Top hedge funds earned sharply less for clients in 2022, LCH data shows

By Svea Herbst-Bayliss

-The 20 finest performing hedge fund managers earned $22.4 billion for traders in 2022, marking their slimmest features since 2016 as many companies, together with Tiger World Administration, struggled with slumping monetary markets, LCH Investments information present.

The highest 20 managers, led by Ken Griffin’s Citadel, Bridgewater Associates and D.E. Shaw Group, made lower than half of the $65.4 billion the group returned in 2021 when rising inventory costs led to a file return. As compared, they made $63.5 billion in 2020 and $59.3 billion in 2019.

Citadel’s achieve of $16 billion final 12 months was the biggest annual achieve ever made by a hedge fund supervisor, LCH stated.

In 2022, when fears of rising rates of interest and geopolitical uncertainty weighed on markets, funding companies that centered on buying and selling methods and guess on macroeconomic tendencies reaped features. These with methods linked to market strikes stumbled.

Rick Sopher, chairman of LCH, a fund of funds agency that tracks returns and is a part of the Edmond de Rothschild Group, stated 2022 was a 12 months of “nice divergence” during which a number of of the highest 20 managers managed to make features for his or her traders regardless of the numerous falls in fairness and bond markets.

Final 12 months will largely be remembered as a tricky one, with the broader S&P 500 index dropping 20% and blue chip hedge fund managers like Tiger World and Third Level nursing losses. General, hedge funds misplaced $208 billion in 2022 for shoppers, marking the largest single-year decline since 2008, once they misplaced $565 billion, LCH information confirmed.

Hedge funds, which had been collectively managing $3.3 trillion on Dec. 31, 2022, in line with eVestment information, usually promise to outperform, particularly when markets are stumbling.

There was a shakeup among the many highest performers as Griffin’s Citadel moved into the highest spot forward of Bridgewater, which earned $6.2 billion.

D.E. Shaw, Millennium Administration, Soros Fund Administration, Elliott Administration, and Viking World Traders additionally ranked within the high 10.

Caxton Associates and Moore Capital, companies helped by macro buying and selling in 2022, made it again onto the listing, LCH stated, whereas Tiger World, whose founder Chase Coleman received his begin at Julian Robertson’s Tiger Administration, and Third Level dropped off the listing.

Citadel, which was based by Griffin in 1990, noticed its flagship Wellington portfolio achieve 38% final 12 months whereas its mounted revenue fund was up 33%, in line with an individual acquainted with the numbers.