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The 10 Most Powerful Hedge Fund Managers This Year

As part of Worth’s 10th Annual Power 100, we’re recognizing power players across the industries we cover. Although the hedge fund industry has struggled in the past decade, its founders still yield great financial power. Here are the 10 fund managers to know this year.

BY Michelle Celarier | Finance | Jun 25, 2019

Hedge funds may have underperformed in the past decade, but their founders have amassed great fortunes and are still wielding substantial power financially—and in corporate boardrooms, in think tanks and at the ballot box. They are major philanthropists and art collectors. They are changing city skylines with their purchases of multimillion-dollar skyscraper apartments. And in an industry that resists the tides of change, some are even leaders in the culture-wide discussion of income inequality, beginning to worry whether the great division of wealth in this country—of which they, of course, are beneficiaries—is sustainable. Here, in alphabetical order, are the 10 most powerful hedge funders of 2019 (so far).

READ MORE: What the Hell Happened to Hedge Funds?

Bill Ackman. Photo by Bryan Bedder/Getty Images for the New York Times

BILL ACKMAN

CEO, Pershing Square Capital Management

The 53-year-old activist can certainly shake up companies, with the turnaround he engineered for troubled Chipotle Mexican Grill this past year his latest achievement on that score. But the New York native’s greatest coup may simply be figuring out how to stay in the game.

Ackman’s fortunes took a turn for the worse in recent years due to a bad bet on Valeant, the controversial pharma company—in which he eventually lost $4 billion. While such heavy losses led many to predict Pershing Square would go under, Ackman bested his critics, in no small part because in 2014, he launched a publicly traded hedge fund, one of the biggest of its kind. That gave Pershing Square permanent capital, meaning it isn’t subject to the redemptions that plague hedge funds when they lose money, leading many to close up shop in recent years.

Stability of capital has allowed Ackman to come roaring back this year, outdoing his peers and the market with a 40 percent gain through May. This isn’t his first comeback. Ackman launched his first hedge fund, Gotham Partners, shortly after receiving his MBA from Harvard in 1992. Even though Gotham was forced to shut down in 2001, Ackman returned to found Pershing Square Capital Management in 2004, and soon became famous for a short on municipal bond insurer MBIA, making $1 billion when its stock collapsed during the financial crisis.

Ackman, who is worth $1.1 billion, is also one of the most philanthropic hedge fund managers: He’s already given away about $500 million, most of it through his Pershing Square Foundation.

READ MORE: How Marc Benioff and Other Tech Titans Are Disrupting Philanthropy

Steven A. Cohen (right). Photo by David Kotinsky/Stringer via Getty Images

STEVEN A. COHEN

Founder, Point72 Asset Management and SAC Capital

Before his SAC Capital hedge fund got caught up in the insider trading dragnet of then-Manhattan U.S. Attorney Preet Bharara, Cohen was the unofficial kingpin of the hedge fund world, known for mouthwatering double-digit returns and a massive art collection.

A native of Great Neck, N.Y., Cohen started trading options at Gruntal & Co. after graduating from Wharton in 1978. That inauspicious start eventually led him to launch SAC Capital in 1992. In 2013, SAC gained notoriety when it pled guilty to securities fraud, paid a record $1.8 billion fine and shut its doors. Cohen, now 63, was never charged, and he continued to manage his own wealth, now estimated at about $13 billion.

In 2018 regulators allowed Cohen to raise money from investors again, and they quickly forked over $5 billion for his new hedge fund, Point72 Asset Management. But coming back to the world of hedge funds in a different era, Cohen has failed to produce the blockbuster returns that made him famous. Even so, this year he is trying to raise another $1 billion from investors. And he continues to pursue art: Cohen dropped a cool $91 million for a Jeff Koons’ balloon sculpture at Christie’s spring auction this year. It’s one of several Koons’ pieces he owns.

CHASE COLEMAN

Founder, Tiger Global Management

A descendent of Peter Stuyvesant, the last Dutch governor of New York, 44-year-old Coleman is as close to an American aristocrat as they come. Raised in the tiny Long Island hamlet of Glen Head, N.Y., Coleman started as a tech analyst at Julian Robertson’s Tiger Management, which he joined after graduating from Williams College. After Robertson shut his firm in 2000, he staked Coleman with $25 million to start Tiger Global, making the young hedge fund manager a so-called Tiger Cub.

