Dalio Earns $3.9bn to Top Hedge Fund Pay List

Dan McCrum, Financial Times
Friday, 30 Mar 2012 | 5:37 AM ET
Ray Dalio, Founder, President & CIO at Bridgewater
Source: bwater.com
Ray Dalio, Founder, President & CIO at Bridgewater

Ray Dalio, head of Bridgewater, the world’s largest hedge fund, personally made $3.9 billion in a year that his $70 billion Pure Alpha fund produced $13.8 billion of investment profits for its investors, according to industry rankings.

He tops a list published Friday by Absolute Return magazine of the richest 25 hedge fund managers. The select group took home $14.4 billion in pay and paper profits on their own investments last year, down from $22 billion in 2010 in a sign of the industry’s struggle to deliver returns for its clients in 2011.

The list is also a poor advert for the sector, as four of the top five managers made their money from funds closed to new investors. And it was only in January that all the investors in Citadel, the only open fund, run by fourth-placed Ken Griffin, finally recovered losses sustained during the financial crisis.

Top Hedge Fund Earners of 2011
CNBC's David Faber has AR Magazine's hedge fund rich list, and some big fish aren't there this year.

The average haul for the 25 was $576 million, down from $880 million in 2010, in a volatile year when the average hedge fund lost 2 per cent of its investors’ money.

This illustrates the gulf in pay between the top ranks of a diminished banking sector and riches still available from hedge funds. Mr Dalio’s estimated pay was 480 times the $8.1 million received by Brian Moynihan, chief executive of Bank of America , even as his package quadrupled from the year before. Larry Fink, head of BlackRock , the world’s largest asset manager, and one of the best paid executives in finance, earned $22 million in 2011.

Bridgewater manages about $70 billion in hedge fund assets and another $50 billion in “beta” products, mainly for pension funds. Mr Dalio is judged the most successful manager of all time in terms of absolute profits by LCH Investments. He has also signed the giving pledge to donate half of his wealth to charity.

Second and third place went to two hedge fund managers who have retired. Carl Icahn made $2.5 billion after returning the outside capital in his fund to investors early last year. James Simons, founder of Renaissance Technologies, made $2.1 billion.

  Price   Change %Change


Contact Europe News


    Get the best of CNBC in your inbox

    › Learn More

Europe Video

  • Jan Dunning, CEO of St Petersburg-headquartered hypermarket chain Lenta, says the situation in Ukraine has had no impact on the group, as consumer confidence remains unaffected in Russia.

  • Vincent Deluard, European strategist at Ned Davis Research Group, says the strong euro is a problem for the region's companies, especially for the large exporters.

  • European shares closed higher on Thursday as investors brushed aside concerns regarding Ukraine and focused instead on Wall Street earnings and the latest U.S. jobs data.