Through a combination of stunning performance last year and a devoted following among institutional investors, Ray Dalio’s Bridgewater Associates has cemented its position as the largest hedge fund in the world, as we note in our annual Billion Dollar Club survey this month. It now boasts an impressive $59 billion in hedge fund assets.
But do investors really have a clue about what’s going on behind the scenes?
Ever since Dalio called the credit bubble in 2006, I’ve wanted to find out more about this enigmatic, iconoclastic thinker. The cover profile of Dalio’s Bridgewater in this issue offers a glimpse into what makes him tick. It’s not contrarian investment ideas that are the most intriguing thing about Dalio, as it turns out. It’s the fact that such intelligence coexists with the culture he has created at his Westport, Conn. firm that employs 1,100 people.
The so-called radical truth that Dalio espouses sounds great when you’re analyzing markets. But it can be brutal when dealing with human beings, as staff writer Lawrence Delevingne and I learned by digging a little deeper and talking to some of the people who have left the hedge fund in recent years.
Bridgewater is not a cult, as it has been described. And some people thrive in that environment. But from what we’ve been told—much of which cannot be printed in this magazine—I don’t think it’s an overstatement to say that the place could leave emotional scars. That’s a tall order in hedge fund land. After all, these places aren’t for sissies.
Bridgewater has done well for its investors, and last year AR gave the firm our management firm of the year award in recognition of its success. That cannot be denied.
In the spirit of transparency and truth that Bridgewater advocates however, we also cannot deny how it treats the employees that help investors achieve such results. Perhaps I’ve been watching too much TV showing too many leaders being toppled around the world. But I have to wonder, isn’t there a better way?