Tiger Global, whose venture capital arm is now bigger than its original hedge fund—together they have $28 billion—has become one of the most prominent and successful investors in technology. Coleman, who is worth about $3 billion, is widely considered a pioneer for investing early in such big hits as Facebook, LinkedIn and Spotify. This year Tiger has the highest number of unicorn investments in its portfolio—42—more than even China’s Tencent and Japan’s SoftBank. Tiger’s investments include Airbnb, Palantir and Uber, which it sold before the ride-sharing service’s debut.

Ray Dalio. Photo courtesy of Wikimedia Commons

RAY DALIO

Founder, Bridgewater Associates; author

Ray Dalio, 69, heads the world’s biggest hedge fund, with $150 billion in assets. But in recent years he has also become something of a philosopher, starting with his 2017 book Principles, which lays out his views on life and work.

READ MORE: Question of Principles

More recently, Dalio has been speaking out about the problems of American capitalism, saying it needs urgent reform. Arguing that “the American dream is lost,” he believes taxes on the wealthy should be raised, because the increasing disparities in income wealth and opportunities among Americans “pose existential threats to the U.S.”

Dalio, who grew up in Queens as the son of a jazz musician father and homemaker mother, got his first taste of trading stocks with money he earned working as a golf caddy while in high school. After getting an MBA from Harvard and a handful of Wall Street jobs, mostly trading commodities, Dalio founded Bridgewater in 1975 and struggled throughout the 1980s. Four decades later, Dalio is one of the world’s wealthiest people, now worth $18.4 billion.

Dalio recently called out the underfunding of public schools, which he described as “economically stupid.” Shortly after publishing these views on LinkedIn, Dalio and his wife gave $100 million to strengthen the public education system in Connecticut, where they live.

READ MORE: Why Ray Dalio Thinks He Can Prevent Debt Crises

Ken Griffin. Photo courtesy of Wikimedia Commons

Ken Griffin

Founder and CEO, Citadel

Griffin was considered a boy-wonder investor when he launched Citadel in 1990. That was just a year after he graduated from Harvard, where he famously started trading convertible bonds from his dorm room. By 2008, Citadel’s high leverage led it to lose half of its assets during the financial crisis, but the ensuing era of Fed-induced low interest rates allowed Citadel to recoup its losses and flourish. It is now one of the world’s largest hedge fund empires, with $30 billion under management, and Griffin’s Citadel Securities is also a leading market maker.

Now 50, Griffin made news this year for paying $238 million for a Manhattan skyscraper penthouse overlooking Central Park, the highest ever paid for a U.S. home.

Griffin, a Republican donor who is worth $11.6 billion, also said that “soaking the rich doesn’t work” in a noted interview at the annual Milken Institute Global Conference in April in which he addressed political solutions to income inequality. Two years ago, Griffin gave $125 million to the University of Chicago, which is renaming its economics department after him.

Paul Tudor Jones. Photo by Bennett Raglin/WireImage via Getty Images

PAUL TUDOR JONES

Founder, Tudor Investment and Robin Hood Foundation

Jones’s hedge fund, Tudor Investment, is one of the nation’s oldest, making the 64-year-old worth $5 billion. But he is better known for launching the Robin Hood Foundation, which has been providing millions of dollars to charities and social programs throughout New York since 1988.  Its annual gala is a must for financiers on the city’s social and charity circuit.

This year, Jones joined billionaires like Ray Dalio who are speaking out about severe wealth inequality. He noted recently that 43 percent of people polled in the U.S. said they would vote for socialism over capitalism, adding, “I’m a capitalist, so I don’t want that to see that happen.”

Jones also just signed the Giving Pledge, created by Bill Gates and Warren Buffett in 2010, committing to giving away half of his substantial wealth. And last year he started JUST Capital, a nonprofit that ranks corporate ethical behavior and hopes to change corporate behavior by moral persuasion, not regulation.

READ MORE: How to Serve on a Nonprofit Board

A son of the South, Memphis-born Jones studied economics at the University of Virginia, then worked at E.F. Hutton, starting as a clerk. Jones decided not to study at Harvard Business School and started trading cotton futures on the NYSE instead. He launched his Greenwich, Conn.-based hedge fund in 1980, but it was his bearish bet on the market just before the 1987 stock market rout known as Black Monday that made him rich—and famous.

Daniel Loeb. Photo by Jon Kopaloff/Getty Images

DANIEL LOEB

Founder and CEO, Third Point

Now 57, Loeb has shed his image as the enfant terrible of hedge fund shareholder activists. Once well-known for his “poison pen” letters to CEOs, today he is simply one of the most prominent hedge fund activists, running $14 billion. 

