Hedge Fund 100: Big Firms Strive To Earn Trust and Dollars of Institutional Investors
Bridgewater, J.P. Morgan Asset Management and Man Investments lead the way in our tenth annual Hedge Fund 100 ranking of the world’s biggest hedge fund firms. Bridgewater’s ascent parallels the rise of institutional investor interest in hedge funds during the past decade.
By Imogen Rose-Smith
A decade ago Bridgewater Associates didnt really think of itself as a hedge fund firm. The Westport, Connecticut, enterprise which Raymond Dalio founded in 1975 to advise corporate clients on how to manage currency and interest rate risk began managing money in 1987 when the World Bank hired it to run a $5 million fixed-income account. Bridgewater launched its Pure Alpha hedge fund during the early 1990s, but the strategy didnt start to take off with investors until that bullish decade came to an ignominious end. So in 2002, when the editors of Institutional Investor were putting together our first ranking of the worlds largest single-manager hedge fund firms by assets under management, its understandable that we missed Bridgewater, despite the fact that it had some $2 billion in Pure Alpha managed accounts.
Today it would be impossible to make that same mistake. With $58.9 billion in hedge fund assets, Bridgewater is the biggest hedge fund firm in the world, leading our tenth annual Hedge Fund 100 ranking.
Bridgewaters ascent parallels the rise of institutional investor interest in hedge funds during the past decade. Pension funds, foundations, endowments and sovereign wealth funds driven by a quest for returns and the desire to diversify out of traditional stocks and bonds have come to invest more and more of their assets in hedge funds. Many have also started to eschew funds of hedge funds, the traditional starting point for institutional investors looking to get into this alternative asset class, preferring to invest directly in a portfolio of hedge fund firms that they construct themselves. ....