One year ago
»» Despite their elevated importance
following the 2008 hedge fund shakeout, investors failed to get most managers to lower
their fees. An analysis of the AR database showed that there was only a minor
change in the management and incentive fees charged by hedge
funds in the Americas since early 2009.
Average terms aren’t much different
today. As of year-end 2010, among the nearly 1,900 funds in
the AR database that disclosed their fees,
the average management fee was down, while the average
performance fee was slightly higher.
| David Tepper: A happy man
»» AR released its ninth annual Rich List,
a ranking of the highest-earning hedge fund managers. Together,
the 25 top earners made a record $25.33 billion, beating the
2007 record of $22.3 billion. It was a huge comeback from 2008,
when the heavyweights' earnings were more than cut in half, to
about $11.6 billion. No. 1 was Appaloosa Management's David
Tepper, who earned a record $4 billion.
John Paulson made even more in 2010. The Paulson
& Co. founder made a record $4.9 billion to claim the top
spot on the 2011 edition of the Rich
List, giving him $12.9 billion in earnings over
the past four years alone. Generally 2010 was only the
third-most lucrative year for the top managers following the
blowout in 2009. The top 25 made a total of $22.07 billion in
2010, down nearly 13% from the $25.33 billion earned the prior
year and slightly less than the $22.29 billion earned by the
top 25 in 2007.
Five years ago
»» It came to light that U.S.-born
hedge fund manager William Browder had been mysteriously denied entry to Russia while
attempting to return to the Moscow headquarters of his $4
billion firm, Hermitage Capital
The confrontation between Hermitage and the Russian
government would escalate and ultimately turn tragic. A Russian
lawyer for the hedge fund, Sergei Magnitsky, died under brutal conditions in prison while awaiting
trial relating to allegations he and Hermitage made related
to massive government tax fraud. Browder recently commented on
these incidents in a February 24 opinion piece in the Wall Street Journal.
»» The assets of the global hedge fund
industry crossed $1.5
Today, global hedge fund assets stand at $2.022 trillion as of yearend, up from
$1.820 trillion a year earlier. The latest gains bring industry
assets back to their 2006 level, but below the peak of $2.6
trillion achieved in 2007.