Top hedge funds earn $ 63.5 billion in 2020, the highest in a decade: LCH data

BOSTON (Reuters) – The 20 best-performing hedge funds in the world earned $ 63.5 billion for clients in 2020, setting a record for the past 10 years during a chaotic time when tech-oriented equities drove a dramatic rebound. from a pandemic-induced sell-off, LCH Investments data show.

As a group, the most successful managers earned half of the $ 127 billion that all hedge funds earned last year, reported LCH Investments, a return-tracking fund of funds firm and part of the Edmond de Group. Rothschild.

Despite the pandemic that triggered a historic stock market sell-off in March, closed large sectors of the economy and gobbled up millions of jobs, the top 20 hedge funds topped their 2019 yields by $ 59.3 billion. However, 2020 was not as profitable as the previous year for hedge funds as a whole, which saw earnings drop from $ 178 billion in 2019.

The average hedge fund returned 11.6% in 2020, according to data from Hedge Fund Research, lagging behind the 16% gain of the S&P 500 index.

“The net earnings generated by the top 20 managers for their investors of $ 63.5 billion were the highest in a decade. In this sense, 2020 was the year of hedge funds, “Rick Sopher, president of LCH, said in a statement.

Top earnings last year included Chase Coleman’s Tiger Global, which earned $ 10.4 billion, Israel Englander’s Millennium, which earned $ 10.2 billion, and Steve Mandel’s Lone Pine with $ 9.1 billion. Andreas Halvorsen’s Viking Global Investors earned $ 7.0 billion and Ken Griffin’s Citadel earned $ 6.2 billion, according to LCH data.

Ray Dalio’s Bridgewater Associates, founded in 1975, has held the No. 1 position from the start, earning $ 46.5 billion, even after a dire 2020 during which LCH data shows Dalio lost $ 12.1 billions.

George Soros’ Soros Fund Management, which no longer manages money for external clients, remained in second place followed by Mandel, Griffin and the managers of DE Shaw who completed the top five artists of all time.

In 2020 only Dalio’s Paulson & Co. and John Paulson, who earned billions from betting on the housing market during the financial crisis, lost money, data show.

Jim Simons’ Renaissance Technologies, often ranked among the world’s most successful funds due to returns from its Medallion portfolio, dropped out of the top 20 after funds it offers to outsiders dropped between 20% and 30% last year.

“The conditions favored the man over the machine and it was remarkable that Renaissance Technologies, a machine driven manager, came out of the top 20,” said Sopher.

Report by Svea Herbst-Bayliss; Editing by Daniel Wallis