Loeb proved his activist mettle last year when he managed to wrangle two board seats at Campbell Soup, a faded American food icon, even though he didn’t have enough votes to win a proxy battle with the company. This year, he is taking on Japanese electronics-entertainment giant Sony after a prior attempt in 2013 that failed to convince the company to sell part of its entertainment business. Although Third Point had a rare double-digit loss last year, it has come back in 2019 with big gains on the back of the activism plays. 

A native Californian, Loeb received an economics degree from Columbia University, then worked in a series of Wall Street jobs at such firms as Jefferies and Citigroup before eventually starting his Third Point hedge fund in 1995.

Loeb, who is worth $2.8 billion, is also a major art collector and is on the board of Sotheby’s, after waging an activist campaign against prior leadership several years ago. The auction house just agreed to a $2.66 billion deal to be taken private by Patrick Drahl, a leading art collector who is the founder of cable TV giant Altice. 

Paul Singer. Photo courtesy of Wikimedia Commons

PAUL SINGER

Founder and Co-CEO, Elliott Management

Seventy-four-year-old Singer runs one of the oldest hedge funds around—it is 42 years old this year. He is also one of the most feared investors on the planet.

Singer first burst into public view in 2012 during his 15-year legal battle with Argentina, when he briefly nabbed an Argentine Naval frigate in a global search for assets to satisfy his debt claim against the South American country.

After winning his legal battle with Argentina in 2016, Singer went on to use the scorched earth tactics honed in sovereign debt and bankruptcy battles to become a fearsome shareholder activist. His tactics continue to be controversial, but last year his $34 billion hedge fund subjected 24 companies to its demands, making it the number one activist of the year. This year, even with a soaring stock market, the work has gotten a little tougher. Elliott’s two main funds were up less than 2 percent through May.

Singer has also been a top Republican financier for years and is longtime chairman of the Manhattan Institute, a conservative think tank. Now worth $3.2 billion, he grew up the son of a pharmacist in Teaneck, N.J., received a JD from Harvard Law School in 1969 and started his hedge fund, Elliott Associates, in 1977.

READ MORE: 16 Powerhouse Female Economists

JEFFREY SMITH

CEO, Starboard Value

Smith was a little-known hedge fund manager when he roared into public view for criticizing the free breadsticks at Darden Restaurant’s Olive Garden chain, part of a high-stakes activist campaign that led to a rare takeover of the company’s entire board in 2014.

Since then, Smith has become a force in corporate America, highly regarded for his operational turnaround expertise. Early in 2019, Starboard shot to the top of the activist tables by announcing seven new investments worth $2.3 billion—which accounts for about half of Starboard’s assets under management. Earlier this year, Starboard was threatening proxy battles in at least three of its new activist plays.

 Smith grew up in Great Neck, N.Y., and received a degree in economics at the Wharton School before embarking on a Wall Street career, starting in the M&A division of French bank Société Générale before joining hedge fund Ramius. That fund was founded by Peter Cohen, the former chairman and CEO of Shearson Lehman Brothers. Smith helped launch the Starboard strategy at Ramius and spun it out independently in 2011.

Donald Sussman. Photo by Wikimedia Commons

DONALD SUSSMAN

Founder and CIO, Paloma Partners

While Sussman runs hedge fund Paloma Partners in Greenwich, Conn., he is becoming better known as a top Democratic donor in the Trump era.

Financing for the 2020 election is still in its first innings, but so far Sussman is the lead donor in the race and contributed $865,300 during the first quarter, all of it to Democrats. Last year he was the fifth largest donor in the pivotal midterm Congressional blue wave, giving nearly $23 million to Democrats, which was more than he gave to Hillary Clinton during her 2016 presidential bid, when he was her top individual supporter. (Sussman was formerly married to Rep. Chellie Pingree, a Democrat from Maine.)

A Florida native, Sussman is a graduate of New York University, where he received both a BS and an MBA. He founded hedge fund Paloma Partners in 1981, and early on became known for recognizing new talent and staking some of the early hedge funds. He was the original seed backer of D.E. Shaw, the first quantitative hedge fund, which has gone on to become one of the world’s largest and most well-known. He invested early in Elliott Associates.

Sussman is also a member of the board of trustees of Carnegie Hall, a member of the board of directors of ProPublica, which publishes investigative journalism, and an honorary trustee of the Ethical Culture Fieldston School.

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