George Soros’ announcement Wednesday that he is returning outside money from his hedge fund and will continue to operate as a family office is yet another reminder of how hard and clumsy it is for a billionaire hedge fund manager to retire.
Except on rare occasions, most successful hedge fund managers rarely seem to call it quits on a high note. Part of the reason is they seem to have trouble retiring in general.
In the case of Soros, if the octogenarian stuck around longer, he may have somewhat tarnished his stellar image. While he has enjoyed a 20 percent annualized return over the several decades he has run his multi-strat Quantum funds, this year he was down 6 percent through June after eking out just a 2.63 percent gain last year, according to knowledgeable sources. And at a conference several months ago, Soros seemed confused by the current market environment, reportedly stating: “I find the current [market] situation much more baffling and much less predictable than I did at the time of the height of the financial crisis.”
However, the story ended quite differently for Tiger Management’s Julian Robertson. During the 1990s, he along with Soros and Michael Steinhardt were the hedge fund industry’s standard bearers who helped put the asset class on the Wall Street map and their huge personal financial success attracted a generation of billionaire wannabes to the business, for better or worse. The firm grew from $700 million at the beginning of the decade to $12 billion at the midway point and to a peak of $26 billion by 1998.....