models said. Andrew Schneider, president and CEO of Global Hedge Fund Advisors, said the first half of September has been brutal for some large hedge funds, due to unpredictable moves in market direction.

"The volatility has been so high; if you're wrong, especially if you're using margin or leverage, your returns are going to be extremely poor," said Schneider.

Other quantitative hedge funds, however, fared better. James Simons' Renaissance Technologies' Renaissance Institutional Equities fund has gained more than 25 percent this year, said a person familiar with the fund. Another quant fund, QuantZ Capital Management, for instance, is up 12.8 percent through Sept. 6, according to a letter sent to investors.

Renaissance Hedge Fund Founder James Simons Retires

James Simons, who ran the region's most lucrative hedge fund for the past 30 years and donated millions to charities and universities, has retired, a person at his firm said Friday.

Simons, 71, who lives in the Stony Brook area, is to remain at Renaissance Technologies Inc. as nonexecutive chairman, said the person at the firm. Simons started Renaissance in the early 1970s. Renaissance, based in East Setauket, is now the world's sixth-largest hedge fund, according to Institutional Investor's magazine, Alpha.

Forbes this month named Simons to its annual ranking of the nation's 400 wealthiest individuals, placing him at No. 41, with $7.4 billion. He was the only Long Islander to make the list.

"I have led the organization for 31 years . . . and it is definitely time" to retire, Simons said in a letter to Renaissance employees, a copy of which was obtained by Bloomberg News.

Renaissance officials on Friday made no public comment.

According to Bloomberg, Simons is to remain Renaissance's main shareholder and has no plans to reduce his investment.

He is an intensely private man, rarely making public appearances.

"I don't think he'll ever truly be retired," said Jeff Bass, president of the Long Island Capital Alliance, which links investors with business opportunities.

"He's obviously a brilliant man, and very charitable, too," Bass said. "He revolutionized the financial community by virtue of how he grew his fund, how he made investments and how he managed them."

If anything, Simons' investment strategies were driven by mathematics. He was once chairman of the math department at Stony Brook University. He earned a bachelor of science in math from the Massachusetts Institute of Technology and a doctorate in math from the University of California, Berkeley.

Simons, the son of a shoe factory owner in Massachusetts, began trading commodities in the '60s with Harvard math wiz Charles Freifeld. They tripled their investment, and the experience led Simons to rely on market returns based on mathematical analysis. His donations to charities and education are enormous. Last year, he gave $60 million to Stony Brook University. In 2006, he raised $13 million to keep a major nuclear physics experiment running at Brookhaven National Laboratory.

(from newsday.com, October 9, 2009)